Exchanges are nothing more than places or online sites where you can find cryptocurrencies, buy and sell them at your pleasure, functioning as a sort of platform for buying and selling common shares. In them the user can consult the real time the value of the coins and exchange them for others or withdraw their cash value.
The bulk of the activity with virtual currencies is concentrated in them, since they are the safest and most reliable way through which to buy and sell the amounts they want. They are also a determining factor when it comes to operating with virtual currencies, since each exchange operates independently and have their own peculiarities and characteristics, such as not having a specific currency.
How do they work
Although the operation of the exchange platforms differs from one to the other based on the particularities that govern them, most of them have a series of similar patterns. The most obvious is the need for the user who wants to use this open platform to register with their personal data in order to be able to safely and privately exchange currencies.
This account will serve for the person to store the cryptocurrencies purchased on the same platform, for example, or to view the history of transactions carried out. Without prior registration, exchanges do not allow trading and, consequently, the world of virtual currencies cannot be accessed.
Types of exchanges
When choosing an exchange platform, it is necessary to assess the benefits offered by each one of them in order to be more successful with the decision made; the characteristics that for some are indispensable, others do not need them at all, for example. Its main features, however, do not usually reside in very specific functionalities, but rather in the way of operating the platform in general and, especially, in the cryptocurrencies that are available for purchase in each of them.
Let's look at some exchanges.
Coinbase is, most likely, the best-known exchange due to its simplicity. Anyone can register and open an account in a few minutes, after which they will be able to buy and sell a very small amount of coins, but among which are the main ones and those that everyone knows. Commissions are higher than others, but it is the ideal option if you want to avoid complexities.
Among those preferred by people who tend to recurrently operate with cryptocurrencies is the Kraken exchange, which is notably more complex to manage than the previous one but, in exchange, offers much lower commissions. If you already have experience in the field of online currency, this is one of the options to consider.
BitStamp is another of the platforms that is worth considering if one is starting in the territory of cryptocurrencies. This offers moderate commissions and only gives the possibility of trading with a limited number of currencies, but these are the most popular and will be sufficient for a large majority of users. It also has an interesting option to create secondary accounts with which to break down and divide spending.
HitBTC is one of the platforms of interest if you want to start by making a first investment in Bitcoin and then diversify or to transfer here a value that was already stored in another portfolio. It has a large number of currencies and low commissions, but exchanging fiat money for cryptocurrencies is not one of the peculiarities that the platform provides for the vast majority of them.
Another of today's greats is Bitfinex, which has a large number of currency pairs with which you operate, supports a large number of cryptocurrencies and has one of the most secure networks of the moment. If low commissions are added to this, there is little reason not to use it if the occasion arises.
Bittrex currently offers around 200 pairs of cryptocurrencies on one of the most comprehensive platforms that can be accessed. In the same way as the previous one, security is one of the predominant elements in it and it is an option that could be even more interesting if one is interested in a specific type of currency.
When it comes to making pure exchanges with cryptocurrencies, Binance takes the cake thanks to its policy of exclusively accepting transactions between virtual currencies and never physical money, so it is the preferred place for those who operate entirely in the virtual spectrum. It is reliable, safe and very fast.
If you are looking for variety at its best, then Cryptopia is an excellent place to start your operations with cryptocurrencies, since several hundred virtual currencies are collected on the platform that can be bought, sold and exchanged. Among the entry fiat currencies is not the euro, but this is only a minor problem in exchange for a consolidated and varied platform.
Gdax is a platform linked to Coinbase, less known, but also very simple and with lower commissions than the first. It also has certain limitations when exchanging currency pairs and other currencies, but it is a good option if you are looking for something more advanced than Coinbase without becoming too complex.
Poloniex is another of the greats of the moment, with a platform that is based on four pairs of currencies but that gives access to a few dozen more. It is not one of the most complete that can be accessed, but it renders its service well to those who so desire.
In the case of Cex.io, it is a company in full growth and that offers through its platform an exchange, sale and purchase of the main currencies, but nothing too extensive. However, they have interesting options that other platforms do not have, such as the possibility of making investments above the available balance in each account, which allows improving profitability in the long term.
Gemini is the first platform licensed to operate Ethereum in the world, and is dedicated to offering its services exclusively with that currency and Bitcoin. It is founded by the Winklevoss brothers, who are known for their demands on Facebook and Mark Zuckerberg, and it is a very safe and reliable service.
In addition to the previous ones, it is mandatory to mention Kucoin, a new exchange of Chinese origin that begins to have a certain audience in its database, despite the fact that it does not offer any differentiating features with respect to most of the platforms. It allows to operate exclusively with virtual currencies.
SatoshiTango is a curious project born in Argentina and specially focused on the inhabitants of that country, who can enjoy advantages such as the automatic conversion of their currency on the platform. This does not allow to store the purchased coins in it and only allows transactions with Bitcoin, so it is a kind of "bridge" to be able to later operate on other platforms transferring the amounts purchased.
For its part, Bitso is a platform focused on the Mexican market, where users residing in this country can benefit from very low commissions and enjoy a very exclusive exchange. It has operations in several of the main cryptocurrencies and it is a good place to start in the cryptocurrency landscape.
How to buy and sell
The easiest way to buy and sell cryptocurrencies is directly through exchanges or exchange platforms. There are other options, such as selling them directly to other people, but reliability is reduced. Carrying out this action through an official website guarantees that the protocol for payments and transactions will be respected in any case - as long as said website or online site is legit - and there will be no problem in this regard.
How do you know if it is safe?
Security is one of the most worrying factors when it comes to online currencies, since a small failure can cause losses of several thousand euros to the owners. This is why it is advisable to resort, whenever possible, to one of the exchanges proposed above, which have the necessary security guarantees and are backed by the use of millions of users around the world.
How to know the commissions?
When transferring a currency in an exchange service, either to be bought, sold or to another storage portfolio, it is usual to charge a percentage of commission for carrying out the mentioned transaction. This varies greatly between the different platforms –Coinbase, for example, is the easiest to use, but at the same time it has high commissions–, so it will have to be something to consult individually on the question page or support of each of them.