How to Choose a Bitcoin Exchange
Just a few short years ago there wasn’t much choice when it came to Bitcoin exchanges. However, today there are plenty of Bitcoin exchanges available. This means that you can buy Bitcoin quickly and easily via a number of different payment methods. If you’re unsure how to choose a Bitcoin exchange, consider the following factors:
What is your level of experience?
While experience shouldn’t prohibit yourself from using one Bitcoin exchange or another, it may be that you find some exchanges more suitable than others. If you’re new to cryptocurrency and it’s your first time buying Bitcoin, there are some Bitcoin exchanges which are more user-friendly such as Coinbase. However, those with greater trading experience may appreciate some of the advanced features on exchanges such as Kraken and Bitfinex.
Where is the Bitcoin exchange based?
Where a Bitcoin exchange is located can dictate whether it’s a viable option for you. First off, be sure to check your country’s laws with regard to trading cryptocurrency – it’s not legal everywhere. It may be that there are exchanges based in your country and these should be the easiest for you to use if they accept your local currency. However, there are many Bitcoin exchanges that are available around the world and some of these accept multiple currencies and payment methods.
Which payment methods does it accept?
Some of the biggest cryptocurrency exchanges only deal with cryptocurrencies and don’t offer any fiat/cryptocurrency pairs (fiat stands for “legal tender”, i.e. dollars, euros etc).
If this is your first time buying Bitcoin, you’ll want to find a Bitcoin exchange that accepts fiat via bank transfer or credit card, for example. A few cryptocurrency exchanges even accept PayPal. Which method you choose is really down to personal preference. Be sure to consider any fees involved as well as the level of privacy provided.
What is the level of fees charged?
The level of fees charged by Bitcoin exchanges can vary a great deal. That’s why you should investigate the fees charged in order to make sure that you’re okay with them. Fees can be charged when you trade Bitcoin as well as when you make a deposit or withdrawal. The type of payment method can also have a big impact. For example, Coinbase allows you to pay by credit card or debit card but there’s a relatively high fee involved. Sometimes the quicker and easier it is, the higher the fee charged by the Bitcoin exchange.
How secure is the Bitcoin exchange?
Unfortunately, there have been a number of high profile Bitcoin exchange hacks, resulting in users losing funds. It’s therefore vital that you choose a Bitcoin exchange which offers a high level of security.
For example, there should be the option of Two-factor Authentication while email and SMS alerts, cold storage and encrypted emails are also desirable. No matter how secure the Bitcoin exchange appears, don’t leave all of your funds in it. Your best bet is to download a desktop wallet or buy a hardware wallet for greater security.
We hope this helps when you come to choose a Bitcoin exchange. One last thing – Be sure to read plenty of user reviews online and check out if an exchange offers good customer support in case any issues do arise. Best of luck!
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