Top 5 Bitcoin/Cryptocurrency Exchanges supporting Fiat
Beginners often ask how they can buy a cryptocurrency for fiat money. You need to use special websites for achieving this goal, known as exchanges. This is a platform where people can buy one financial asset for another. There are several types of exchanges. Every one of them has its specific advantages and disadvantages. Let’s consider them.
Types of cryptocurrency exchanges
The basic types of exchanges where people can buy Bitcoin or other cryptocurrencies for fiat money:
- The real exchange. You can buy cryptocurrency here and decide what you want to do with it. You can sell it at a better price and take the money in dollars, euro, or other classic currency. Also, you can use cryptocurrency as a payment method.
- The Forex exchange. There, you can buy CFD contracts, which are special financial instruments. You don’t buy cryptocurrency directly, but you buy a contract that costs similar to a certain cryptocurrency. This is a trading instrument. If you want to buy the cryptocurrency for making payments, this financial instrument isn’t for you. This instrument is much riskier than trading on the real exchanges. You’d better diversify your investments in fiat money between both the real exchanges and Forex.
- Binary options. This is also a trading instrument, but it is the riskiest, and we recommend using it only if you aren’t a beginner. You need to predict the direction of the cryptocurrency price movement. If your prediction is correct, you get the higher part of your fiat investments in fiat money. If your prediction is incorrect, you lose all your investments. This activity is not associated with buying cryptocurrency at all. You are not supposed to be confused by the binary options platform. Before you choose the exchange, you’d better ensure that this platform isn’t a binary option.
First, you need to figure out what your goals are. If you want to trade, you can choose both Forex and cryptocurrency exchanges. If you need actual cryptocurrency, your choice is the cryptocurrency exchange. Mostly, all cryptocurrency exchanges are known as a place where you can trade.
There are some criteria for choosing the right exchange:
- Is the official office near you or at least in your country? It helps in solving a lot of problems, such as losing the money or technical issues.
- How convenient and easy an interface is. That’s necessary because many money losses are associated with inconvenient interfaces. This factor becomes more valuable when the price of cryptocurrency changes very fast.
- The number of trading pairs and certain cryptocurrencies. On one side, the more cryptocurrencies are available, the more possibilities for investing and trading there are. On another side, platforms can add unknown tokens. This is one of the methods of earning money. This is associated with additional risks of investing money in a coin that was created by dishonest people.
- Trading instruments and different features that are proposed by the exchange. For example, a person can check the possibility of making a stop-order. This feature is very important because it allows the buyer to buy or sell cryptocurrency at a specified price. For example, a stop-loss order closes the position if the price reaches a certain level. Staking is the second useful instrument. Some exchanges allow you to get a passive income for keeping coins. This is something like bank deposits, but this instrument doesn’t guarantee an income in fiat money because of high cryptocurrency volatility. If the price falls, the user loses his money. Most cryptocurrency exchanges support leverage, which is a possibility to increase the investments using the money of a broker or exchange (depends on the type of cryptocurrency exchange). However, risks are also higher. For this reason, if you are a beginner, we recommend you not to use this instrument.
- We recommend you check the volumes of orders on the exchange. You can do this with services such as Coinmarketgap and CoinGecko.
Also, you need to pay your attention to the process of registration. A lot of beginners don’t read the user agreement. Yet, you need to do this if you want to keep your wallet safe. For example, some features aren’t available for the citizens of some countries.
Let’s say, you found the perfect company with a very generous bonus and make your deposit. Then, you realize that this company isn’t so good. You want to change it, but you understand that you need to confirm your identity for getting your money back. The least you would need is time to do it, but you also don’t want to give your personal data to this company. If you read the agreement, you can understand these moments before registering.
Withdrawals and other money aspects
The number of payments and withdrawal methods is very important for understating what disadvantages of a certain company are. The more payment systems collaborate with a cryptocurrency exchange, the more famous they are, the more trust you can give this exchange. The reason for this is in the fact that payment systems don’t collaborate with the companies known as scammers.
At the same time, even this fact doesn’t mean that you can relax in this case. Your money is your responsibility. Also, you need to pay your attention to commissions. The lower they are, the better for you.
Which exchanges are the best?
The safest exchanges are decentralized exchanges because money from users are kept on their own wallets. There are three examples of decentralized exchanges:
- Binance DEX
- Poloni DEX
There are more reliable exchanges. You know the criteria. Good luck!