What to look for when choosing a cryptocurrency platform that’s best for you!
OBR | CEO
What Are Cryptocurrency Exchanges?
A cryptocurrency exchange is essentially a marketplace, an online platform similar to a stock exchange with a focus on cryptocurrency trades instead of stocks; trading of one digital asset for another. You can also exchange your cryptocurrency for a fiat currency like the Australian dollar. For example, you can trade your Bitcoin for Ethereum at an exchange which offers both digital assets or sell out your Bitcoin for Australian dollars at current market prices.
Cryptocurrency exchanges use blockchain technology to record all trades and settlements in a secure way. As a result, they offer a number of advantages over other exchanges, such as low transaction fees and fast settlement times.
Some cryptocurrency exchanges offer a platform which is focused on ease for the customer and some hope to offer competitive pricing. Others want to provide a platform which is focussed on professional cryptocurrency traders.
What Are The Types Of Cryptocurrency Exchanges?
There are three different types of cryptocurrency exchanges:
- Centralised (CEX)
- Decentralised (DEX)
What Is A CEX?
Centralized exchanges (CEXs) are organisations that govern and coordinate cryptocurrency trading on a large scale, using a similar business model to traditional asset exchanges, like stock exchanges. They directly participate in the market by ‘clearing’ the trades. They usually keep digital order books, which are lists of open-buy and sell orders, consisting of volumes and prices. They match up buyers and sellers and announce current market prices based on the last price an asset sells for.
To make purchasing or trading crypto even easier for the customer, CEXs may also offer digital assets directly for sale or swap from them at a higher fee. CEXs usually offer services such as crypto asset custody or a hot wallet (a place to store your crypto).
According to a 2021 report by global accountancy company, KPMG, CEX exchanges are the most valuable businesses in the crypto sphere. As of October, 2021, it was found that they accounted for 95% of crypto trading exchanges. The largest crypto exchange in the world is Binance, which is centralised but has launched its own DEX in recent times.
• Easy to use
• Offers high trade volumes
• Allows fiat-to-crypto trades
• High functionality, often including customer service if needed
• More vulnerable to hacks
• Centrally governed
• Complies with government regulations – can be shut down
• KYC (Know Your Customer) – detailed information must be provided for tax purposes to join
What Is A DEX
A decententralised exchange (or DEX) acts as an alternative to a traditional CEX, doing away with a centralised company or authority. Instead, crypto traders utilise an automated process, transacting directly, peer-to-peer.
The decentralised exchanges are built with blockchain technology to ensure that there is a secure way to transfer of digital assets. The platform acts as a service which connects trade orders with one another to serve customers looking to trade tokens.
Many popular DEXs, like Uniswap and Sushiswap, run on the Ethereum blockchain.
• Offers high security rom hacks due to distributed nodes
• The government cannot shut them down
• No centralised nodes
• Not KYC so can trade anonymously
• Not as easy to use as CEX
• Offers low trade volumes compared to CEX
• Does not have high liquidity
• Only offers crypto-to-crypto trades
What Is A Hybrid Exchange?
The limitations of both the DEXs and CEXs led to the creation of the hybrid cryptocurrency exchange. This specialised crypto exchange combines the best features of both the centralised and decentralised exchanges and addresses all of their shortcomings. They adopt the usability and liquidity of CEXs and the anonymity and security of DEXs.
Like decentralised exchanges, a hybrid makes use of smart contracts so that users do not have to hand over their funds to a central figure possibly imposing on the integrity of the trade. This reduces security risks by placing the customer’s assets on a blockchain rather than relying on a company.
An example of a hybrid exchange is Eidoo, which allows trading ETH and ERC20 tokens via smart contracts, ensuring efficient and fast order management and order matching. Its main goal is to provide the easiest access to crypto through a user-friendly interface with an intuitive order book. The user account is based on a smart contract on the Ethereum blockchain, where tokens are stored, preventing any direct unauthorized access to your funds.
How To Choose The Best Cryptocurrency Exhange For You
The cryptocurrency market has been growing at a very fast pace in the past few years. This growth has brought new challenges for traders and investors who are looking to get into the market. One of the main challenges for someone new to the crypto space is finding the best cryptocurrency Exchange. But how do you decide which one is best for you? We suggest a few things to research before you decide, such as:
- Is the platform easy to use?
- Is the platform authentic and provide accessible customer support?
- What are the fees or charges?
- Does it have good security?
- Does it have a good selection of coins available?
Ease Of Use
Basic features on cryptocurrency exchanges are the same and include the ability to send, receive, and store tokens. However, ask yourself whether an exchange intuitive to use? Are you able to find your way around the first time you go into the exchange to deposit fiat dollars and purchase some cryptocurrencies? How easy is it to use the first time? Is your experience even easier the second time around? You do not want buying crypto to be a hard and stressful experience.
With the growing amount of people getting involved in the crypto space and the volatile nature of the market high level customer support is vita. If a cryptocurrency exchange does not have high-quality customer support, it will not stay in the competition for a long time. Polite, fast, helpful, and transparent are some of the must-have customer support qualities to survive in the crypto market. If you are looking for a crypto exchange to join, look for a few parameters that they will be there to support you when you need it.
These are a few things to look out for:
- Reaction rates are reasonable
- Variety of communication mediums
- Helpful and provide data-oriented feedback
- Politeness and calmness
- Completeness of answer
While most cryptocurrencies are decentralised, the process of buying them is not. The best way to buy digital currencies to begin with is through a centralised exchange (CEX) so that you can trade cryptocurrencies for fiat currency. However, this process comes with a cost that must be considered when purchasing your digital assets.
Be aware of what fees that you will be incurring with the exchange that you choose to use. You may choose to pay a little bit more fees with in exchange for an easier platform to navigate. Or if paying minimal fees is important to you, especially if you are planning large purchases, then choose wisely.
The exact fee of each exchange will vary depending on the network, but generally it’s between 0.1% and 2%.
Most exchanges earn their money by charging a commission on each trade executed within their platform. They may also charge a deposit fee and almost always charge for withdrawals.
Cryptocurrency exchanges charge transaction fees for transferring your cryptocurrency from your account on their platform. A transaction fee is the fee charged by an exchange or wallet to send cryptocurrency from your account on their platform to another account or wallet.
Regulation And Safety
In order to understand the regulatory framework of cryptocurrency, it is necessary to look at the laws that apply to currency in general. For example, if a cryptocurrency exchange business accepts payments from customers using cash, credit or debit cards, they are required by law to follow “Anti-Money laundering” (AML) rules and regulations, as well as other “Know Your Customer” (KYC) procedures.
So, is your money safe on a cryptocurrency platform? It’s a fair question to ask. The crypto space is a very volatile industry, and with the market cap of all cryptocurrencies at $2+ billion, there are plenty of opportunities for your money to disappear. Ensure you research the security of the platform that you choose to use.
Cryptocurrency assets include all digital assets that exist on the blockchain, including every transaction made. The most common cryptocurrency assets include Bitcoin, Ethereum, Ripple, and Litecoin. As of March 2022, there are 18,465 cryptocurrencies in existence. However, not all cryptocurrencies are active or valuable. Discounting many “dead” cryptos leaves only around 10,363 active cryptocurrencies. So many to choose from! Ensure that you do your own diligent research on the cryptocurrencies that you are looking to buy or trade.
Some Of The Best Cryptocurrency Exchanges To Choose From In Australia
Swyftx is an Australian-owned and operated centralised exchange backed by global liquidity providers. As an AUSTRAC regulated exchange, they employ KYC identification processes. Swyftx is my top choice for trading cryptocurrencies.
Offering some of the lowest trading fees (0.6%) and smallest spreads on the cryptocurrency market, Swyftx allows you to enjoy instant and low-cost transactions, with no delays and no hidden fees.
Swyftx also offers advanced trading features such as portfolio tracking and price alerts so you can view your real-time profit and loss on all digital assets you own and never miss a price opportunity again. As a user of Swyftx your digital currency is protected by a two-factor authentication and biometric log-in.
Benefits of selecting Swyftx include:
- Quick sign-up & verification process – No uploading documents or selfies
- Simple and user-friendly interface
- Buy instantly with AUD and no deposit or withdrawal fees
- Credit and debit card deposits
- Over 280+ cryptocurrencies to buy, sell or trade
- Staking of cryptocurrencies
- Low fees of only 0.6% and low spread
- Android and iOS apps available so you can trade anywhere at anytime
- Live Chat support available for queries
- Registered with AUSTAC and complies with strict KYC/AML obligations
- Security is top priority to ensure customers can trade safely
- Only can be used by people in Australia and New Zealand
CoinSpot is an Australian centralised crypto exchange that was able to capture the market by being one of the earliest players, opening its doors in 2013. It is my top choice for complete beginners who just want to buy and hold a few cryptocurrencies. It is a very user-friendly platform and includes Live Chat support with the comfort of a real person at the other end.
CoinSpot has earned the reputation as Australia’s most trusted and secure crypto exchange, having undergone the most audits and the only exchange to receive the ISO 27001 certification.
Registering with CoinSpot is simple. You can do it from your mobile phone or tablet in a few minutes and start trading immediately. You can then buy and sell cryptocurrencies instantly on CoinSpot using a variety of payment methods.
Benefits of selecting CoinSpot include:
- Lowest fees – starting from 0.1%
- Variety of deposit methods: Bank transfer, OSKO, BPay. POLi, PayID, Cash & Cryptocurrency
- Mobile app available for Android and iOS
- 350+ cryptocurrencies listed
- NFT Marketplace
- 5 million users
- 24/7 Live Chat support & telephone support when needed
- Stringent security protocols including multi-stage verification, and customisable account restrictions.
- Assets held securely in offline storage
If you would like to sign up to CoinSpot, please join with this link to get $10 worth of Bitcoin for FREE.
Digital Surge Exchange
Digital Surge is an Australian centralised exchange that was launched in 2017 which focuses on ensuring their platform is super intuitive, user-friendly and very safe for ‘everyday’ Australians. They also prioritise educating their investors at the same time.
Additionally, Digital Surge is low cost, offering personalised support, giving new crypto investors an all-rounded positive trading experience. This exchange is suitable for beginners to avid traders, offering a wide range of benefits that make it stand out from other exchanges. Even a complete beginner to crypto can work out how to easily purchase over 300+ coins with AUD.
A really interesting feature that Digital Surge has, that is not found on any other Australian cryptocurrency exchange, is the ability to pay bills using Bitcoin. If you have an Australian bill or credit card that accepts BPAY, you can use Bitcoin directly from your Digital Surge account to pay it. This is extremely convenient, saving you time since you don’t need to sell your BTC, then withdraw it before you can use your AUD. It also marks a growing acceptance and adoption of cryptocurrency in Australia, which is a big plus for crypto investors.
Benefits of selecting Digital Surge include:
- Quick and easy sign-up process so you can start trading in under 2 min
- Buy instantly using AUD, with free secure deposits using PayID
- Lowest fees in the Australian market at 0.5% and going as low as 0.1% when buying, selling or trading.
- Over 300+ cryptocurrencies to buy, sell or trade
- Mobile app available for Android and iOS
- Ability to pay Australian bills and credit cards using Bitcoin
- 24/7 responsive and personalised customer support via live chat or email
- ASIC & AUSTRAC registered
- Regularly updated multi-layered security
- Assets held securely in offline storage
Independent Reserve Exchange
Founded in 2013, Independent Reserve pride themselves on offering world-class security for their 200,000+ customers throughout Australia, New Zealand and Singapore, and the only Australian exchange to offer insurance on your crypto assets. With a 2-factor authentication, ISO 27001 certification and top-tier underground vaults used to protect your data, Independent Reserve is a popular trading platform. It has built a world class OTC Service Desk and trusted by over 8,000 Self-Managed Super Funds.
Independent Reserve may not be as well-known as other top crypto exchanges, but they are still a great choice for Aussies getting into the market. However, their platform is not as intuitive for beginners as the exchanges above, but are ideal for experienced high-volume traders with its VIP Service Desk for large OTC (over-the-counter) trades with a discount on large volume trades over $20 million per month. The exchange only supports 27 cryptocurrencies, but most of these are top 30 globally traded and trusted coins.
Benefits of selecting Independent Reserve include:
- Long standing and trusted Australian Crypto exchange, with full regulatory AUSTRAC compliance
- FastTrack accounts allowing users to register and start trading in minutes
- Ability to deposit multiple currencies including AUD, USD, SGD & NZD
- 27 cryptocurrencies to buy, sell or trade
- Trading fees of 0.5% (as low as 0.02% if high-volume trader)
- Mobile app available for Android and iOS
- Support desk available for any issues
- Premium accounts have insurance on crypto assets
- Advanced secure crypto cold storage inn eo-dispersed data centres and vaults
CoinJar has been around since 2013 and has been a leader in the Australian Bitcoin industry for some time now. They have recently expanded into the UK and you can buy crypto with AUD and GBP using a debit card, bank transfers, Visa and Mastercard or by sending funds from your PayPal account. The real standout is their recent CoinJar card, which is a Mastercard loaded with your crypto. You can use it to spend your crypto online and in-store.
Their team of experts work hard to ensure users enjoy their trading experiences from the on-boarding process through to trading on the platform. CoinJar is limited to only 40+ different cryptocurrencies.
Benefits of selecting CoinJar include:
- Simple and easy-to-use platform for new users
- Buy cryptocurrency instantly with AUD & GBP
- Visa and Mastercard deposits supported
- Mobile app available for Android and iOS
- CoinJar Mastercard so you can spend your crypto like cash
- Secure, private & encrypted
If you’re ready to invest in cryptocurrencies for the first time, then you’re going to want to make sure that you’re investing on the right platform for you. There are a lot of platforms that promise to make investing in cryptocurrencies easy and simple. However, ensuring you select the correct platform from the beginning is important.
If you are going to advance to trading crypto, then you may like to choose a different platform from the one you start off with. Make sure to research all trading platforms, check for any hidden fees, ensure its easy to use and has great security precautions, and enjoy your buying and trading experience from the get-go! It can be a lot of fun.
If you would like some assistance getting started to purchase your first cryptocurrency or you’d like some mentoring on learning to trade, please do not hesitate to get in contact with one of our consultants and set up an appointment.
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