Beyond fees, when choosing the best crypto exchange for your needs, consider things like security, trading volumes, educational resources, and whether an exchange lists the cryptocurrencies you want to buy.
As crypto has become more popular and more valuable, it has become a big target for hackers. Major exchanges like Binance and KuCoin have been hacked resulting in tens of millions of dollars in losses. While exchanges often refund those whose coins are stolen, no one wants to be in that position in the first place.
You can minimize your risk by spreading your crypto purchases across multiple exchanges. You can also make a habit of moving your crypto holdings from an exchange’s default wallet to your own secure “cold” wallet. These are storage options that are not connected to the internet, making them nearly impossible to hack, although you must carefully save your password or you could lose access to your crypto forever.
Carefully consider the cryptocurrencies available on a given exchange. You could very well use a crypto exchange that only trades a few coins. Conversely, if you are a crypto enthusiast, you might want to access all of the 600+ available on Gate.io.
The availability of parts alone is not sufficient if there are no ongoing exchanges. Ideally, you will want to check that there is sufficient trading volume in your target coins to ensure liquidity, so that you can easily trade your coins and dollars.
Low volume markets could cost you dearly in sales. If there isn’t a lot of volume and you place an order, it’s called slippage. You might end up buying at a higher price or selling at a lower price than you would like.
If you’re an advanced crypto trader, you might want to make sure your preferred exchange offers the types of trading, like limit orders, that can prevent slippage by setting a firm price, and the margin you want. . Keep in mind that the types of exchanges involving these are still changing in the United States, so different exchange offerings may vary over time.
If you’re new to cryptocurrency, look for an easy-to-use platform with plenty of educational resources to help you understand this complex and rapidly developing market.
Finally, don’t assume an exchange is available in your country, or even state, just because you can access their website. Many state and federal governments are still figuring out how exactly they want to deal with cryptocurrencies from a legal and tax standpoint.