Where you can change your bitcoin for other coins
Where you can change your bitcoin for other coins
Cryptocurrency exchanges allow you to exchange between cryptocurrencies. Some exchanges only allow you to exchange cryptocurrency to cryptocurrency, whilst others will let you exchange fiat (normal money) to cryptocurrency and vice-versa. Most exchanges do not need identification at present unless you are planning on withdrawing large amounts of cryptocurrency per day.
Understanding the key concepts behind using exchanges
Lets go through a few key concepts which apply to all exchanges and how to use them:
1) Once your account is setup ensure to activate 2 factor authentication (2FA) using google authenticator or equivalent. This offers a significant layer of protection should your computer be compromised. Make sure you write down the secret google authenticator code you received when setting this up somewhere offline and safe (in case your phone be lost or broken.
2) On each exchange you will have a Bitcoin wallet (BTC). This will have its own Bitcoin wallet address. Send the Bitcoin you have just bought / already have to this address. Make sure the address is entered correctly including capital letters and make sure it is your Bitcoin wallet (BTC) and not bitcoin cash (BCH/BCC etc) or your funds will be lost. It will take some time for the bitcoin to appear in your wallet (sometimes several hours depending on the Bitcoin network congestion)
3) Once the Bitcoin arrives your Bitcoin wallet on the exchange you can trade them for the other cryptocurrencies. Simply look up the BTC/alternate cryptocurrency section and select the cryptocurrency you would like to buy. Whilst each exchange is different you will typically see a chart showing the current price and you will have 2 columns. One that is a bid (buy) column and one that is a ask (sell) column. The bid price represents the price people want to buy for in fractions of Bitcoin whilst the ask column will represent the price people want to sell for. There is usually a small difference between the two (between 0.1% and sometimes up to 5%). This is known as the spread and the smaller the spread the better the price you will get when buying.
4) Since we want to buy you have 2 choices. (1) enter a bid of how much you want to pay for each coin and the quantity of coins you would like. The site will show you the total amount of Bitcoins this will cost you. Hit enter and your bid will appear in the column of bids. If you don’t want to wait too long entering a bid that is a tiny increment above the current top bid will put yours at the top of the bid list. However when the price is rising it is likely that your bid will not be successful and will be left in the book of unfilled orders waiting for the price to drop. (2) if you want to instantly change your Bitcoin for the other coin you can simply buy the coins at the current ask price by entering a bid at that amount. You will pay a higher price but it means you guarantee that your order will be filled providing there are enough coins at that ask price.
5) Once you have your coins we advise moving them OUT of the exchange to your own wallet. The final section “protecting your cryptocurrency” will explain to you what to do so once you have the coins.
Top cryptocurrency exchanges
It is important to use exchanges that are safe and also offer a good selection of cryptocurrencies. We have made the process easy by reviewing the top exchanges below based on ease of use, speed of transactions, reputation, fees, payment methods and number of available cryptocurrencies. If you make an account on each you should have access to most cryptocurrencies. Should you wish to get cryptocurrencies not available on the exchanges below ensure to research the exchange prior to doing this as there are scam exchanges that will seek to part you with your money.
Bittrex has been around since 2014 and has gained considerable reputation among its clients. To use Bittrex you will need to buy bitcoin first (see buying Bitcoin section if you need help how to do so) and then transfer it into your Bittrex Bitcoin wallet. From there you can trade your bitcoin for one of over 190 different cryptocurrencies. The platform is lightning fast and the fees are transparent and reasonable. The platform is intuitive and it takes little time to get used to it. Overall we recommend Bittrex but we strongly recommend that all funds transacted are moved immediately to a hardware wallet where you control the keys for security of your funds.
Kraken is one of the oldest exchanges founded in 2011. It enables you to deposit fiat funds if necessary directly (USD/YEN/EURO/GBP). It has a very limited selection of coins however it offers state of the art security and has been present for a long time and never been hacked. It offers very competitive fees and is very slick and easy to use. We recommend it highly to all for purchasing the top tier coins.
Binance was launched in July 2017 and has grown exponentially, consistently being in the top 5 exchanges by trading volume. To use Binance you will need to buy Bitcoin first (see buying bitcoin section if you need help how to do so) and then transfer it into your Binance Bitcoin wallet. From there you can trade your Bitcoin for one of over 80 different cryptocurrencies. The platform is lightning fast and the fees are some of the lowest of any exchange. The platform is not the most user friendly however so there will be a learning curve. Overall, we recommend Binance but we strongly recommend that all funds transacted are moved immediately to a hardware wallet to ensure the security of your funds.
Kucoin only recently launched in September 2017. Its growth has been even more exponential than Binance and they are becoming the place where new coins are being listed before other major exchanges. They often offer promotions when a new coin is released which is driving traffic significantly. Furthermore Kucoin shares (KCS) can be bought on their platform that offers holders 50% of the exchanges profits. To use Kucoin you will need to buy Bitcoin first (see buying Bitcoin section if you need help how to do so) and then transfer it into your Kucoin Bitcoin wallet. From there you can trade your Bitcoin for one of over 80 different cryptocurrencies. The platform is lightning fast and the fees are some of the lowest of any exchange. The platform is very intuitive and one of the most visually pleasing we have seen. Overall we recommend KuCoin but strongly recommend that once the transaction is done you move your funds to a hardware wallet to ensure the security of your funds.
Changelly is different to the other exchanges in that it lets you trade one cryptocurrency for another directly with them. The price changes dynamically and they aim to offer the best rate at a given time. For cryptocurrency to cryptocurrency they offer they take a 0.5% fee which is slightly higher than exchanges but it enables direct conversion from one of 35+ cryptocurrencies to another and automatically sends the funds to your wallet rather than remaining on the exchange. The fee is extortionate however if you want to convert USD for cryptocurrency at around 30% so this is not recommended. The website is very intuitive and easy to use. Be aware that you will need to pay the network transfer fee for the currency you send as well as the network fee for them to send you the cryptocurrency you have exchanged for. Overall its a good way to swap cryptocurrencies without having to use an exchange.
Bifinex is one of the largest exchanges in the world by volume. They have been plagued by 2 hacks in the past with the hack in 2016 being the 2nd largest ever (120,000 BTC were lost), however they issued tokens to their clients and have now redeemed all of them so all clients have been reimbursed for full. The USA have now banned all users to use Bitfinex but it can be used in all other countries and it offers excellent fees as well as liquidity for all cryptocurrency pairs. They also offer the option to buy cryptocurrency for fiat. The platform is not the most user friendly however no one else beats it for liquidity and excellent spreads between pairs. As always we recommend you move your cryptocurrency immediately once you have traded to a hardware wallet where you control the keys and the previous hacks make the importance of this even more evident as next time they may not pay out. Update: In December 2017 there was a Subpoena from the USA Government and they are under investigation. We suggest that you do not use or if you must use with caution until more information is available and if you use you immediately withdraw anything you trade to your own private wallet.
Cex.io was founded in 2013 and initially offered cloud mining along side its exchange. In 2015 they closed their Bitcoin mining operations and dedicated their focus to their cryptocurrency exchange. Whilst there was a hack early on in its infancy there has been no compromises since and it offers the same high security as the rest of the recommended exchanges. The ID verification to create an account is very thorough and more lengthy than any of the other exchanges and their fees are comparable to other exchanges although there is a premium of 7% when buying or selling Bitcoin, which does make it more expensive than the other exchanges. It also has fewer coins than the rest with just a handful of coins for trade. However it remains a useful platform to buy Bitcoin and a few of the other major cryptocurrencies.