The definitive guide to crypto exchanges
Sometimes it becomes difficult to assess which exchange is best for crypto. There is not one answer but multiple ones depending upon what is the core strength of each exchange. Like software companies, every major exchange promises the whole laundry list of features but that does not mean they are equally strong in all of them.
In this guide, I am going to cover which exchange is best in each category primarily for a US based crypto holders. Lets list down the categories first:
- Market Making or Brokerage
- Over the Counter
- Initial Coin Offerings/ICOs or equivalent
Following is the list of platforms I have some experience with:
- Coinbase (Pro)
Market Making or Brokerage
To hold crypto assets, you need to buy them first. There are few determining factors for which exchange is most suitable for you. Some of them (but not limited to) are:
- Availability of Coins
- Connectivity with the Banks
- Deposit & Withdrawals
Marketing making essentially has two players: makers and takers. Makers make the order book by placing limit orders out of the money. The exchange with most users has the most liquidity i.e. Coinbase.
Availability of Coins
Coinbase has been considered gold standard for crypto listings. Kraken has been considered to have widest choices. I remember the time when XRP was only available on Kraken. Now Uphold is the only exchange which provides trading in XRP but that is for entirely different reasons.
With the exception of XRP, every major exchange now provides trading in all major coins. Robinhood being an exception. Robinhood only allows trading in BTC, ETH & DOGE.
Connectivity with the Banks
It is important to have connectivity with the banks. Once upon a time, this difference as huge between exchanges. Now with almost every exchange supporting plaid, this feature is not a differentiator anymore.
Deposit & Withdrawal Limits
Coinbase has the most generous daily limits when it comes to dollar deposits and withdrawals. Robinhood is most restrictive for transferring coins by not even allowing it.
Uphold has an interesting feature in which you can do daily deposits and buy a certain crypto with it (the dream of a person who strongly believes in dollar cost averaging).
Over the Counter
Over the counter platform are the platform you need when you want to make a big buy or sell of a coin. This was a major issue when the exchanges did not have enough liquidity. Genesis Trading has been a gold standard for otc trading.
Custody is a feature which large institutions need to make sure their crypto holdings are safe. Following are the leading custody providers:
Celsius is the supreme leader in crypto yields. Nexo is also good but is based out of US so some people may be concerned about it.
Initial Coin Offerings
This choice is easy as the answer is none. With SEC regulations less and less ICOs are available to american buyers.