Crypto Shopping: Navigating the world of digital money with exchange platforms

For this week, I thought I would discuss crypto exchange platforms. A crypto exchange is a platform for buying and selling cryptocurrencies, which are two very important actions, basically the backbones, for anyone getting into cryptocurrencies. So, before you start your trading journey let’s talk about these platforms and get familiar.

Crypto exchanges are used for trade and offer price discovery through trading activity, and some even offer storage. However, it’s important to first differentiate between crypto exchange and crypto wallet. A crypto wallet is mainly a digital wallet that stores your cryptocurrencies, whereas a crypto exchange is a platform where digital transactions are primarily facilitated. Before these platforms existed, people had to work really hard to get their digital money by doing something called mining or by finding someone who had some to sell.

But now, there are many different crypto exchange platforms that offer lots of different digital money options, and some of them also keep your digital money safe.

Different crypto exchange platforms can have different prices and ways of doing things, so you have to look around to find the one that works best for you and makes you feel safe.

So, let’s discuss the advantages and disadvantages of crypto exchange platforms, how they work, and maybe even get down to which are the best ones for your needs.

Let’s jump right into some of the advantages of crypto exchange platforms.

• They can be super helpful if you want to buy or sell cryptocurrencies because they make it really easy to trade digital money without having to go through a lot of complicated steps. For example, you can usually just connect your bank account or credit card.

• Plus, many exchanges have helpful tools that show you how the prices of different cryptocurrencies are changing over time, so you can make informed decisions about when to buy or sell.

• And as for security, many crypto exchange platforms have really good security features in place to protect your digital money from hackers and scammers.

I know this is starting to sound a little too good to be true, but like all new and exciting innovations, there are some challenges involved. What are the things you should look out for from crypto exchange platforms? The two main things I will mention are regulation and manipulation.

• Regulation is one of the biggest challenges, since governments and financial institutions are still figuring out how to classify and regulate cryptocurrencies. Additionally, there are cybersecurity risks that come with storing and trading digital assets online.

• Another issue that can affect some crypto exchange platforms is market manipulation. This happens when someone tries to manipulate the price of a particular cryptocurrency in order to profit from it, which, although highly unethical, does happen sometimes.

Although risk is common in any established financial institution, the level of risk varies between crypto and other existing securities because of the regulations in place to mitigate these risks. It’s really important to choose an exchange with strong security measures, to avoid cybersecurity risks. Also, consider one with a good reputation and a track record of ethical behavior to avoid falling victim to market manipulation.

We’ve talked about pros and cons, now, what are the best platforms out there? Well, according to a recent article by Andy Rosen, who provided a list of top exchanges based on factors such as fees, security, user experience, and available cryptocurrencies, some top choices are: Coinbase, eToro, and Robinhood crypto to name a few. Let’s go through them.

COINBASE
• Coinbase is a well-established cryptocurrency exchange platform that allows users to buy and sell a variety of cryptocurrencies.

• It is available in over 100 countries and has more than 68 million registered users.

• The platform offers a user-friendly interface that makes it easy for beginners to start investing in cryptocurrencies.

• It charges fees that are relatively high compared to some other exchanges, but these fees can be reduced by using Coinbase Pro.

• Coinbase takes security seriously and stores most of its users’ funds in offline cold storage.

• It offers insurance protection in case of any losses due to security breaches.

• Coinbase supports a range of payment methods, including bank transfers, credit/debit cards, and PayPal.

• It also has a mobile app that allows users to buy, sell, and trade cryptocurrencies on the go.

• One potential downside is that Coinbase’s customer support has been criticized in the past for being slow to respond to users’ issues.

eTORO
• eToro is a user-friendly trading platform for both novice and experienced traders.

• The platform allows traders to invest in stocks, cryptocurrencies, and other assets.

• eToro has a social trading feature that allows users to copy the trades of successful traders.

• The platform offers educational resources such as webinars, videos, and blog articles.

• eToro has a mobile app that allows users to trade on-the-go.

• The platform charges no commission fees on trades, but instead generates revenue through spreads.

• eToro has a minimum deposit requirement of $50.

• The platform is regulated by financial authorities in the UK, Australia, and Cyprus.

ROBINHOOD
• Robinhood is a commission-free brokerage app that offers trading in stocks, options, ETFs, and cryptocurrencies.

• The app’s user interface is intuitive and user-friendly, making it easy for beginner investors to navigate.

• Robinhood offers a cash management account that earns interest and provides ATM access and debit card usage.

• The platform does not charge commission fees, which makes it ideal for small investors.

• Robinhood offers limited customer support, which can be frustrating for some users.

• The platform has been criticized for its lack of security measures and technical issues.

• Robinhood is a good option for beginner investors who want to start trading without paying commission fees, but experienced investors may prefer a more established brokerage with better customer support and security features.

This list only serves as a loose guide and you should do your own research and decide based off of your own pros and cons list.

In conclusion, crypto exchange platforms are an essential tool for anyone looking to buy or sell cryptocurrencies. They make it easy to trade digital money and offer useful tools for monitoring price changes. With proper security measures in place, users can feel safe and confident about their transactions. While regulation and market manipulation remain challenges, they are not unique to crypto and can be mitigated by choosing a reputable and secure exchange. By considering factors such as fees, security, user experience, and available cryptocurrencies, you should find the exchange that best fits your needs. Happy trading!

 

Dr. Donald Lim is the founding president of the Blockchain Association of the Philippines and the lead convenor of the Philippine Blockchain Week. He is also the Asian anchor of FintechTV.