How do you set up an account on a cryptocurrency exchange?
How do you set up an account on a cryptocurrency exchange?
Crypto exchanges are often a necessary part of trading, facilitating the purchase and sale of different assets. But how do you know which exchanges to use, or where to begin? This article will give you a broad overview and get you started.
Centralized or Decentralized?
Exchanges largely come in two forms at present — centralized and decentralized.
Centralized exchanges host all their involved trading action in one location. You can sign up for accounts with login details, etc., transfer funds to the exchange, and complete your trades on the platform. Coinbase and Binance are two examples of popular centralized exchanges.
Decentralized exchanges, or DEXs, in contrast, let you buy and sell with other users directly on the blockchain. You can go to a site such as Uniswap, connect your crypto wallet, and trade for assets you want. The exchange platform automatically connects buyers to sellers on the backend.
Choosing an exchange
Choosing between these two types of exchanges can depend on a number of factors. In the crypto world, all available digital assets are not generally found in a single location, so you might have to use more than one exchange, especially when taking advantage of exchange listing news and other timely events.
CT Markets Pro, for example, notifies you of new exchange listings in real time, which can often move the price of related assets. In the case of Coinbase, for example news of new exchange listings had an average positive price impact of around 50% in 2020.
Picking which exchange or exchanges to use also largely depends on your location. If based in the United States, you will have fewer options due to regulations from the U.S. government. Common U.S. exchanges include Coinbase, Gemini, Kraken and Binance.US.
Click here to read more about using exchanges as a U.S. person.
Regulation is unclear at present regarding the use of decentralized exchanges by U.S. persons, and you can read more about how to use the popular decentralized exchange Uniswap here.
Available exchanges
A bevy of exchanges exist for non-U.S. persons. Binance and KuCoin are two exchange options offering a vast number of crypto assets for trading.
Many crypto exchanges have fallen victim to a hack at some point in their history — and although security is constantly improving, most crypto pros will advise you not to keep your coins on an exchange except when actively trading because of an old maxim, “Not your keys, not your coins.” Essentially this means that when an exchange holds your coins, you’re no longer in direct control of them.
For other exchanges, check CoinMarketCap’s list, but also be sure to read the terms and conditions of any exchange you sign up for, as some exchanges also ban regions other than the U.S.
Signing up for exchanges as a non-U.S. user should be fairly straightforward, often just requiring a few simple details, such as an email address, although some exchanges require additional details on customers for certain withdrawal sizes, etc.
Exchanges such as Binance and KuCoin often list a broad number of assets comparatively earlier than other exchanges, such as Coinbase for example, so using these exchanges can give you access to a broader range of assets. Asset availability can be important considering the array of cryptocurrencies and potentially actionable data coming through on the Cointelegraph Markets Pro platform.
Among decentralized exchanges, Uniswap and 1inch are two popular options offering numerous assets for trading. These exchanges often list assets very quickly.
For more information on DEXs, including a guide on getting started, click here.
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