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Bitcoin (BTC) is the most traded crypto. However, different exchanges how differing transaction fees, security measures, and ease of trading Bitcoin. Below, we look at how to trade on five leading digital currency exchanges.
Best crypto exchanges to trade Bitcoin
How to trade Bitcoin on Binance
Born in 2017 and founded by Changpeng Zhao, Binance has risen to become the leading exchange for spot trading. To trade, a user needs first to create an account.
Creating an account
Unfortunately, not everyone is welcome on Binance. Trading Bitcoin is not available to anyone from countries sanctioned by the United Nations, or the Office of Foreign Assets Control of the US Treasury Department, or who’s less than 18 years.
If you don’t fit in any of these categories, visit www.Binance.com and click “Register,” enter an email address, password, and a referral ID in case you have it, and hit “Register.”
Funding the account
To get down to business, funds have to be deposited to enable a trader to either sell or buy in BTC. Funds can be deposited either through a Visa/MasterCard or another crypto wallet.
To purchase Bitcoin directly using a credit card, click on “Funds>Buy with Credit Card.” Funding from another wallet follows a different route. First, get hold of the Bitcoin deposit address on Binance by accessing “Funds>Balances” and selecting Bitcoin then “Deposit.” Now, head to the other wallet, select Bitcoin, and choose “Withdraw/send.” Enter the deposit address and hit “Withdraw/Send.”
The trading option is available on the account homepage. Select the right trading market. For example, to exchange Bitcoins for Tether (USDT). Click on BTC markets and select the USDT/BTC market. Clicking on this trading pair leads to the trading pane.
Select the amount of USDT to buy and the percentage of BTC to use, click “Buy ETH.” If it’s a market order, it’s executed immediately, while a limit order may take longer.
Withdrawing Bitcoin from Binance
The process of withdrawing BTC from Binance is similar to the depositing Bitcoin from another wallet but in the reverse order. First, get the deposit address from the other wallet. Then on the Binance landing page, click on “Funds>Balances.” Select Bitcoin then click on “Withdraw.” Enter the deposit address and click on “Withdraw.”
Is Binance secure?
Yes. To boost security, Binance requires that traders activate the two-factor authentication method either through SMS, email, Google Authenticator, or a hardware security key.
Advantages and Disadvantages of using Binance
- Low transaction fees.
- A large number of listed and tradeable coins.
- High trading volume.
- Has a mobile app for trading on the go.
- It’s secure
- Using Binance Coin attracts lower trading fees.
- Its basic interface is not so basic for new users.
- It’s unregulated
- Unpopular altcoins have low liquidity.
How to trade Bitcoin on Bitfinex
A bit older than Binance, Bitfinex has been in the cryptocurrency exchange market since 2012. Unlike Binance that’s known for spot trading, Bitfinex has a curved its path along leverage trading.
Creating an account
The journey starts on www.Bitfinex.com and selecting “Sign Up.” Provide an active email, official names, and a password. Before trading, traders are required to verify their accounts. However, although new users are not subjected to identity verification on their first sign in, it may be required to do so as they continue using the platform.
New Bitfinex traders are only allowed to deposit Bitcoin into their accounts. To access this functionality, click on “Wallets>Deposits/Withdrawals.” This generates a new Bitcoin deposit address. Access another wallet, for example, on Binance, and choose “Withdraw” and provide the deposit address. Also, traders can deposit fiat currencies in USD, EUR, CNH, JPY, and GBP.
Once the Bitcoins arrive in the Bitfinex wallet, it’s time to start the trading journey. On the homepage, click on Bitcoin to get to the BTC trading interface. To buy ETH, select the ETH/BTC market and select the amount of Ether. Next, select the type of order, hit “Exchange Buy” and wait for Ether to arrive in your account.
Withdrawing Bitcoin from Bitfinex
To withdraw from Bitfinex, click on “Withdraw” and select Bitcoin, provide a withdrawal address, and complete the process. Unlike Binance, where the withdrawal is almost instant, withdrawal on Bitfinex can take longer, sometimes up to seven days. One reason that a withdrawal may take longer is if a trader has not activated two-factor authentication.
Is Bitfinex secure? Bitfinex places a mandatory activation on a 2FA through SMS or Google Authenticator. To set up a 2FA method, click on “Security” and navigate to “Two-Factor Authentication.” Follow the prompts to add an extra security layer. Other security measures include limiting account access to an IP address and setting up a confirmation phrase when withdrawing.
Advantages and disadvantages of using Bitfinex
- Offers leveraged trading.
- Has a high trading volume.
- Has an easy to use interface.
- Has an account liquidity restriction of 10K USD.
- It’s Bitcoin’s price is not always at par with other exchanges.
- It has been entangled with law enforcers putting a curtain on its credibility.
How to trade Bitcoin on BitMEX
Launched in 2014, BitMEX leads in margin trading with leverages of up to 100X. It’s worth noting that margin trading carries a high possibility of profits and an equally high possibility of losses. Its popularity has seen more than 10 million users access the platform every month.
Creating an account
First, a trader needs to be over 18 years old and not a US citizen. Visit the official BitMEX website, select “Register,” and provide an official name, country of residence, and a valid email. Clicking the “Register” button at the end sends a verification email. Follow the directions to get it activated within minutes. It’s time to trade, but first, deposit funds.
The layout on BitMEX is a bit different. The “Deposit” option is found under “Account>Wallet>Deposit.” . Also, while there’s no deposit fee, the platform substitutes that with network fee that fluctuates with the transaction size. When depositing BTC on Bitfinex, follow the same process as on Binance.
On the upper part on the left side of the main page, click “Trade” to open the window with the order book, technical indicators, and a list of tradeable coins. The spot trading option is labeled “Market” under “BitMEX.”
To withdraw, select “Account>Withdraw” and provide the deposit address. Follow the same steps as when withdrawing from Binance.
To access the security settings, go to “Account>My Account.” Here, a trader can set the two-factor authentication to add a layer of security. This security option is required each time a trader withdraws from BitMEX.
Advantages and Disadvantages of BitMEX
- Best for leveraged trading.
- Has a high derivative volume.
- Does not require a ton of personal information to start trading.
- Not accessible to crypto asset traders in the United States.
- Not suitable for novice traders with less leveraged-trading experience.
How to trade Bitcoin on Bitstamp
Bitstamp’s user base is concentrated in Europe. Being a regulated digital currency exchange, Bitstamp is credible compared to other unregulated exchanges. Unfortunately, unlike other exchanges like Binance, the platform has fewer tradeable coins.
Creating an account
The creation process starts on Bitstamp.net. Hit “Register” and select whether the account is for individual or corporate trading. Note that each option will have different registration requirements. Due to its regulated nature, the exchange asks for residence details, proof of residence, government-issued ID, among other details in compliance with anti-money laundering and know-your-customer policy.
Funding a Bitstamp Bitcoin account
Bitstamp supports funding either through another cryptocurrency wallet like the Ledger Nano X or directly from a credit card. Credit card crypto purchases on Bitstamp supports major coins such as Bitcoin, Ripple (XRP), Litecoin (LTC), Ether (ETH), and Bitcoin Cash (BCH).
To deposit, select “Deposit>Credit Card.” Deposits in fiat currencies can also be made through International Wire Transfer and SEPA.Fiat deposit can be traded in exchange for cryptocurrency. Depositing funds from another wallet is similar to when depositing funds on a Binance or Bitfinex account.
Time to trade
The platform has a basic and advanced interface for traders. Some features that lack on the basic interface are technical price indicators and some parts of the order book. For newcomers in the crypto industry, select “Buy / Sell > Basic.”
Traders on the advanced interface enjoy features such as a depth chart, trade history, order executor, and a full order book.
This process originates from the “Withdrawal” section found on the upper part of the account page. Bitstamp supports external cryptocurrency wallets and withdrawing directly to a global bank or a bank within the European Union. Withdrawing to an external wallet is similar to the process discussed under Binance.
Bitstamp’s 2FA options.are accessible by clicking “Security>2 Factor Authentication.”
Advantages and Disadvantages of using Bitstamp
- It’s regulated.
- It’s transparent and secure.
- Ideal for new traders.
- Does not support Tether (USDT) trading pairs despite USDT being the largest stable coin.
- Has very few tradeable cryptocurrencies.
- Credit card crypto purchases are expensive.
How to trade Bitcoin on Bittrex
If you’re in the United States and torn on where to trade Bitcoin, look no further. Bittrex has been operating in the US crypto market since 2013 and is among the leading three crypto trading platforms in the country.
Creating an account
As with other platforms. A request to join Bittrex starts with a user providing an email address and password. Accessing the link in the verification email leads to the terms of service page. Once accepted, a trader will access other parts of their account. One of those parts is the deposit section.
Click on “Wallet” and choose the crypto to deposit to reveal the deposit option. Choose Bitcoin and select “Deposit>Generate a new wallet address.” From here, follow the normal deposit process. Note that you can deposit either fiat, Bitcoin, or a wide range of other coins. However, fiat currency deposits must not be less than $1000.
To start, select “Markets” from the upper corner of the landing page and choose Bitcoin from the list of tradeable coins. The next window shows an order book, price chart, among other details. Bittrex allows traders to choose different order types, such as good-til-canceled (GTC) and immediate-or-cancel (IOC). On other exchanges, GTC can be referred to as a limit order, while IOC can be thought to be a market order. Withdrawing from Bittrex is similar to the deposit process. Bittrex supports extra security through 2FA.
Advantages and Disadvantages of Bittrex
- Ideal for new users.
- It’s secure.
- It’s stable.
- Fiat deposits have a minimum of $1000.
- Has a lengthy onboarding process.
Frequently asked questions
How do I start trading Bitcoins
To get down to Bitcoin trading, a trader needs to select a platform that has all the markets needed and which matches their level of expertise. This is followed by creating an account, funding the account and subsequently trading Bitcoin.
How does Bitcoin trading work?
In a BTC trade, profit is made by buying when the price of BTC is low and selling when it appreciates. However, when and how to anticipate for a low or a high depends on the trading strategy employed. To make the most out of a BTC trade, a trader has to understand the cryptocurrency market and what drives the prices.
From the above outline, it’s evident that Bitcoin trading is similar on all crypto trading platforms. However, the security level, price range, and sign up process differs from one exchange to the next. When looking to trade Bitcoin and save on transaction fees, then Binance is your best bet. But, for those in the US, Bittrex is the best. To engage in leveraged trades, BitMEX will do the trick provided the trader is outside the US. Another easy to use platform is Bitstamp, although it has very few listed coins. The security on all the platforms remains strong. Note that making profits from BTC trading depends on the trading strategies used.