What is Cryptocurrency?

Cryptocurrency has become a global phenomenon, but it is difficult sometimes for people to understand it. So let’s walk through the whole story. What are cryptocurrencies? A general definition of cryptocurrency says that “it is digital and decentralized money that depends on blockchain technology”. It was created on the idea of eCash by an American cryptographer David Chaum in 1983. Digital currency in the form of crypto was able to move undetected without any involvement of other recipients, including banks, governments or any third party. Moreover, maintenance of records and verification of records is done by a decentralized system. Some of the common names in the crypto market are Bitcoin, Litecoin and Etheruem, and more than 5000 cryptocurrencies are also available for dealing. Bitcoin was the first-ever disseminated cryptocurrency in this field of digital money market, which Satoshi Nakamoto created as a peer-to-peer cash electronic system in 2009, and its cryptographic hash function was SHA-256 as proof of work scheme.

Just after the release of Bitcoin, another currency was launched by the name of Litecoin in the year 2011 and Namecoin was also created during the same year. Scrypt was the hash function of Litecoin. Peercoin was a great induction into the crypto market and drew everyone’s attention soon after its release.

People can buy and sell things through cryptocurrencies. Moreover, they can invest their money through these cryptocurrencies. Cryptocurrency is enchanting for all of us and excites us to invest, but it is a necessary thing to learn about risky trading via crypto before investing. It is better to understand how this system works, and after that, you are ready to invest and earn profits on a regular basis. It is suggested to do thorough research on cryptocurrency in advance.

Cryptocurrency is a digital currency, and it is considered to be a decentralized form of money. It is very important to protect the use of money for more than one time. For that specific purpose, blockchains are used as a central server for record-keeping of spending and transactions. When you make transactions via cryptocurrency, the record of these transactions imprint on the blockchain in the form of blocks. It’s just like a diary in which you write down your daily activities. Every page of that diary is a block, and the whole diary is a blockchain that contains all the data. Every time a transaction is made, the previous record is updated into a new form, and the beneficiary is given a copy of that record. In cryptocurrency trading, fraudulent activities are checked by proof of work or proof of stake. Miners play an important role to maintain the legitimacy of transactions and are incentivized.

What is Cryptocurrency Exchange?

Cryptocurrency exchanges are the online places that provide you with an opportunity to swipe your cryptocurrencies with other kinds of cryptocurrencies. Moreover, people can exchange their cryptocurrencies for flat cash in any currency all around the world. The price value of a crypto asset is valued on the base of the current market price. Exchanges give the facility to deal in fiat money or in cryptocurrency. For example, on a US-based exchange, a person can buy a Bitcoin with US Dollar or can trade their Bitcoin for Ripple’s XRP. Cryptocurrency exchanges are legitimate platforms, and they have to follow the laws of the country in which they are operating. Every country has its own rules and restrictions, but some of the laws are common and should be abided by all, including:

• Anti-money laundering (AML) laws
• Know your customer (KYC) laws

For operating the exchange operation in any part of the world, exchanges have to obey the laws of that specific part of the world. Money laundering is a kind of corruption and thought to be an evil activity all around the globe. Anti-money laundering laws are implemented to stop the illegal movement of money through any legitimate channel of trading. KYC laws are also important where you must know about your customer and his business. It is better to keep a record of his identity information for security purposes. It is suggested to move forward in business with your customer when you are satisfied, and you have built trust between you and your customer.

Customers are asked to interlink their personal bank account with the exchange. In this way, customer can receive and distribute money, and exchange can keep an eye on it. It will make a person most credible as a customer. Exchange does this all to tackle any illegal trading and exchange of assets. Local regulatory authorities make and implement these laws to ensure security in their own country. There are two kinds of exchanges:

• Decentralized exchanges
• Traditional exchanges

Decentralized crypto exchanges operate without any pivotal system, and it works with a blockchain system where no data information is stored, and no currency is held. However, direct transactions take place among users via a decentralized exchange system. In a decentralized exchange, customers trade-in in proxy tokens. DEX does not require detailed information, and it is not centralized.

Traditional crypto exchanges are just like the traditional stock exchanges where customers perform buying and selling, and that trading is based on the latest price values of cryptocurrencies. Traditional exchanges are very different from decentralized exchanges, and customers have to pay for every transaction they perform with traditional exchanges. Some types of these exchanges deal in fiat currency, while others are compatible with Bitcoin, Litecoin and Ethereum. An example of a traditional crypto exchange is GDAX. This kind of centralized exchange requires a lot of information where fiat trade is possible.

Before choosing an exchange, make sure if it is credible or not. In addition, fees and payment is another thing you should know before choosing a crypto exchange. Regulation and restrictions under a specific country is also an important thing you need know about.

10 Best Cryptocurrency Exchanges

When we talk about the cryptocurrency market, we often think about different names operating worldwide to make sure every transaction is accurate, and it is sometimes difficult to choose between them. Before choosing an exchange, it is important to know about a few things in advance, including:

• Fees
• Payment procedure
• The validity of that exchange in your own country
• Supported cryptocurrencies
• Rules and regulations by higher authorities

 More than 1000 exchanges are providing services, and some of the best are the following;

1. Coinbase
2. Binance 
3. Coinmama 
4. Kraken 
5. Cash app
6. Gemini
7. Bisq 
8. Crypto.com
9. Probit
10. CEX.IO

Apart from these few crypto exchanges, there are many more, but above stated names are the most famous and premium among all. 

Coinbase

Coinbase is one of the top crypto exchanges in the crypto market. It charges a fee between 0.99-2.99 dollars. Coinbase is the most common cryptocurrency exchange used by local Americans, and it is valid in nearly every US state. Coinbase was created in 2012, just after the Bitcoin. The entry method on this exchange is straightforward as compared to the other exchanges. The foremost priority of every exchange is to maintain security standard and provide secure services to users. In the case of security, Coinbase has always stayed top-notch. Coinbase has another version called “Coinbase Pro”, and that version is comparatively premium. Coinbase has a license to operate in more than 41 US states. Some of the features of this exchange are listed below:

• This exchange has comparatively competitive fees.
• The liquidity of Coinbase is remarkably high.
• It has a very simple user-friendly interface.
• A large number of altcoins can be selected under this exchange.
• The user has no wallet keys in this exchange.

Binance

Binance is a top-class exchange, and it has been in business since 2017. It works like a commission man and charges fee from both sides. 

Binance charges a 0.1% fee from the taker and maker, and this fee varies with the volume of exchange but does not go below 0.02%. Binance offers a discount of 25% on using its own digital currency, BNB. Binance provides exchange services for a large number of cryptocurrencies and a few fiat currencies as well. Some of the notable features of Binance are the following:

• Charges low fee than any other exchange in the market.
• The charting process is a bit advanced in Binance.
• Various crypto trading pairs are available for trade.
• Binance is good for advanced users, and beginners may feel difficulty.
• Binance is not able to operate in several states of the USA.
• Not good for US people, but it is good for trading on an international level. 

Coinmama

Coinmama is another leading exchange with an advanced operating system that makes it less laborious to use for customers. Despite its high charges and fees, it a reliable and secure exchange. Coinmama is a reputable exchange and does not compromise on security and quality provision. 

• It is a bit costly than most of the exchanges in the market.
• A small number of payment methods are available.
• Coinmama operates only in a limited number of US states.
• For large investments and transactions, the system becomes slow and time taking.
• Coinmama supports only eight coins.
• It is easy to use and good for newcomers.
• Coinmama has a very simple and straightforward buying and selling method.
• It has a professional customer support team to assist users.

Kraken

Kraken is ranked among the top five cryptocurrency exchanges around the globe and is a busy platform with a lot of traffic every second. Kraken is famous for its liquidity and secure processing. Kraken was created in 2011 in San Francisco. Kraken is allowed to operate in almost every United States state except two states, including New York and Washington DC. Kraken deals in multiple digital currencies, and it has an updated option of portfolio tracking where customer can manage their personal portfolio as well. It is easy to use, simple and advanced exchange type with a reputable image globally. 

• Kraken is ranked in the top 5 crypto exchanges worldwide.
• The customer support team is always available to guide you.
• Kraken charges very low fees on services.
• The Head office of Kraken is established in the USA, and it operates in almost every state of the USA.

Cash App

Cash App is another exchange with a compulsory fee to be charged on every transaction. The volume of the fee varies with the changing market trends. Via Cash App, one can pay rents and money for the food. Moreover, you can pay at any retailer shop using Cash App on your phone. Cash is a peer-peer transferring system. Cash App on mobile allows any beginner to invest easily, and that makes it an ideal exchange for new investors. 

• Cash App is very simple to use.
• One can withdraw Bitcoin using this exchange.
• Trading is possible only in Bitcoin through Cash App.
• Using a linked credit card will charge a 3% fee on every transaction.
• This exchange has a withdrawal limit, and you cannot cross it.

Gemini

Lords of trading regard Gemini as the most secure and protected place in the global crypto market. Gemini offers a very simple and updated platform for buying, selling, transferring, and storing cryptocurrencies. Gemini was founded in New York by the Winklevoss twins. Gemini is a legitimate place for exchange in the US and all around the world. Gemini was named as the best exchange of the USA earlier, and it has worked with some famous companies, including Samsung. Gemini is the safest exchange place with a clean track record so far.

• The facility of using the Gemini app on the mobile phone is available.
• You can send and receive cryptocurrency using a mobile application.
• Gemini is a security-oriented platform.
• Large orders are handled with the help of OTC trade desks.

Bisq

Bisq is one of the best decentralized exchanges out there. Trading fees for these exchanges are payable in Bitcoin and BSQ, which is the native cryptocurrency of Bisq. Makers and takers, who are using the native digital currency of the company, will be paying 50% less than the customers using Bitcoin for trading. This decentralized exchange does not follow the KYC rules and regulations. It means a person with no identification issued from the government can access it because it does not ask for any verification. Bisq is a non-centralized and non-custodial exchange which means no one can approach the funds except the user itself, and it cannot be hacked as well. It is totally opposite to the Coinbase exchange, where a user has no wallet keys. It means in the case of a centralized system, you have no control over your precious assets, and in case of any suspicious activity, your account funds can be seized. Bisq gives you complete control over your assets, and it is less vulnerable than pivotal exchanges. Salient features of Bisq exchange are the following:

• Bisq is a decentralized exchange.
• It does not obey the KYC laws.
• Users have complete control of the account.
• More than 30 kinds of payment options are available.
• Active trading in Bisq is not possible.
• Trade volume is very little in this type of exchange.

Crypto.com

Crypto.com is a premium crypto exchange known globally. It has more than 1 million active users at the present time. With the help of Crypto.com, one can lend money, buy goods, transfer funds and receive transactions immediately. It charges a small amount of fee at in start as it gives you a free trading trial. Crypto.com will provide special discounts on using their native currency called CRO during trading. Crypto.com works on the win-win principle and focuses on the regular advertisement to attract more and more users daily. It is cheap and easy to use crypto exchange.

• You will get a 90 days free trial as a beginner.
• For those who are using Crypto.com already, this exchange will give a 50% discount on trade.
• Buying Bitcoin via credit or debit card is totally free.
• Sharing crypto is swift and easy on Crypto.com.
• You will get a high level of liquidity from Crypto.com.
• The longer procedure of customer verification does not exist, and Crypto.com is very easy to use.

Probit

Probit was launched in 2018, and it is a Korean-based exchange that charges a fee of around 0.2% on every trade. It is a famous exchange that does not let you feel any problem regarding liquidity. The probability of using multiple coins for trade is very high on Probit, where you can trade in more than 300 different cryptocurrencies under one roof. Moreover, Probit has over 580 market pairs for trade as well. Holding a Probit token will let you earn annual interest on a regular basis, and you will be given a special trading discount as well.

• Probit provides language support in 38 countries.
• You can pay the lowest possible trading fee if you have a Probit token.
• Multiple options of trading coins are available.
• Probit owns an application, and it is ranked in the top 10 exchanges of the world.

CEX.IO

CEX.IO is an active trading platform with more than 3 million users at the present time. There is no special skill required to trade on this platform, and newcomers and experienced both can make huge profits. CEX.IO is often termed as the world’s oldest exchange as well. It is a US-based cryptocurrency exchange.

• You can sell coins and get profits in fiat money instantly.
• Mastercard facility is also available on this exchange.
• CEX.IO has an app compatible with android devices and mobile phones.  
• Good for beginners and pro traders.
• CFD trading provides margins.

Conclusion

Above discussed exchanges are best around the world, and all of them can be used for cryptocurrency trading. Some of these exchanges are country-specific, and others are able to carry out their operations in every corner of this world. Exchanges are the legal places for trading, and every exchange is answerable to the specific country in which they are working. Cryptocurrency exchanges provide a secure place for buying, selling and storing assets, and every exchange has its own way to do so. Every exchange wants to attract more and more customers, and for that specific purpose, each one of them tries to provide the best services for their customers.