In this article I will discuss the most popular bitcoin exchanges, advantages and disadvantages of each, and strategies for beginners new to cryptocurrency.
In the world of crypto there are many exchanges to choose from- though many offer different tools and layouts, the main concern of an exchange is its long-term stability. Many exchanges today do not have the server capacity or capability to handle the influx of new users and money to come. If an exchange crashes it is taking your money with it, so your choice of exchange is very important.
Important Reminder: An exchange is not a wallet. Bitcoin trading sites are not wallets. If you wish to keep your investments in the long term, it is important to download a wallet for your cryptocurrencies. Many cryptos offer wallets for their currencies, many of which for mobile devices and secure applications on your computer. You will still need to buy cryptocurrency on an exchange, though it can be withdrawn and transferred to your wallet.
With all of that being said, here is my personal list of bitcoin exchanges I would consider most reliable.
Coinbase is undoubtedly the most trustworthy place to buy Bitcoin, Ethereum and Litecoin. The only problem is that these are the only cryptocurrencies coinbase offers.
Coinbase is the only reliable website to buy bitcoin with a credit or debit card in the U.S.
(If you are not located in the U.S. you have other options, such as Bitstamp, CEX, and others)
Coinbase is also incredibly user-friendly, undoubtedly the best choice for a first-time bitcoin and crypto investor.
It is available in Japan, Korea, Europe, and is opening in many other countries that are eager to join the market. As more of these countries open coinbase and other exchanges, the value of crypto will continue to rise.
The process of buying via coinbase is simple, as they only require pictures of you as well as an ID for confirmation to buy via credit card.
Credit and debit card fees are expensive.
Coinbase has a 4% cut on credit and debit card purchases, which is also taxed. If you buy $300 worth of bitcoin, expect them to take about $16. Credit card purchases are also limited to $300 for your first week, though the limit increases with purchasing.
With further verification on the website, you can connect your bank account which has a 1.5% fee, with tax. Connecting your bank account also allows $5000 in deposits, and more liquidity with the ability to transfer money more easily.
A common strategy for beginners would be to purchase with a credit card on coinbase while waiting for verification to connect your bank account to coinbase or another exchange. If you are to connect a bank account for bank transfer, it may be best to do so on a different exchange. Regardless of where you choose to connect your bank, the verification process takes a long time. For most people it takes under a week or two, though in some cases users have cited it taking months before being verified.
Kraken offers a flat fee for bank withdrawals and deposits, which is often the best option if you are looking to deposit and withdrawal larger sums of money. A flat $5 deposit fee is much better than the 1.5% offered by coinbase if you are depositing more than $300.
Kraken, in my opinion, is the most reliable exchange to trade for most of the top cryptocurrencies. They currently offer 16 currencies including bitcoin, ethereum, ripple and litecoin. It is not as beginner friendly as some, though it offers a bunch of useful tools. On Kraken, you can set up complex stop limits, allowing for your trading to be semi-automated with ease. For instance, with a trailing stop limit, I can set a currency to automatically sell or automatically buy if the price dips below a certain percentage. This is especially useful for periodical trading, if you are trading currency on a day to day basis. You can make a lot of money doing this, though you are assuming a lot more risk than simply holding your currency.
Kraken offers some of the lowest trading fees, and are very vocal and informative about fee changes and their reasonings. They do not offer credit/debit card transactions. To deposit to Kraken, you can go through the verification process to transfer funds directly from your bank account, or you can transfer Bitcoin and other currencies directly to the exchange.
If you are buying with a credit card on coinbase you can transfer funds directly using the withdrawal and deposit codes on each given exchange. Withdrawal fees can be hefty, though deposit fees are typically free or very light. Most are free on Kraken, including the top 4 cryptos.
Bittrex is probably less reliable than either Kraken or Coinbase, though offers a much larger variety of altcoins to invest in. There are over 200 altcoins listed on Bittrex. I would not recommend investing in many of the lesser known however. It is always smart to do your own research before entering a new market, especially when it comes to smaller cryptocurrencies.
A ton of news is available on our news page if you want specific information about specific cryptocurrencies.
Bittrex also has very user-friendly charts.
I would consider Poloniex to be the least reliable exchange listed on this page, though it deserves its honorable mention being the most popular exchange. Poloniex has had a rough time adapting to the large influx of new users on its website, and you can notice it through slower trading times, occasional crashes and pages taking what seems like years to load.
That being said, Poloniex offers a large variety of cryptos and very user-friendly layout compared to most other exchanges.