Similar to the stock exchange allowing you to invest in stocks, the cryptocurrency exchange is an online platform where you can buy and sell cryptocurrencies. Some also called it the bitcoin exchange that you can trade bitcoin or exchange bitcoin to other altcoins. Cryptocurrency exchange also acts as a middle man between buyers and sellers.
Three Common Types of Cryptocurrency Exchanges
1. Traditional exchange
The traditional exchange allows you to purchase the USDT or BTC firstly with fiat cryptocurrencies, for example, US dollars, Euro, Pound, Ruble, etc. based on the prevailing exchange rate or market price. The common payment methods are credit card, debit card, Paypal, and wire transfer. Then, you can use USDT or BTC to exchange other popular and promising altcoins like ETH, XRP, EOS, and so on. Notice that this type of trading platform always charges a fee for each transaction. In addition, traditional cryptocurrency exchange generally requires you to do KYC for identity verification, which means you should upload your ID card to the platform.
2. Over the Counter (OTC) exchange
OTC exchange is more like a decentralized trading platform that supports direct peer-to-peer transactions between buyers and sellers. You can only use supported fiat currencies to purchase cryptocurrency. OTC exchange doesn’t provide a fixed market price for each kind of cryptocurrency. In other words, sellers can publish sale announcements with different prices for the same kind of crypto asset, and buyers can choose the lowest one to purchase. However, the amount of cryptocurrency that the one seller offered is quite limited. For example, if you want to buy 10 BTC, but the seller who sells it with the lowest price only has 1, so you can only buy 1 from it, and from others with a higher price. We found that the price of a kind of cryptocurrency that sellers provide in the OTC exchange is always a little higher than its market price. Though it’s more convenient to invest cryptocurrency directly with fiat currencies in OTC exchanges, investors are more willing to buy a cryptocurrency at a lower price in the traditional crypto exchanges.
3. Cryptocurrency futures exchange
Cryptocurrency futures exchange, namely, provides futures contract trading. A futures contract is an agreement to buy or sell a particular cryptocurrency at a predetermined price at a specified time in the future. You can leverage the futures trading which means you can enter a larger trade with a small amount of cryptocurrency that you hold. To conclude, cryptocurrency futures trading allows you to make profits when the market up or down, and maximize your profits with X times leverage added. This type of transaction is higher risk, but it allows you to set the stop-profit and stop-loss to control and lower the risks as well.
In general, traditional exchanges offer more cryptocurrency trading pairs to investors, and give more chance to the promising blockchain projects to get their tokens listed and traded in the platform.
OTC exchanges might be the easiest one among the three helping investors, especially beginners get familiar with cryptocurrency investment. People can start buying cryptocurrency directly with their fiat currencies.
Cryptocurrency futures exchanges are going to be the future of exchanges in the crypto market. The former two exchanges only allow investors to earn money when the market is up or call it the bull market. While futures exchanges enable investors to make profits even when the price of cryptocurrency fall or in the bear market. It also gives investors a chance to make greater profits though they possess a small number of assets. Certainly, higher profits with higher risks.
Now choose the kind of cryptocurrency exchange that meets your trading demand and start your journey to the crypto world.
xbt, xbtusd, xrp usd, bchusd, ethusd, bitcoin trading, xrp to usd, ltc usd, bitcoin leverage, perpetual contract, xbt/usd, bitcoin volatility index, xmr trader, bch usd, quanto, xrp/usd, xbt to usd, 100x bitcoin, xbt price, bch to usd, bitcoin leverage trading, eth usd, xbt futures, leveraged bitcoin trading, cross leverage, eth/usd, funding rate, eth trade, xbt usd, take profit order, beth, bitcoin volatility, ripple price, ethereum price, eth price, tezos price, cryptocurrency exchange, chainlink price, bitcoin trading, litecoin price, omisego, dogecoin price, waves crypto, crypto exchange, ripple price chart, cryptocurrency trading, xrp price chart, cryptocurrency prices live, crypto trading, ethereum price chart, ltc price, cryptocurrency exchanges, xtz price, cryptocurrency trading platform, crypto guide, bitcoin futures, bitcoin trading platform, etherium price, bitcoin price chart, live cryptocurrency prices, stellar lumens, bch price, eth price chart, algorand price, aave crypto, ripple chart, what is ripple, cryptocurrency exchange platform, live crypto prices, bitcoin exchanges, link crypto, icon icx, polkadot price, crypto trading platform, trade cryptocurrency, eosio, what is dogecoin, aave lend, litecoin uses, chain link price, trade bitcoin, bitcoin futures trading, omise go, filecoin price, cryptocurrency prices, best bitcoin exchange, staking coins, digital currency exchange, algo price, trading cryptocurrency, what is tezos, what is waves coin, polkadot coin, bitcoin marketplace, btc otc, bitcoin margin trading, tether crypto, atom crypto, what is zec, crypto prices live, tether coin, cardano ada, margin trading crypto, cryptocurrency margin trading, bitcoin exchange, monero price chart, algo crypto, eth chart, xtzs, etherum price, trading bitcoin, bitcoin exchange usa, dot price, cryptocurrency futures, margin trading cryptocurrency, cosmos atom, dogecoin chart, icon crypto, link crypto price, ether price, btc trading, cryptocurrency price, melon cryptocurrency, what is stellar lumens, what is cardano, cryptocurrency trading sites, xrp price today, digital asset exchange, what is xrp, digital currency trading, orchid oxt, bitcoin trading sites, usd coin, what is lisk coin, chainlink price chart, us crypto exchanges, knc price, crypto monnaie, lisk coin, chainlink crypto, cryptocurrency live prices, cryptocurrency trading platforms, buy and sell cryptocurrency, cryptocurrency type, pax gold, usdt tether, chainlink cryptocurrency, price of cardano, xbt price, cosmos crypto, otc crypto, dot crypto, staking rewards, ada price chart, xmr price, truth about bitcoin, oxt crypto, stellar cryptocurrency, what is bitcoin cash, types of cryptocurrency, otc bitcoin, melon coin, xrp chart price, chainlink chart, xlm stellar, crypto bit trade, crypto, xrp ripple chart, digital coin exchange, eos cryptocurrency, cryptocoin trading, cardano coin price, what is monero, bitcoin price live, filecoin price chart, xrp rpice, digital currency exchanger, cryptocurrency 101, ada cardano price, algorand coin, xrp pric, icx token, crv token, atom coin, purchase xrp, sc cryptocurrency, crypto currency exchange, orchid crypto price, cryptocurrency types, cryptocurrency exchange usa, yearn finance price, crypto trading platforms, xlm crypto, purchase ethereum, trading crypto, chain link, bitcoin trade, doge coin price, what is tether, atom price, crypto live, chainlink crypto price, tether cryptocurrency, polka dot price, icx icon, xdg price, bitcoin price history, usdc coin, xrp price live, icon coin price, different cryptocurrency, cosmos price, crypto trade, trx tron price, bitcoin platform, augur rep price, cryptocurrency trade, gno cryptocurrency, cardano chart, what is staking coins, cryptocurrency categories, crypto exchange usa, crypto currency, ripple prive, bitcoin leverage trading, btc exchange, icx crypto, bitcoin liquidity, cryptocurrency platforms, otc bitcoin trading, monerov price, dot coin price, riplle price, dash crypto price, types of cryptocurrencies, gnosis coin, ripple price xrp, mln crypto, litecoin purchase, crypto futures, ripple chart price, cardano, bit coin trade, trade crypto, leverage trading crypto, tron prices, snx price, cosmos coin, sc coin price, lisk, siacoin rate, qtum coin, fiat to crypto exchange, price of xmr, purchase monero, us based cryptocurrency exchange, ripple coin price chart, rep price, reddit icon icx, xrp price now, price of tezos, exchange crypto, eos price chart, futures bitcoin, ada cryptocurrency price, bitcoin trading website, ethereum margin trading, bitcoin exchanger, fiat to crypto, most secure cryptocurrency exchange, what is xlm cryptocurrency, knc cryptocurrency, paxg price