Posted By Stephan Jukic – June 24, 2018
Buying and selling cryptocurrencies has never been easier thanks to the sheer number of crypto exchanges scattered across the internet in 2018. Not only are there dozens of platforms available, they also offer different options for things like buying into tokens with fiat money, trading between different coins and storing coins long term.
However, the simple fact that there are so many exchange options available on the web today can make the whole thing really confusing for actually deciding which exchange you should start using with a minimum of fuss. This quick guide breaks all this down to the essentials by presenting you with the most important factors you need to keep in mind, giving you the most fundamental definitions of an exchange and finally presenting you with a list of the 10 best crypto exchanges in existence right now for getting started immediately as a trader or crypto investor.
A Quick Note On Terminology
Throughout this post we use the words “cryptocurrency”, “crypto”, “crypto assets” and “token” interchangeably. Try not to let this become confusing by bearing in mind that they all refer to the same basic thing: cryptocurrency units like Bitcoin, Ethereum units, Litecoin, Ripple and all possible altcoins (newer coin types with smaller market caps). By contrast, when referring to conventional government currencies like dollars, Euros, Pounds etc, we use the term “fiat”.
Crucial Things To Keep In Mind Before Picking An Exchange
Before we get around to all the meaty details about crypto exchange types and the best exchange platforms for each type in 2018, the following are the key points you should keep in mind when picking any kind of cryptocurrency exchange for your needs. Not all of the following apply to every crypto user but they’re all worth knowing:
Exchange type: This is exactly what we’ll cover in detail further below but basically, do you already have easily tradable cryptocurrency like Bitcoin or Ethereum? Some crypto exchange types only accept deposits for trading in crypto while others let you buy crypto through them via fiat deposits. In other words, what currency type are you starting with?
ID & Verification Requirements: If you just want to buy and trade, these shouldn’t be a problem for the most part but most crypto exchanges today, especially fiat-to-crypto exchanges that let you deposit and withdraw fiat require verification of banking details and personal identity with official documents. There are anonymous exchanges out there and some that even allow fiat purchasing without asking for ID but they’re less common these days. If anonymity is something you prefer, you should stick to these. We cover which require which in our listings.
Geographical Restrictions: Most crypto-to-crypto exchanges are fully global; if you have an internet connection and crypto to trade, you’re good to go with them unless your country’s own government has banned cryptocurrency trading (as some governments have). For fiat-to-crypto exchanges however, geographical restrictions are more common. Many of them only accept users from certain countries or exclude users from specific places. You’ll quickly find out if you’re accepted when you try to get verified with these but it’s good to check in advance with their customer support or FAQ page before wasting more time on a platform that might not even want you.
Website & Server Safety: Not all exchanges are equally secure and while it’s almost impossible to be sure that any one exchange doesn’t have hidden security weaknesses or dishonest owners, you should at least due your basic due diligence in making sure that the exchange you want to use has a good reputation among professional analysts for securing customer accounts, assets and transactions. The exchanges we list below are all reputable as far as we know to-date.
Liquidity levels: Traders who only want to play with a few hundred or few thousand dollars per month don’t need to worry about this with any half decent exchange, but if you’re planning on moving hundreds of thousands of dollars’ worth of crypto frequently, go for an exchange with high trade volume and lots of liquidity for major transactions.
Exchange fees: Virtually all crypto exchanges charge some sorts of fees for their services but the scope of them can vary enormously. Make sure the exchange you use has a clearly defined fee structure and that those fees won’t eat into your returns. If you’re planning on doing lots of trading between cryptocurrencies, then you need to pay particular attention to transaction fees. Some exchanges only charge “larger” fees for withdrawals and deposits while letting you trade between crypto tokens very cheaply or even for free. These are your best bet if you want to do lots of monthly trading.
Payment (funding) and withdrawal (to fiat) options: This factor applies only for Fiat-to-crypto exchanges since pure crypto exchanges deal only in trades between different types of cryptocurrencies. However, if you want to change fiat into crypto or vice versa, the more versatile the funding and withdrawal options your crypto exchange supports, the better.
Withdrawal and Deposit Limits: Pure cryptocurrency exchanges rarely apply limits to how many tokens you can move in and out of them or trade inside them; as long as the liquidity for trading is there, you’re usually good to go on the trade volume of your choice. Where there often are limits however is in fiat-to-crypto exchanges in terms of cash withdrawals and deposits. These are usually in place for reasons of money laundering regulations and user trust. Check specific limits for any fiat exchange you sign up with. Some of them may let you sell large volumes of coins for fiat but only let you send the fiat itself to a bank account with strict daily withdrawal limits.
Customer support: Customer support can vary enormously across exchange types. P2P platforms usually offer the weakest customer support while fiat-to-crypto trading platforms and crypto broker platforms tend to offer the most robust.
Supported cryptocurrencies/tokens: More isn’t always better, unless sometimes it is: The more cryptocurrency token types an exchange supports, the better it is for users who want to do a lot of speculative trading, but this can also mean a much more complicated or confusing trading interface for your account. If you just want to buy and hold one or two major currencies, then platforms with support for only a few major token types should be fine. They’re a lot easier on usability and usually also support withdrawals to fiat.
Trading pair options: Trading pairs are two cryptocurrencies that can be directly traded for each other. The more of these pairs, the better for trading-oriented crypto exchange users. This is because numerous trading pair are a crucial factor for crypto exchange users who want to shift token assets quickly when the market moves. The more trading pairs an exchange supports, the more fluidly you can exchange your assets from one cryptocurrency to another for the sake of creating gains.
User friendliness: Some cryptocurrency exchanges are geared more toward professional traders and offer dozens of trading pairs, hundreds of coins and numerous price analysis tools. These can be overwhelming for beginner traders and especially so because they mean understanding technicalities about both crypto AND trading in general. Other exchanges offer very basic trading options for a limited range of tokens. If you’re a beginner, we’d suggest first getting the hang of buying and selling coins by starting with a simple exchange that only supports a few major tokens. Once you feel comfortable with a simple, intuitive user interface, move onto a crypto exchange with numerous coins.
A Word On Exchange Wallets & Bitcoin Wallets.
All cryptocurrency exchanges by default give you a cryptocurrency wallet address for each of the token/coin types you have with them when you open an account. However, these wallets can have variable security and as a general rule are NOT to be mistaken with cryptocoins wallets for simple token storage. The two are not the same thing.
It’s a good idea to keep only funds you’re actively using for currency trading inside crypto exchange addresses themselves. Crypto assets for long term storage in the form of a more “stable” token type should be moved to a dedicated online wallet, an even more secure software wallet with offline functionality or even more securely, be kept in a hardware wallet like the Trezor and constantly offline.
Types of Exchanges
A clear definition of exchange types is also in order before we get down to the list itself of the top 10 cryptocurrency exchanges of 2018. This can get a bit complicated but the most basic breakdown of the different kinds of systems goes as follows: While crypto exchanges can be subdivided into several different categories and service niches, the two most fundamental exchange types are the following:
Fiat-to-crypto (fiat) Exchanges
Unless somebody paid you directly in crypto or gave you some in a wallet address, the first thing you need to do before trading cryptocurrency of any kind is buy it with fiat money (US dollars, Euros, pounds etc) so you can own coins like Bitcoin, Ethereum and so forth. This is what Fiat-to-crypto exchanges offer. They’re portals to owning crypto coins because they let you turn your dollars or other government currency into coins like Bitcoin, Ethereum and other crypto currencies.
Most fiat-to-crypto Exchanges work as broker services, or “traditional” trading platforms and ask for ID verification before you can transfer funds into them for buying your first coins. Some however are P2P platforms that let you buy directly from other users at whatever prices they set.
Crypto-to-Crypto (Pure Crypto) Exchanges
Once you’ve managed to exchange fiat for some type of crypto currency, you can move that currency across a much larger range of exchanges and many of these will be crypto-to-crypto platforms. In other words, they only offer the option of exchanging one kind of crypto for another. Crypto-to-crypto exchanges tend to offer way more coin trading options than fiat Exchanges but if you want to convert coins you’ve stored on them back to fiat, you’ll need to send them to a fiat-to-crypto exchange again first.
Crypto-to-crypto exchanges don’t usually ask for ID verification but may be centrally managed by a business entity which takes a commission from each transaction. Several examples of an exchange like this are covered further below.
Another type of crypto-to-crypto exchange can be a P2P platform (also more rarely called a direct exchange). In the case of these exchange types, cryptocurrency is traded directly between buyers and sellers who set their own prices with the platform’s administrators acting as nothing more than referees who protect both parties through escrow services and platform security maintenance.
One further type of exchange exists that is something of a hybrid between both fiat-to-crypto and pure crypto exchanges. In the case of this type of platform, users may in some cases buy into trading with fiat deposits but cannot perform fiat withdrawals. We’ll mention one or two of these further down.
The Top 10 Crypto Currency Exchanges of 2018
Now let’s get down to the list of our top picks for both fiat-to-crypto and crypto-to-crypto trading, divided by broad category:
Once again, these are crypto exchanges that allow for trading between different types of cryptocurrencies but also offer support for conversion of tokens to fiat (U.S dollars, Euros etc) and deposit of fiat or withdrawal of fiat to bank accounts. Most fiat exchanges have strict ID & verification requirements.
Probably the single biggest and best known fiat-to-crypto currency exchange in the world, Coinbase is as established and trustworthy a player as you can find. With at least 14 million users and billions of dollars in customer assets under management, the company offers a limited selection of coins to trade from but it does let you quickly open an account and fund it with cash for buying your first coins quickly and easily. On the downside, Coinbase only offers a limited selection of coins and its transaction fees can be steep.
Pros: extremely strong reputation for security, low transaction fees, easy account setup, great liquidity
Cons: Limited cryptocurrency support (you’ll need to open a Coinbase owened-GDAX account for trading numerous altcoins), available only in some markets, weak customer support
BitStamp is based in the European Union and offers one of the more reliable buying and trading options for Bitcoin and other crypto tokens in 2018. It’s been around since 2011 so the platform’s reputation is more than established and the security features for trading or storing your coins with the exchange are very robust. It also offers 24/7 customer support and free account openings, which are both nice bonuses. BitStamp is not exactly beginner-friendly however and its deposit fees are a bit hefty.
Pros: very strong reputation for security, some transaction fees low, good liquidity
Cons: Weak User Interface, limited cryptocurrency selection
The Winklevoss twin brothers are famous as serious investors in the world of crypto currency and they’re also the founders of Gemini, which is based in New York and offers depositor security that’s almost on par with what a bank delivers. This particular exchange gives its users FDIC insurance for their funds and some excellent customer support, making it a great option for beginners. On the other hand, the range of crypto currencies they support is limited and so are trading options.
Pros: Extremely secure so far, FDIC insurance, great customer support
Cons: limited crypto selection, restricted to U.S customers
Unlike the others above, LocalBitcoins is a P2P exchange. In other words, it matches people who want to buy crypto coins with people who want to sell them at whatever prices they set between each other. Buying and selling can be done online by exchanging banking details and wallet addresses through the LocalBitcoins buyer/seller messaging interface but many users also meet in person for their trades. LocalBitoins is the easiest option for buying crypto anonymously but it can be risky since third party protection is limited. LocalBitcoins only supports Bitcoin transactions at this time but a very similar platform called LocalEthereum also exists for trading Ethereum tokens in exactly the same way.
Pros: No ID verification required, no fees for most transactions, very user friendly and supported worldwide
Cons: Large transactions are difficult, communications with sellers and buyers can be time consuming, formally only supports Bitcoin trades.
CoinMama is the instant crypto buyer’s friend. It does require formal ID verification but once you jump through this step, the exhcnage lets you purchase assorted types of coins like Bitcoin, Litecoin and Ether by credit card instantly. The markup for buying these tokens in this way is a bit steep but the platform is one of the simplest and easiest methods around for buying major cryptocurrencies with fiat almost instantly. CoinMama charges rather steep fees when you buy your coins with them but it’s available in multiple markets around the world.
Pros: nearly instant buying of crypto without ID verification
Cons: High purchase fees on some transactions limited crypto selling features.
These exchanges don’t come with funds deposit options but they do offer a massive range of trading options for users who already own crypto coins in a wallet or one of the fiat-to-crypto exchanges we listed above.
One of the absolute biggest crypto exchanges in the world, Binance has been growing like crazy due to its ease of use and huge range of coin trading pairs. It’s also highly secure and offers high liquidity even for large trades. The fees are low and the platform even has its own crypto coin, the Binance Coin, which was released in 2017. Opening a Binance trading account only requires email verification.
Pros: Extremely high liquidity, support for dozens and dozens of cryptocurrencies, user-friendly, easy to open an account.
Cons: No support for fiat currencies, weak customer support.
Bittrex is an excellent U.S based trading platform for users who want highly regulated asset security and a huge range of coin trading options. The site lets you convert among over 190 different crypto currencies at a time and lets users set their own prices, on top of which it charges a tiny platform use fee of less than 1%.
Note: Bittrex is reportedly going to start accepting fiat-to-crypto transactions for U.S dollars soon
Pros: Huge range of supported cryptocurrencies, flexible trading, low transaction fees
Cons: requires ID verification even for crypto withdrawals, withdrawal limits for BTC
Shapeshift is a great source for users who want to trade numerous cryptocurrencies anonymously and quickly without all the deeper hassles of creating a formal account or trusting an exchange to hold their funds for them. There is no fiat support or support for buying crypto with fiat via shapeshift but the platform also has no ID checks of any kind. However, if you already have crypto and want to trade it quickly, Yyu can use Shapeshift to trade between your coins and others with minimal hassle.
Pros: Solid reputation, easy to use, plenty of crypto tokens supported, low fees, no tedious ID verification.
Cons: No support for fiat currencies or buying crypto for fiat. The Shapeshift mobile app is mediocre too.
Not to be confused with the similarly named Bittrex, BitMex is the pro’s trading platform. This site is run by a highly competent team of high-frequency traders, web developers and even economists, so you can expect a robust trading platform for serious users. On the other hand, BitMex is geared more towards professional coin traders and even offers more exotic features like futures contracts for major currencies such as Bitcoin, Ethereum or Litecoin. Fees for using BitMex are low and email verification is all you need to get started.
Pros: Superb range of trading analytics tools, great platform for pro day traders, exotic trading features, no ID check required
Cons: not user-friendly for newbies, no fiat support despite pro trading options
Cryptopia is a fairly new New Zealand-baased crypto exchange that has a couple of very unique features going for it. First of all, it supports one huge range of cryptocurrencies, including major “stablecoins” like Bitcoin, Litecoin and Ether as well as many, many smaller altcoins with low market caps and limited trading options. There are also plenty of direct trading pairs available through Cryptopia for easy exchange between altcoins and major coins. The trading fees on this platform are relatively reasonable at 0.2% and Cryptopia even features a large market for services and products payable in crypto.
Pros: Excellent altcoin support, support for all major cryptocurrencies, reasonable trading fees, lots of trading pairs
Cons: User interface can be confusing, poor customer support
Poloniex is one of the oldest and best known of the major crypto-to-crypto trading platforms in existence. Its user interface isn’t the best for beginners but this platform does offer a large range of trading options among more than 100 different coins. There are also plenty of analytics tools available for more advanced traders. The platform does charge fees for certain types of internal trades but withdrawals are free.
Pros: low trading fees, strong reputation for security and reliability, supports dozens of cryptos, worldwide support
Cons: no support for fiat withdrawals and purchases, ID verification required