Best Crypto Trading Platforms: The Definitive Guide [2020]
Global cryptocurrency markets are bursting at the seams with new traders looking to profit from the renewed growth in cryptocurrency prices since the end of 2019.
But this trend started after 2017’s epic bull run captured the attention of seasoned traders and the general population as a whole, with a flurry of new cryptocurrency trading platforms springing up to satisfy increased trade volumes and a wave of new users entering the market.
As the cryptocurrency industry has grown, it’s become even harder for traders to be able to separate the best trading platforms from the worst. This requires time and resources in order to objectively break down the pros and cons of each platform.
So we’ve taken the time to do just that, providing a deeper insight into the best crypto trading platforms of 2020, starting with a brief history of crypto trading platforms, moving on to the difference between cryptocurrency exchanges and brokerages, before looking at how to select a good trading platform, and finally finishing with a list of the best crypto trading platforms in 2020.
What are Crypto Trading Platforms?
The History of Crypto Trading Platforms
Initially after the creation of the first cryptocurrency, Bitcoin, there were no central places available to trade this new financial asset.
Those that knew about Bitcoin and owned some of it were in a tightly-knit and small group of cryptographers, financial anarchists and tech hobbyists that had decided to buy into Bitcoin or to begin mining it.
This changed when the community began to grow to a size where launching a crypto trading platform would be economically viable, and a few small exchanges were created around the time of 2010 and 2011.
Out of all of the first crypto trading platforms, Mt. Gox became the most well-known and widely used, and at one point in time more than 70% of the world’s Bitcoin trades took place on this platform.
Mt. Gox collapsed in spectacular fashion in early 2014, when the management of the platform realised that they had been hacked, and that all of the Bitcoins they held had been stolen. The total value of that hack in 2014 was $473 million.
After the Mt. Gox hack, the platform promptly collapsed, sending a shockwave throughout the newly formed cryptocurrency industry.
A number of platforms sprung up in its place, taking significant amounts of market share that was now freed up. Platforms that were formed during this era that are still functional today include Bitstamp, Kraken, Coinbase and Bitfinex.
Today cryptocurrency trading platforms are globally-dispersed in every continent of the world, with some places now becoming natural magnets for crypto projects, including exchanges and brokerages.
Which Countries have the Most Crypto Trading Platforms?
According to a study completed by Crystal Blockchain last year, there are 63 locations globally that cryptocurrency exchanges are based in, and that Europe, Asia and North America host the vast majority of crypto trading platforms globally.
Of the 63, the top 10 locations are the UK with 43 exchanges, unknown locations with 33, the USA with 27, Hong Kong with 22, Singapore with 19, Australia with 9, China with 9 , Estonia with 8, Brazil with 7, and South Korea with 7.
Interestingly and somewhat predictably, 33 exchanges have unknown locations and while this is uncommon for traditional asset trading platforms, the anonymity within the cryptocurrency industry has been a foundational part of it since Bitcoin was created.
The Middle East, South America and Africa are significantly underrepresented, with most of Africa having some of the weakest economies in the world and the Middle Eastern bloc largely banning cryptocurrency.
Of all of the G20 nations, the EU, UK and USA combined represent 46% of all cryptocurrency exchanges globally, with this typically being mirrored in the stats for the usage of cryptocurrencies as well as the representation of countries as crypto exchanges.
What is the Difference Between Crypto Exchanges and Crypto Brokerages?
What are Crypto Brokerages?
Cryptocurrency brokerages are trading platforms that facilitate trades between traders and the platform itself, or between traders and a small select group of liquidity providers.
While cryptocurrency exchanges were the original type of crypto trading platform, cryptocurrency brokerages are a newer incarnation that have brought a range of new types of trading into popularity within the crypto industry.
An example of this is margin trading, which initially was almost unheard of in the cryptocurrency market, and today with the introduction of many crypto brokerages margin trading has become very popular and widely used.
Cryptocurrency brokerages are typically newer platforms, that have advanced features and services, as well as improved security and performance.
This is because brokerages don’t have to create connections between thousands of traders concurrently, but only directly between each trader and the platform.
As well as increasing performance, this can also reduce the potential attack vectors available to hackers, and this is reflected in the fact that cryptocurrency exchanges are significantly more likely to be hacked than brokerages statistically.
What are Crypto Exchanges?
Cryptocurrency exchanges are cryptocurrency trading platforms that facilitate the trade of cryptocurrencies between traders, with the platform itself only acting as a mediary.
Cryptocurrency exchanges are the original type of cryptocurrency trading platform and are typically older, both in age and technology.
While cryptocurrency exchanges have modernised as the industry has, the dramatic push from traders towards brokerages over the past few years shows that the services provided by exchanges could do with improvement.
Cryptocurrency exchanges typically have reduced performance and security compared to brokerages, and have been hacked much more often than them also.
By having a large number of concurrent connections being required at all times, exchanges have more pressure put on their systems and this can lead to trading glitches and delays.
Even the largest cryptocurrency exchanges have suffered hacks, with Binance being hacked in early 2019 for a total of over $40 million in traders’ funds.
How to Select a Good Crypto Trading Platform?
Low Fees
One of the most important considerations for traders when selecting a cryptocurrency trading platform to use is what the cost of making trades will be.
There is a very wide range between the cheapest cryptocurrency exchanges and the most expensive, and with developing profitable trading strategies essentially being a calculation that is the profit from each trade minus the trading fee, having a larger or small amount to pay can have a huge impact on overall profitability.
When assessing trading fees, the range of around 0.04–0.075% is considered low, with anything above this considered to be high in the cryptocurrency industry today.
This is extremely telling considering that some of the major crypto exchanges such as Coinbase and Binance have fees that are significantly higher than 0.075%.
A priority for any trader when selecting a place to trade should be that it has the lowest fee schedule possible, and some of the platforms in our list below have the lowest fees we’ve seen anywhere in the crypto industry.
Wide Variety
In trading, opportunity can come from variety, with having 10 different assets to trade being 10 times more likely that there is one that can be profitably traded than having just 1 asset to trade.
There are some platforms that specialise in only a few different types of assets and instruments and these niche providers can often provide unique opportunities that cannot be found elsewhere.
But outside of this, any exchange that has a large list of assets to trade is typically going to provide more opportunities for profitable strategies to be developed.
Also, as well as just the number of assets being listed, the variety in the types of assets is also important. For example, a platform that lists stocks and cryptocurrencies will likely have more opportunities present than just a cryptocurrency trading platform without stocks.
Traders should place greater value in platforms that provide more assets in their listings, and provide a greater range of variety there also.
Good Security
Unlike traditional markets, the cryptocurrency market is fraught with scammers and online criminals that are constantly working to hack platforms and steal from their customers.
For this reason, the level of security and past track record of a cryptocurrency trading platform is critical in understanding how desirable it is to trade there.
There are many cases of large trading platforms being hacked and tens of millions being lost, and while this can technically happen to almost any exchange, it is wise to look for those platforms that have dedicated time and resources to creating well fortified places to trade.
Look for advanced security features as a good indicator of how secure a platform is, as well as checking online for any accounts of the platform stealing from customers, or the platform itself being hacked and losing money.
If the platform has a clean track record and has been around for a while, that’s a great indicator that they’re worth considering — otherwise, steer clear.
Many Payment Options
It’s important that traders have as many ways to deposit funds into their account and make withdrawals as possible, as this allows for flexibility with the way that users can interact with cryptocurrency markets.
Being able to take Bitcoin payments is critically important, as Bitcoin is the most commonly used cryptocurrency today.
As well as this, being able to take payments using credit cards is a big bonus, as well as by using other cryptocurrencies which can then be converted into whichever cryptoasset is desired to be traded.
Using a platform that at the minimum has the kind of payment method which you need is important, but even better, one that has a wide array of methods that will mean that no matter which way you’d like to top up your account you can do so.
High Leverage
Today margin trading has taken over as being the most common way that cryptocurrency traders create positions, with huge volumes of margin traded cryptocurrency passing through global markets each day.
Having access to cryptocurrency margin trading is a plus, but more than this, having access to high leverages is important considering that much of the market only provides low leverages at around 2x — 3x.
Having leverage of above 50x is quite rare, and allows a wider range of traders to be able to trade at the levels that they would like.
As the trend towards crypto margin trading increases, there are more advanced platforms that provide high leverages and these platforms should be considered as better than their lower margin counterparts.
What are the Best Crypto Trading Platforms in 2020?
PrimeXBT
PrimeXBT is the world’s leading multi-asset margin trading platform, and throughout the past few years this platform has grown their user base substantially, as well as their trade volume as a result of this.
Today PrimeXBT handles up to $950 million per day in trade, as well as being one of the major bridges between the worlds of cryptocurrency and traditional trading.
The platform’s listings include a wide range of cryptoassets such as BTC, ETH, LTC, EOS and XRP, as well as traditional assets including stock indices, forex pairs, and commodities.
Recently PrimeXBT has announced that 19 of the world’s leading financial instruments are being added to their listings, including forex pairs like NZD/CAD, NZD/CHF, NZD/JPY, NZD/SGD, NZD/USD, AUD/NZD, EUR/NZD, USD/SGD, EUR/SGD, GBP/SGD, USD/TRY, USD/RUB, CAD/CHF, CAD/JPY, and CHF/JPY, and leading stock indices such as the Europe 50, France 40, Spain 35, and the Wall Street 30.
PrimeXBT has the lowest fees that we’ve found in the industry, with a flat fee of just 0.05% being applied to all trades, as well as fast, KYC-free registration without the need for anything other than an email.
Coinbase
Coinbase is one of the older crypto markets still operating today, and over the years they’ve taken a direction more focused on institutional investors than the retail market.
Coinbase’s comparatively high fees have played a part in this, with a fee schedule that was already more expensive than other platforms being revamped with even higher fees when Coinbase’s exchange, GDax, was rebranded to Coinbase Pro.
Saying this, Coinbase provides solid tools for traders to use, and the interface of the platform is intuitive, with many features that traders would like to see.
Also Coinbase has been one of the major onramps for fiat credit card funds to flow into the cryptocurrency market with a significant amount of total transactions via this means coming through the platform.
Overall PrimeXBT is an expensive platform, but one that provides good services.
Binance
Binance is one of the newer platforms on the market today, having been launched in 2017 with their base originally in Hong Kong, and then relocating recently to the blockchain-friendly island of Malta.
Binance has managed to drum up a good amount of support in a relatively short period of time, using a combination of ubiquitous social media presence and their native token, BNB, in order to spread the world about their project.
Binance provides a clean interface that is easy to navigate, as well as tools such as credit card payments, a decentralized exchange on the way, and the ability to reduce fees using BNB.
Unfortunately, Binance’s fees are already up to 10x higher than competitors like PrimeXBT so the reduction in fees using BNB still leaves traders paying substantially more.
As well as this Binance’s security was called into question following a hack in early 2019 that saw $40 million of users’ funds stolen.
Saying thit, Binance is not a bad platform to check out, and has some interesting benefits by trading there.
What is the Future of Crypto Trading Platforms?
The cryptocurrency industry has come a very long way since its start over a decade ago, with cryptocurrency trading platforms now being significantly advanced compared to those that were launched back then.
As well as this, the market has grown. Today there are hundreds of cryptocurrency trading platforms, and these patterns are likely to continue into the future.
Only a small fraction of the world’s population are engaged in cryptocurrency trading, and cryptocurrency as a technology, a tool for general use, and as a phenomenon is only just starting to make any serious steps into the mainstream.
As that continues, and as more of the world begins to buy and sell cryptocurrencies, we can expect to see the size of the cryptocurrency market and the number of cryptocurrency trading platforms increasing exponentially.
Today there are many parts of the world that have little or no cryptocurrency trading platforms based there, and as these populations become more aware of cryptocurrency and more technologically capable, we can expect to see an influx of new platforms launching in Africa, the Middle East, and South America.
And, as much as there will be growth in the third world, we can also expect to see developed countries remaining the global hubs of cryptocurrency trading — with their exceptionally safe regulatory environments and access to wealthy local markets fuelling growth for decades to come.
In Conclusion: Best Crypto Trading Platforms
As the cryptocurrency industry grows in size and the number of traders entering the market, it becomes even more important to use due diligence in the process of selecting cryptocurrency trading platforms to use.
While there are some crypto trading platforms that are low quality, with a good amount of research the best platforms in the industry can be identified — based upon factors like low fees, high variety, high security, lots of payment options and high leverage levels.
All of the 4 platforms we’ve listed have one or more of these factors, with the top platforms performing well in all of these areas.
The long term impact of selecting high-quality cryptocurrency trading platforms cannot be underestimated.
