Sadly, you can’t just call your bank and ask them to purchase crypto, like you would with Dollars or even Euros. If you’re looking at the value of Bitcoin or Ethereum, for example, you’ll have to look for more specialized services. That’s where these exchanges come in.
They just work with the cryptocurrency market and will help you purchase and manage your investments in it. Considering this might be the currency of the future, there’s no better time than now to start investing.
Keep reading to find out everything you need to know about a crypto exchange and the top four picks of 2022.
What is a crypto exchange?
A crypto exchange is much like a bank, but it only works with some cryptocurrency. For now, you won’t be able to buy every single type of currency from the same place. But that’s alright, the main ones (Bitcoin and Ethereum) are fairly common around crypto exchanges.
Using these only services you can trade regular currencies for the online ones. So you can use dollars to get Bitcoin. The opposite is also true when you make a withdrawal and leave the cash within your account.
We can’t give you a single crypto exchange that will fulfill all of your needs. Each user will need to find the one that fits them the best and it could take a lot of research. After all, they each have fees and regulations that might or might not benefit you.
You could even look for a financial advisor whose expertise lies in cryptocurrency. They can recommend the best type of crypto and where to buy it from according to your spending habits and risk profile.
Types of crypto exchange
Before you look at the best crypto exchange options of 2022, it’s wise to understand how each type works. As we mentioned before, there isn’t one size fits all when it comes to cryptocurrency. Actually, that’s the case for most investments you’ll find in the financial market.
You’ll find some platforms that offer many kinds of financial and digital services, as well as the purchasing of crypto. Some other times you’ll find ones that only sell you Bitcoins and Ethereum, but at a better price. Everything depends on where you’re at financially and which are your next objectives.
Read about each one in detail below before making a choice.
1. Brokers
There are a few brokers that also work with cryptocurrencies. But we must warn you that they don’t classify purely as a crypto exchange, instead they act as middlemen for your purchase and can help a lot if you’re a beginner in the art of crypto.
With a quick Google Research you’ll find that there are dozens of crypto brokers out there. Many of them give you consultations online to make everything easier. A warning when it comes to brokers: while they’ll give you sound advice, buying from them usually includes handling fees.
So if you’re more advanced in the crypto world, we recommend you try one of the exchange options we’ll list below. That will allow you to get more value for your money at the time of the purchase.
2. Traditional crypto exchange
Your usual crypto exchange works a lot like the stock market. You can buy online coins according to the market price of the day or sell those you currently own. To start, users must create an account or wallet to store their coins over time. This means that crypto exchanges must also offer greater security for the user that’s operating them.
These services also charge fees for transactions, but they are lower and fewer in number than those that come with working through brokers. You can find some exchanges that work only in online currencies and others that accept US dollars.
3. Centralized crypto exchange
This is a type of traditional crypto exchange, but it’s overseen by a crypto operator. This third party is responsible to make sure that customers registration and trading happens without major slip ups. Operators stand between buyers and sellers, making transactions more reliable for both parties.
Once you sign up for these platforms, all you must do is link your bank account or card to start buying. They are fast and typically easy to operate, but most of them charge fees because of the trade operator.
Most centralized crypto exchange types work with dollars and other currencies, as well as crypto. This means you can start with your current investments before converting everything into digital coins.
4. Decentralized crypto exchange
This second type of traditional crypto exchange works without the trade operator altogether. It’s the most pure form of trading cryptocurrency, which was born from the belief that the ideal coin should work without any type of central authority or government.
These are open-source and peer-to-peer dependent platforms. This means way less fees when it’s time to buy crypto, but also a different and more complex type of security that asks for some programming knowledge from the user. Beginners will likely be lost if they start operating in decentralized platforms straight away and could even be targets for fraud.
Only risk your luck with them after you have some decent knowledge about cryptocurrencies and the system that protects them.
Best crypto exchange of 2022
Remember that most crypto exchange platforms are fairly new products in the financial market. Even some gurus that claim to know everything about them end up losing everything in crypto trading or become the victims of fraud. So we urge that those who are getting started take caution and work slowly to get the best and safest results.
Research is one of the keys to make sure you made the best and safest choice. Many currencies are incredibly volatile and are only recommended for those with high risk profiles. This means you must look into each individual currency you’re likely to buy as well, but we’ll leave this explanation for another article.
For now, it’s important to know the best choices of crypto currency exchange this year when it comes to flexibility, safety and fees. Check the full list below!
1. Binance.US
We’re starting with a crypto exchange that works with more than 50 types of coins. This gives it a great rating on flexibility and allows users to vary their wallet of investments, which also means more protection against market fluctuations.
It also has some of the lowest fees among its peers, charging only 0,1% of each transaction. The Chinese platform started in 2017 and has been working with a high-speed order system that allows trades to happen at record speeds.
However, since this is a foreign platform, it isn’t available for all 50 US states. It moved its operations to Japan in 2020 to avoid regulatory issues, but claims not to have a headquarter.
Don’t get your hopes up with the low costs of the platform, this isn’t for beginners. It works mostly as a peer-to-peer exchange.
2. Coinbase
Coinbase is quite well known in the world of crypto exchange. Its main objective is to make life easier for anyone that wants to buy, sell or store cryptocurrency, especially Bitcoin. That’s why the system claims to be as easy as using a broker or brokerage services to get online coins.
This is usually the go-to platform for beginners since it also offers some educational content. It also supports many cryptocurrencies so you can get started on any of your choice. There is a “free” version for users to explore before they start buying as well, but we strongly recommend you try the Coinbase Pro option, since it offers lower fees.
3. Kraken
Don’t worry, Kraken isn’t actually a mythological creature that’s really hard to defeat. It’s also an easy to use crypto exchange that offers low fees for its users and support for more than 100 cryptocurrencies. It’s a centralized exchange that works with a trade operator to guarantee the security of its trades.
Its fees are actually lower than Coinbase most of the time, but there are a few cons to it. Some users report safety problems and lack of security for their crypto trade. Since this isn’t a problem for everyone, it’s worth a try. Just refrain from making huge investments before you’re sure of how to operate the system properly.
4. Crypto.com
If you’re looking for variety, this is the choice for you. Crypto.com is a crypto exchange that works with more than 250 online currencies. Did you think that this means higher fees? Not really, the prices for using this platform are very reasonable and there are even discounts for some users.
Most complaints when it comes to Crypto.com have to do with its customer support. Normally, you’ll have to wait to get an answer, so it’s good to have some knowledge about the system and cryptocurrency if this is your choice for trading.
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