Where To Trade Bitcoin – The Trading Exchanges
If you want to trade bitcoin and try to make profits on it’s volatility then you need a reputable exchange. The exchanges differ from buying services as they cater more towards the investor and trader rather than the person who wants to buy and spend bitcoin.
USD$ deposits and withdrawals.
USA Licensed and Regulated
First crypto exchange to charter a US bank.
Total: 3 Average: 4.7
|Visit Kraken Read Review|
Licensed by New York State Department of Financial Services
Fiat to Crypto and Crypto to Fiat
Regulated, Licensed and Trustworthy
Total: 1 Average: 5
|Visit Gemini Read Review|
Worlds largest by volume crypto exchange
Virtually ever alt coin available to trade
Total: 22 Average: 3.1
|Visit Binance Read Review|
Bank Transfer / SEPA
Quick, Easy way to buy or sell.
Margin Trading (no USA)
Guaranteed Stop Loss Orders
Total: 28 Average: 2.7
|Visit CEX Read Review|
Bitcoin Derivatives Trading Platform
Up to 100x Leverage
Trading platform for professional traders.
Total: 34 Average: 2.8
|Visit Bitmex Read Review|
The Basics of Trading Bitcoin
There are differences between the trading sites listed here than the bitcoin brokers that sell bitcoin themselves.
First, you will get better exchange rates by buying bitcoin from an exchange. Compare prices at a broker where you can only buy bitcoin and you will see that the trading platforms offer a better exchange rate.
What is an exchange? This guide on investopedia covers how they work in general. The crypto exchanges work the same way. They are essentially a marketplace where buyers and sellers come together and trade. In this case, you are buying, selling and trading bitcoin, fiat currencies and other crypto’s.
There are two main types of bitcoin trading platforms.
- Fiat Exchanges ($USD, €EUR and others)
- Crypto Exchange Only (BTC, ETH, XRP and other crypto coins)
Fiat Exchanges (Normal Currency Like $ USD or € Euro)
Most new traders are going to need a fiat exchange. A place where you can buy bitcoin with regular money and eventually sell bitcoin for fiat currency. These types of exchanges are required to register as ‘money exchanges’ and must follow KYC rules (know your customer) which vary by location.
Who are the best bitcoin exchanges you can deposit and withdraw fiat?
Tips to stay safe when dealing with fiat exchanges.
First, go with a fully licensed and regulated exchange for your area. There are USA bitcoin exchanges, Canadian, Mexico, Europe, China, India and plenty of UK licensed exchanges.
If you have bitcoin and want to trade it for a different crypto currency then you are open to more trading choices. Crypto only exchanges are not required to be licensed and regulated at the same level as fiat exchanges. You have more choices.
Who are the best crypto only exchanges?
- Binance – the worldwide largest volume crypto exchange out there with a huge number of alt-coins.
- WhaleClub – surprisingly quality crypto only exchange that does not require ID.
- Poloniex – the largest altcoin exchange out there.
- Bittrex – a major competitor to Poloniex and where many migrated after customer service issues overwhelmed poloniex in July 2017
The crypto to crypto exchanges I like to call the “exchange asylum”.
It is nuts out there. It feels like the financial wild west.
The alt-currency exchanges unregulated mostly. They are numerous. Hundreds have opened up.
Most should be avoided. I do not trust them. The scams and problems are numerous and plenty. Even today in the second half of 2017 bitcoin buyers and sellers need to seriously do their due diligence when picking a place to buy and sell.
If you have looked at the crypto currency exchanges you might appreciate the fact that it is literally an ‘exchange asylum’ out there. It is crazy. There are over 800 cryptocurrencies, coins or tokens on the markets now and dozens upon dozens of exchanges popping up left and right to sell these digital tokens.
The Business of Bitcoin Exchanges
Bitcoin exchanges are big business.
Millions of dollars worth of bitcoins are bought, sold and traded every day. One of the largest US based exchanges, Coinbase had 40,000 new users sign up in one day.
— Brian Armstrong (@brian_armstrong) May 26, 2017
The important thing you need to know is that you are trading with a reputable, honest and trustworthy exchange. If you are not dealing with a fair trading platform then it does not matter how good of a trader you are. If they are a scam site then you will never get your bitcoin back.
How To Trade Bitcoin – Multiple Ways of Trading BTC
All of the exchanges allow you to buy and sell bitcoin. Some offer more advanced trading features as well.
- Buy / Sell
- Margin Trading / Leverage
- Futures / Derivatives
- Mutual Funds
This site does not focus on bitcoin trading strategies. There are plenty of professional day traders out there as well as bitcoin trading software that you can use to try and profit from the volatility of crypto’s.
However, we will cover the bare basics with a quick explanation of what each of the different trading options you have.
Buy / Sell
Simply buying or selling bitcoin at the market rate of the exchange you are trading at. At exchanges with high liquidity the prices should all be pretty similar to one another. BitcoinAverage looks at the price at all the major exchanges to see if there are any major differences. At the very least it should give you a quick confirmation of the prices you can find.
All of the exchanges we list offer buy and sell services.
Like traditional investing, trading bitcoin on margin is when you borrow money to leverage your position and increase your buying power. You are in a live market with real bitcoins or fiat.
Using leverage increases your buying power and increases your risk. Some of these exchanges also allow you to earn interest on your BTC by lending it out to others on their exchange to use in margin trading.
Futures / Derivatives
Futures trading is a derivatives contract. It represents the price of bitcoin at a point in the future. When trading bitcoin futures you are not actually trading real bitcoin. Instead you are trading a contract that is going to be settled at a specific time for either a profit or a loss.
Futures are extremely volatile, high risk, high leverage options.
- BitMex.com – daily, weekly, quarterly and 6 month futures contracts.
- OKCoin – get 20x bitcoin leverage trading bitcoin derivatives.
You can trade Bitcoin CFD’s as well, or contracts for difference.
A CFD is essentially an agreement between two parties to pay one another a pre-agreed rate of the change of price of the underlying asset. In this instance it is bitcoin. Here are the recommended exchanges that offer CFD trading:
Bitcoin options trading is another way to attempt to profit from the movement in the crypto markets.
Here are the best bitcoin option trading sites:
- Crypto Facilities
You can even buy bitcoin and cryptos in a mutual fund. At the time of original publication of this page, Fidelity was making progress towards offering a bitcoin investment mutual fund that you could buy.
Trading Bitcoin On The Bitcoin Exchanges
This is the wild west of bitcoin trading.
There have been many scams. There has been a lot of theft and loss of bitcoin over the years. It is still happening today. It is important to use real reviews and earned reputation to help guide you towards the legit bitcoin trading sites.
Here are a few quick tips:
- Understand the risk of every investment you make.
- Do not store your coins on the exchanges wallet. Send them to a wallet where you control the private keys
- Do not invest more than you can afford to lose.
- Bitcoin and crypto’s are extremely volatile. You should consider this an ultra high-risk investment.
- Keep up to date with the best bitcoin exchange list featured on our homepage for always updated toplists
Here is my short list of legit bitcoin trading platforms/exchanges.
- Cex.io – Worldwide bitcoin exchange – Buy, sell and trade BTC and ETH at this UK based, fully FinCEN licensed exchange. Very competitive rates, high liquidity and positive historical reputation make this exchange one of our highest rated.
- Whaleclub – Anonymous crypto only trading platform with a very nice bonus you can earn via trading.
- Kraken.com – This USA based exchange offers high liquidity for BTC>USD trades and offers bankwire of USD as payout options for most states in the USA.
- Bitmex.com – No USA users. Trade BTC for Yuan, Yen and other currencies.
- Poloniex – This is the land of Crypto to Crypto exchanges. Here you can trade 50+ Altcoins and is one of the few places to trade some of the lesser known crypto’s. These are almost like the penny stock market. Extremely risky investments but they are about the only place to buy and trade many of the new coins.
- Gemini – large regulated exchange for European and Asian traders.
- GDAX – This is the exchange set up by CoinBase. You can trade BTC/USD, Ethereum and Litcoin. They are a USA based regulated exchange out of San Francisco. The liquidity is good and company behind them seems established and successful.