Every cryptocurrencies enthusiast is familiar with the word mining. Still, it seems like mining is reserved for only serious investors who are willing and ready to indulge in this complicated machinery, just to get that famous reward. This means that they have to be ready to spend up to tens of thousands of dollars in powerful equipment, to be able to use this technology in their favor, creating new blockchains every few minutes. As a result, they are helping the process of legitimation of Bitcoin, while of course, collecting tokens.
But is Bitcoin available only to those people? Up until recently, we could say it was. Luckily, we have numerous ways to get Bitcoin and other currencies today. One of the most important elements in crypto trade, aside from interest-earning accounts, blogging, captcha solving and shopping to get tokens, are most certainly – crypto exchange platforms. Although you can earn Bitcoin and other tokens by getting paid in crypto instead of the traditional currencies for example, this is one of the few mentioned ways to get rewarded without having to invest your own money, or by investing only a few bucks. When it comes to crypto exchange, this is a place where you can trade your money for Bitcoin, and actively participate in the crypto world, even if that means that you own only a few tokens, and you’re far away from having some serious profits from it. In other words, these exchange platforms are exactly what they sound like – a convenient place for to sell or buy coins, track the changes on the market, connect with other people and finally – earn money.
How do crypto-exchange platforms actually work?
As you may already know, investing in cryptocurrencies is somewhat similar to investing in stocks. Simply put, there’s a certain level of risk involved, and there is a potentially high reward. These platforms allow buyers to connect with sellers, and the other way around. This means that if you want to invest in coins, after several verification steps, you will be able to open your account, deposit money on it, and finally – use it to buy coins of your choice. When it comes to depositing money, depending on the platform’s policy, it can be anything from bank transfers to gift cards. As long as you have the needed funds on your account, you can start trading. In case you already are an owner of Bitcoin or any other cryptocurrency, your investing and trading journey is a never-ending, rocky journey where selling and buying tokens depend on the marketplace, price changes and comparisons, economy changes and many other factors. However, whichever the case is, if you want to sell your coins, you will simply need to make a market order and do your best to get as much money you can, or in other words – the best price that is available in the system.
Are all platforms the same?
When you’re first starting to trade crypto, you will surely stumble across many exchange websites and platforms on the internet. The real question is, how to know where to start? Thanks to the rise of Bitcoin, and not only the rise in popularity, but the enormous value growth in the year behind us and the beginning of 2021, there are new exchange places on the market, and it seems like this is only the beginning of the competitive nature of this industry. However, the popularity of these platforms varies, depending on many factors in the marketplace. Some of them are well-known such as Coinbase, but some new ones show great potential in the trading space such as Gemini. What you should pay attention to when you’re first getting started? There are several extremely important things. First of all, your safety. Secondly, the security of every transaction you make and of course, the opportunity to profit from your investment. That’s why it’s so important to choose wisely, and do your research before you start trading. Still, for all the newbies, important factors to consider will certainly be the low fees and easy user interface.
How to choose wisely?
Just like every other field, this one is competitive, but generally speaking, it is a pretty secure marketplace, in which scams are present, but not so frequently as it’s the case with the traditional currencies. That is one of the reasons why crypto is becoming so popular. Cryptocurrencies are completely transparent for all of the traders in the system, they are decentralized meaning that they don’t depend on any institution or state and there is only a limited number of total Bitcoin in the system, which prevents inflation and other financial losses. All of these factors are being mentioned to help you understand how the exchange platforms work in real life.
Still, according to forexsq, it’s important to mention the differences between the currently available types of exchange on the market. The main thing you should have in mind is the difference between centralized and decentralized exchange companies. The other one would probably be, the complexity of the platforms and their rules. What’s so important about this? Blockchain technology is made to be safe. Safe both from hackers and the intruders in the system, and every other element that would be interested in interfering, such as the governmental organizations. But it still doesn’t mean there are no potential dangers to your investment.
More or less control?
Decentralized exchange companies are aligned with the very goals of Bitcoin creators. This means that there are no control elements, the system works itself and it works perfectly, without having a person, an organization or a body to run it. If one piece of the puzzle breaks down, it will not harm the whole system. Traders are anonymous meaning they don’t have to prove their identity, but their crypto activity is completely transparent to all the other participants. This can lead to some problems, such as identifying criminals or dealing with certain illegal activities.
On the other hand, centralized companies will ask for your identity, so you’ll need to leave your ID info and you’ll have to register as a member. This will provide you with more security, since you will be visible enough in case anything happens. Still, you are leaving your personal info, which may become vulnerable if you become a target of any cyber-attacks. Although they are great for beginners, still, keep in mind that your money is in someone else’s wallet.