Crypto Exchange: An Intermediary between Buyers and Sellers

Who would have believed twenty years back that the Cryptocurrency concept might become so powerful that it would almost overturn fiat money?

But if you say the same now, almost everyone will agree with you. Cryptocurrency is no longer a buzzword that people are not acquainted with.

The Cryptocurrency market is unprecedentedly evolving. The introduction of the Crypto Exchange platform has made trading effortless and seamless. One can vouch that the best service introduced in the Cryptocurrency landscape is Crypto Exchange – an intermediary platform where a seller and a buyer can connect easily. 

Before you jump on the bandwagon and put your footsteps in the intricate world of Crypto trading, it is imperative to know about the right Crypto exchange platforms. And some of the best platforms are Wazir X, CoinDCX, CoinSwitch Kuber, etc. 

Keep scrolling to know more about the trading process, factors to consider and types of Cryptocurrency Exchange platforms.

Crypto Exchange: Hassle-Free Trading

A Cryptocurrency Exchange is a platform where you can easily sell or buy almost any type of Cryptocurrency. It has now become feasible for a Crypto trader to convert regular currency into Cryptocurrency.

For instance, you can use US Dollars to buy Bitcoin. And while selling Bitcoins, you can easily convert them into fiat money as per the currency you want. However, investors are obligated to follow the provisions of the trading platform they are using.

How Does Crypto Exchange Work? 

The Cryptocurrency Exchange platform works as a mediator between a seller and buyer. This helps the buyer deposit the money using safe and secure methods like bank transfer, UPI, debit cards, credit cards, etc. However, there is a commission fee levied for using the exchange service. 

Different Types of Crypto Exchange

There are three types of Crypto Exchange as listed below:

• Centralised Crypto Exchange
• Decentralised Crypto Exchange
• Hybrid Crypto Exchange

Centralised Crypto Exchange 

In the Centralised Crypto Exchange, a third-party is involved in carrying out the transaction between the buyers and sellers. The third-party asks for a brokerage from both parties to execute a safe and secure transaction.

The best attribute of this type of exchange is that a government or other legal authority does not regulate Cryptocurrencies. The only risk is that these exchanges will be held by a single entity, making them vulnerable to fraudulent activities.

Decentralised Crypto Exchange 

In a Decentralised Crypto Exchange, no third party is involved in carrying out the transaction between the buyer and seller. 

A Decentralised Crypto Exchange is more authentic and safe than a Centralised Crypto Exchange. The brownie points here are its prompt process and low transaction fees.

Just like there are two sides of the same coin, in the same manner, Decentralised Crypto Exchange has its own cons. It is difficult for newbies to trade via this form of Crypto Exchange because it doesn’t offer easy transfers from banks, debit or credit cards for buying Crypto. Another drawback is it does not allow users to use fiat Currency Exchange.

Hybrid Crypto Exchange 

Hybrid Crypto Exchange simply means blending the advantages of both centralised and decentralised exchanges into one. The prominent goal is to provide end-users with the convenience of a Centralised Exchange and offer security just as a Decentralised Crypto Exchange.

What to Look for Before Investing in Crypto?

Before selecting the right Crypto Exchange platform, it is mandatory to consider your needs and align them with your Crypto strategy.

Accessibility – Where is Crypto Exchange Permitted? 

One of the prominent factors you must look for while doing a Crypto Exchange is accessibility. Before you choose to carry on with your Crypto Exchange process, make sure that your area, city, state, or country permits you for carrying out a Crypto Exchange. Furthermore, it is vital to ensure that Crypto Exchanges are limited to specific locales only. 

For Example – In China, it is not permitted to carry out Crypto Exchanges. 

Security – How Secure is Crypto Exchange?

The Crypto market is volatile and unsteady, which simply denotes less credibility and authenticity. Additionally, the advancement of hacking techniques makes buyers and sellers vulnerable to cyber threats. Therefore, it is essential to select a trading platform that offers insurance and cold storage for keeping your coins with utmost ease and security. Some of the best and most secure platforms for crypto exchange in India are CoinDCX, WazirX, CoinSwitch Kuber, Unocoin, and Zebpay. 

Liquidity – How Much Does Your Crypto Exchange Offer?

Liquidity plays an essential role during times of uncertainty, especially when it comes to Crypto markets. Also, less liquidity means prices can rise or fall drastically at any time. 

Just remember, exchanges with higher trade volume and more money transactions work best in an investor’s favour. 

Coins – What Kind of Crypto Can You Trade?

Generally, Cryptocurrencies with higher market reach are available on the exchange platforms. Not all of them are offered on all the trading platforms. Some of the popular Cryptocurrencies are Bitcoin, Litecoin, Ethereum, etc.

Fees – What are the Fees Levied on Crypto Exchange Transactions?

For some people, Crypto Exchange fees play a crucial role. But it all depends on your financial goal. Crypto Exchange fees vary widely as per different trading platforms. But never let higher fees be an obstacle. It is so because higher charges can also mean a highly secure protection system.

Summing Up

If you are dealing in Cryptocurrency, then remember you are putting your money in a volatile environment. The blockchains, coins, and exchanges are largely unregulated, and investors usually speculate on price movements. It is a pressing priority to be cautious and get acquainted with all the factors since you are one step closer to hitting the jackpot.