Choosing the best cryptocurrency exchange – your options and how to choose between them


  • A crypto exchange plays a vital role in the cryptocurrency world, converting everyday money into digital coins and vice versa.
  • More and more investors in India are embarking on growing their wealth, hedging against inflation and diversifying their investments.
  • Here’s how a newbie investor or seasoned trader tired of the exchange they are currently using can choose the best crypto exchange that meets their specific needs.

Indian cryptocurrency investors currently have more than ten open exchanges – and more are on the way to enter the country. Nearly two million Indians currently hold a cryptocurrency, with a single exchange accounting for $ 21.8 billion in transaction volume in the first seven months of this year.

For a person who trades cryptocurrencies, the exchange they use makes a big difference in the results. “But wait,” you say, “Cryptocurrency is decentralized and can be moved directly peer-to-peer (P2P), right? That’s right, yet more than half of Bitcoin’s transactions over the past two years have been done through an exchange.

Here’s a look at what an exchange does, how it facilitates trading, what services are different from each other, and more.

Exchanges Seek To Do More Than Just Trade Bitcoin For Rupees

An exchange plays a key role in enabling the trading and use of cryptocurrency. Simply put, it serves as the entry point for “normal” money such as rupees to enter when buying crypto, and the exit point for exchanging rupees when selling crypto. Essentially, it serves as a matchmaker to connect those who want to buy with those who want to sell. On a sufficient scale, an exchange could have a sufficiently large “backlog” to offer “currency pairs” that help users who wish to directly convert one unit of crypto to another, such as from Bitcoin to Ethereum.

Since exchanges earn from transactions made, they recently promoted wider adoption of cryptocurrency, introducing users to crypto lending, crypto borrowing, and NFT art auctions. In addition to economic functions, law enforcement relies on identity verification that exchanges are mandated to perform, to investigate any probable crime.

Theoretically, anyone could set up a crypto exchange with readily available software modules. However, in practice, only registered verifiable businesses are able to accept Indian users and payment methods. This is due to the need for recognition of payment gateways to receive / send money, interfacing with government credentials to verify users with PAN / Aadhaar cards, and tax audit requirements thereby reducing the risk of illegal operators.

Largest Usable Cryptocurrency Exchanges In India

Here are 16 of the biggest crypto exchanges accessible in India:

To exchange 24h volume in US $
Binance 35.04 billion
OKEx 9.78 billion
Coinbase 7.43 billion
Kraken 1.47 billion
Bitfinex 1.04 billion
Bitstamp 432 million
WazirX 275 million
CoinDCX 112 million
Zebpay 36 million
Bitbns 35.5 million
Giottus 18.7 million
Unocoin 192,000
CoinSwitch Kuber N / A
Vaud N / A
Buy UCoin N / A
Coinmama N / A

Source: CoinMarketCap
Note: Transaction volume is variable, this list is ordered by 24-hour transaction volume in US dollars, as of the close of November 1, 2021.

We don’t rank them because different people’s preferences would place different weights when measuring them against each other. For example, a person might prefer a much smaller exchange, designed to be easy and well-supported, compared to a global giant. We can use a few before deciding which one they prefer. Yet another can focus on fees and margins. We detail these subjective factors below for your benefit.

Things to watch out for when choosing a crypto exchange

Let’s put one thing out of the way – for a long-term investor starting to test the waters with cryptocurrency, any exchange will do just fine. The important thing is to save money and gain confidence.

After a certain point, however, a lot of the little things become important. When you invest larger sums or seek short-term transactions for profit, these “quality of life” improvements contribute to speed, convenience, cost and risk reduction. These nine factors are explained below, with various exchanges reconciling them to varying degrees.

  1. What is KYC on crypto exchanges?
    Global “know your customer” laws make it mandatory to upload proof of identity of your name and address before you can do anything. Vauld is an example of an Indian exchange that accommodates central government issued IDs and uses automated systems to overcome this hurdle in seconds. Binance, on the other hand, has had wait times of several weeks to complete KYC, according to some users.
  2. Payment methods and currency accepted on crypto exchanges
    Since Indian banking authorities still haven’t explicitly welcomed crypto, pouring money into your exchange is still not as easy as booking a train. WazirX, for example, currently prefers UPI transactions which are relatively fast. In the past, the Reserve Bank of India (RBI) had blocked the transfer of money to crypto exchanges. Although this issue was resolved in September, India’s largest bank (SBI) is still trying to prevent even UPI transfers from its account holders to exchanges. This partly explains why Indians sometimes take a possibly illegal route to register / verify as a non-Indian on international exchanges, so they can use debit / credit cards to add money to their currency wallet. .
  3. Why is the selection of coins or cryptocurrencies important when choosing a crypto exchange?
    A wide selection of coins and currency pairs maximizes the chances of profit. As a dreadful example, Paypal only sells four major coins in two countries at a steep price, which may make sense to loyal users. At the other end of the spectrum is Coinbase, which supports hundreds of coins and thousands of coin buy-sell combinations called currency pairs, like Ethereum-Bitcoin, Shiba Inu-Tether, and Solana-Bitcoin. Such currency pairs allow direct trades between themselves, instead of needing two trades to separately sell one coin and then buy the other.
  4. Fees on crypto exchanges
    Transaction fees are the profitable part of an exchange, but are perilous for a trader with low profit margins. Exchanges take fees on everything from deposit to withdrawal, instant selling and buying to futures trading, and portfolio transfers to lending / borrowing. They can charge a flat fee or a percentage, with rates varying with different user levels and subject to change over time, making any comparison outright at worst unnecessary or difficult at best.
  5. Financial services offered by crypto exchanges
    Because the basic facilities of an exchange are commoditized, the best go further. If simple trading isn’t exciting enough, welcome to the world of derivatives such as leverage, short sales, loans, and NFT art sales. On such a scale, Paypal would occupy the extreme end of the trouble, and Binance at the other end with financial derivatives deemed too extreme for European regulators.
  6. Features and Benefits of Mobile Application to Have Crypto Exchange on the Go
    On the go, an easy-to-use smartphone app is ideal for investors who don’t always have access to a larger screen with space for plenty of detailed charts. For example, the CoinDCX app achieves a certain trade-off between convenience and complexity, while Vauld sacrifices nuance to come closer to convenience.
  7. Speed ​​of execution of exchanges at the critical moment on different crypto exchanges
    The speed of transaction execution, even after allowing for delays in crypto transactions, has been a sore point with all of the exchanges currently serving India. Tragically for savvy investors, when there is a flurry of activity in the market and great opportunities open up, the bigger exchanges slow down and the smaller ones simply collapse (shutdown for maintenance) due to surprisingly high traffic. Also in times of extreme volatility, users have noticed that they cannot sell but are still allowed to buy, which the exchanges say is a way to “protect” their users.
  8. The importance of security of digital currency and user data on crypto exchanges
    All major Indian exchanges are centralized with user portfolios managed by the exchange. In general, a larger and growing stock exchange is more likely to see the need for and fund a security team, compared to smaller ones. So far, no Indian crypto exchange has revealed any security holes. To reduce risk, long-term investors typically move their crypto holdings from one exchange to a separate wallet over which the investor can have more control.
  9. User support on crypto exchanges
    You may have questions or issues even after going through the tutorials and help section for the relevant exchange. The options usually offered are then to send an email or a live chat to get a response from the company, or to post on their forums to discuss it with other users. The most important exchanges are also able to maintain a presence on social networks, on sites such as Twitter and Reddit.

India is said to have strong cryptocurrency adoption, being ranked second out of 154 countries in June 2021 by Chainalysis, a blockchain data platform. In a premium report, it notes that the value of the Indian digital currency market has grown from $ 923 million in April 2020 to $ 6.6 billion in May 2021. More recently, self-regulated cryptocurrency brands have made the leap. aggressively advertised at the T20 World Cup this year. . Given the efforts to broaden awareness, now is the time for a wealth-building cryptocurrency trader to evaluate their crypto exchange for maximum benefit.

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