Whether you’re a crypto newbie or an old-time amateur trader, it’s important to make sure you’re choosing a broker that has everything you need. Not sure what to look for? Well look no further – the experts at BrokerChooser have put together their top tips on finding the best online crypto broker:
1. Ensure they have a wide crypto selection
The most highly regarded digital assets such as Bitcoin, Ethereum (ETH) and Litecoin (LTC) are widely available on most brokers and crypto service exchanges but there are smaller digital assets however that may not be available in most broker product selections.
Due to this, if you’re serious about getting into trading crypto, it’s crucial to know which crypto assets each exchange/brokerage offers and weigh these up against your wants, goals and needs. For example, crypto exchanges have massive, real coin selections, but on the other hand, their safety is questionable compared to brokers. Brokers may offer a safer way to speculate on price movements, however, their crypto ETN / CFD / ETF selection may lag behind.
2. Check for credibility, reliability, safety and experience
As the cryptocurrency space is largely a brand new industry that is rapidly changing and not really subject to too much regulation, it’s important to check the credibility, reliability and previous experience of the exchange before jumping in.
There are two ways to trade crypto – either straight on a crypto exchange, or through a broker and a stock exchange with products specialized to follow crypto price movements. Just because it’s a new industry doesn’t mean there aren’t experienced, credible brokers providing alternate products to speculate on price movements. You can find reviews from a wide range of digital asset brokers on the BrokerChooser website.
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3. Make sure they have an easy to use trading platform
In a similar way to other financial assets, trading cryptocurrencies is more seamless with an easy-to-use trading platform, so it’s good to go with a broker who has a full-featured platform that is easy to use that you will understand how to navigate. You need a trading platform that helps you manage your investments easily and provides you with useful information and insights into your digital assets detailing fees, trading history, active positions, and current results.
4. The signup process, commission & fees
The signup process can tell you a lot about how a brokerage will operate.
It may be hard to tell initially what you should look out for in the signup process, but as you get to know more about the industry this will become second nature. Perhaps the biggest red flag to look out for is the request for a large deposit without any alternatives (e.g. different accounts with smaller minimum deposits).
Some reputable brokers providing cryptos ask for little to no money to sign up. This of course doesn’t mean of course that brokers asking for a bigger minimum deposit aren’t reputable.
5. Lookout for CFDs
Some brokerage portfolios contain or specialise in CFDs. These are complex and very risky instruments, thus not suitable for everyone. You can easily lose your invested money when you trade these products because of mandatory leverage. If you feel you need more info on what a CFD is, check out these CFD trading tips.
6. Assess your needs
It’s important to write a list of what you are looking for by getting into investing in digital assets so you can find the right fit for you. Everyone is different and there is not a one size fits all approach when it comes to trading in cryptos.
Written by Krisztián Gátonyi – Broker Analyst at BrokerChooser