5 things to look out for when choosing a crypto exchange

There are countless exchanges and brokers in the crypto industry. It’s easy to lose track of things. We explain what you need to look out for when choosing the right provider.

1. Stock exchange or broker – costs and what suits me better?

Cryptocurrency exchanges provide a platform for buyers and sellers who want to trade cryptocurrencies between themselves at current market prices. A large number of different cryptocurrencies are often offered. Exchanges are more suitable for active and experienced traders, since you manage and control your own trades.

Crypto brokers, on the other hand, are usually very clean and beginner-friendly. In return, the fees, i.e. the spread, are significantly higher for a crypto broker than for a crypto exchange, since the broker manages and invests the funds or crypto currencies. As a rule, the costs for brokers are between 0.75 and 1.5 percent.

A particularly interesting model that combines the best of both worlds has Bitvavo established: The simplicity of a broker combined with the significantly lower fees of a crypto exchange. Fees are based on each trader’s trading volume. This is how the exchange motivates its community to trade. The higher the trading volume, the lower the price. With a trading volume of less than 100,000 euros, the fee is 0.25 percent and becomes continuously cheaper with higher monthly volumes. Deposits via the SEPA procedure are completely free of charge and PayPal will soon be available for even faster and easier transactions

2. Trust, legal regulation and security of the platform

Money laundering, terrorist financing, shady business on the dark web. Cryptocurrencies still have to fight for their reputation. A stock exchange always appears particularly trustworthy when it has registered with the country’s central bank. Exchanges based in the EU are usually subject to stricter supervision than in other countries. For the consumer, however, this is positive. Central banks monitor compliance with the Anti-Money Laundering and Terrorist Financing Prevention Act and sanctions laws. This ensures that the cryptocurrencies are not misused. It is therefore advisable to opt for a crypto exchange with European regulation.

Regulatory developments can have a positive impact on the acceptance of cryptocurrencies. For example, she went Registration of Bitvavo at the Dutch central bank was accompanied by increasing interest from institutional customers. In addition, is Bitvavo member of a self-regulatory organization. Members of such organizations voluntarily undertake to comply with a code of conduct, on the basis of which the Best practices in the field of digital currency must be complied with. So offers Bitvavo for example, by the fact that each external wallet is once before payout by a short video verified additional protection against scamming and your own typos.

On the other hand, crypto enthusiasts are also worried about excessive intervention by the authorities. The topic of decentralization is extremely important for the industry.

3. German customer support

Despite our globalized world, there are still language barriers. Especially when it comes to complex topics such as cryptocurrencies and the technology behind them. Therefore, for our German-speaking readers, crypto exchanges with a support offer in their own native language are particularly suitable.

Checks when choosing one suitable crypto exchange always what different communication channels are offered. When support is available and how quickly it responds to requests.

Communication options such as:

• live chat
• telephone hotline
• email support
• Discord server

The support should also be available every day if possible, because the crypto markets do not sleep.

4. Which cryptocurrencies are offered?

The broader the portfolio of the respective stock exchange, the better investors can diversify their own portfolio. An old saying goes, “Never put all your eggs in one basket.” If the price of one currency falls, the price gain of another cryptocurrency can in turn compensate for the loss.

In addition to the classics such as Bitcoin, Ethereum, Cardano, Ripple and Co., the stock exchange has Bitvavo still about 170 other cryptocurrencies in the portfolio. All of these currencies can be easily bought with euros, directly via the app or the website. For each of these currencies there are charts for the analysts among us and extensive explanations of the projects behind the respective token.

Ad-hoc announcements are also displayed in the news feed, so you can keep an eye on the market via your smartphone.

5. Additional Features

Last but not least, you can check whether there are any interesting additional functions such as an app or staking options. Traders need to be able to react quickly to the market. An app makes it possible to keep an eye on prices and trade at lightning speed.

It is particularly helpful for beginners when providers provide different user interfaces, depending on the level of knowledge. Bitvavo offers a simple interface with reduced information and content so that crypto newbies are not overwhelmed. For example, the advanced user interface contains different order types, such as the market order (standard), the limit order and the stop-limit order.

Furthermore, some exchanges, such as Bitvavo, also staking on. Staking is based on the sustainable Proof-of-Stake consensus mechanism. With staking, investors can benefit from passive crypto income by depositing coins to create new blocks of the blockchain. There is then a return on the deposited coins. This return is usually much more lucrative than the returns from conventional banks.

Crypto fintech solutions from the heart of Amsterdam

Transparent communication, easy entry into the crypto world and future-oriented solutions. Bitvavo is currently the most polarizing crypto exchange in Europe and the largest provider of cryptos in the Netherlands. The young fintech company was founded in Amsterdam in 2018 and combines a classic cryptocurrency exchange with a staking service in one user-friendly app.

Bitvavo offers: Best of both worlds. The simplicity of a broker combined with the significantly lower fees of a crypto exchange.