Are you looking for a cryptocurrency exchange platform that would comply with all your needs? Well, first, you need to decide what your needs are. Based on them, you can determine whether you need an instant crypto-exchange or a custodial platform. After that, you can choose one based on such criteria as reliability, availability of coins, customer reviews, safety, or whatever else criteria you might add.
An Instant Cryptocurrency Exchange: Benefits and Drawbacks
If you are looking for where to fast exchange cryptocurrency, your choice is an instant cryptocurrency exchange service. It offers its users significant benefits such as:
- No registration or KYC procedures: you can swap your coins immediately when you decide to do so. Sometimes, if your chosen Monero to BTC exchange offers to download a receipt, you can be asked to provide an email address.
- A significant variety of coins is available: you can trade even those cryptocurrencies or altcoins that are difficult to find on other platforms.
- Such platforms provide non-custodial services. It means that you are the only one who can access and manage your crypto-funds.
- Usually, such platforms offer to choose between a fixed or a floating rate depending on the traders` aim and demands.
However, there is nothing perfect. Instant cryptocurrency exchanges have their drawbacks, too. The most significant of them are the following:
- You need to have a wallet if you want to trade there. Such exchanges offer exclusively non-custodial services thus, no wallets are available. It means that such an exchange is suitable if you know how to handle a cryptocurrency wallet.
- Fees are higher than when you use a custodial service to swap your coins.
A Custodial Cryptocurrency Exchange: Benefits and Drawbacks
Custodial exchanges also enjoy popularity, and there are reasons for it. So, the main benefits of a custodial exchange are the following:
- A custodial exchange will offer you a wallet that supports all the variety of coins supported by the platform. Such wallets are extremely easy to use. While the service is custodial (the exchange has your private keys, not you) but the wallet benefits might outweigh this drawback.
- Usually, custodial exchanges work with fiat money and a number of payment options that are not accessible on instant exchange services: a bank card, bank account.
- Fees are lower than on an instant exchange.
A custodial exchange also has its drawbacks. Consider them before choosing this exchange type to swap your coins:
- A wallet is custodial. It means that you completely entrust your funds to the exchange, not you but the exchange has and manages private keys to your coins. If the exchange is hacked and the funds are stolen, your funds might be stolen, too.
- Such an exchange counts on its own liquidity pools, thus, in the case with rare coins, sometimes, might arise liquidity issues that might lead to transaction delays.
- Custodial exchanges require to pass a thorough registration process. Further, you will be asked to verify your account whenever you need to raise your trading limit. Usually, it is connected with the submission of piles of papers.
Now, you can choose between an instant and a custodial exchange more consciously. As an option, you can be registered and use the services of both exchange types.
