With a high market value of over $700 billion, yet the cryptocurrency market has very little in terms of regulations. Many Bitcoin trading platforms like the Bitcoin Trader are growing very fast but without much attention to the security of investors.
This calls for why investors should take their fate in their hands by spotting red flags to choose only reliable Bitcoin trading platforms for their safety. Hacks have been recorded as well as failed attempts and it is sure the criminals are still out there trying.
It doesn’t stop at security though. Investors should be wary of a trading platform if they find it difficult to place an order? What features are there to examine to know what Bitcoin trading platforms are right?
With all these in mind, you should evaluate a trading platform just as you will for other institutions if you want your funds safe and secure. If you agree, here is how to select a legit Bitcoin trading platform that will meet your trading needs.
Find Out Details about the Trading Platform
This should be your first step. Get to know basic details about the trading platform. Research the founder as well as the market they are targeting.
Keep in mind that Bitcoin is still not regulated as a currency in some countries, things may improve in years to come, though. As the use of the cryptocurrency increases, the government of different countries is taking steps to have a measure of control of its transactions.
The issues of illegal operations like money laundering are good reasons why countries are paying good attention.
For the many reasons given, it is ideal you know the region of location of the Bitcoin trading platform before you choose to go for one. The location of such sites will determine the type of law you’ll be ready to abide with. Yes, it is true many countries don’t yet have solid regulations in place.
This shouldn’t make you feel all is okay because it can affect you in a manner you may not be able to handle. Stick with countries that are known to be friendly with their regulatory policies.
The reputation of the platform you’re dealing with says a lot about the security of your investment. If you find a platform with an anonymous founder, that is a red flag. Worse still is when such a Bitcoin trading platform has no reserve anywhere to show in the event that any eventuality happens.
How Easy It is to Use
A fake Bitcoin trading platform wants you confused. Things will be set out on the platform that you may clearly not understand why or are hidden. The simplicity of a trading platform says something about its legitimacy. Trading Bitcoin should be made open to people of different experience levels.
It shouldn’t be the case that only a pro will find it an easy one to use, NO. Amateurs should not be out of the scene. Even if you’re the pro, a good trading platform should provide you a simple and easy to use interface. It should be very intuitive.
Users should be at rest knowing a click on a button will direct to an expected section and not somewhere confusing.
A fast loading Bitcoin trading platform is one everybody loves, look at this too in your selection priority. If you plan on using the trading platform on the go, a responsive design should be in your consideration. You should look out if it supports iOS or Android apps on your smartphone.
The Liquidity of Trading Pairs is Important
When you’re done with knowing the trading pairs offered by a Bitcoin trading platform, you should not leave out knowing its liquidity. A high trading volume of a pair shows good liquidity. Many people are transacting with it and you won’t have problems or be slowed down during the trade.
Traders will also able to sell such currency without being affected by unusual price changes. There are websites that can show you the liquidity of trading platforms. Research them.
If you can’t get any information on this in reputable sites that offer such services, you may be toying with the wrong platform. It may just be paperwork that is presented to you.
Before you jump into the world, make sure you know the basics of Bitcoin trading, as many platforms will take advantage of your inexperience.
What is the Trading Fee?
Bitcoin trading platforms are not on charity, they are business entities. They make their money by charging some fees for transactions. It costs money to trade Bitcoins and other Altcoins.
When you have a trading platform charging fees you don’t know where it applies, it can be a scam to quietly steal from you. This gradual process may eventually run you out of funds to continue trading.
In most cases, a little percentage of each trade is charged. As much as we can tell, the percentage is usually less than the percentage of the trade. At most, it is a fraction in the first decimal place such as 0.3 percentage depending on the exchange you’re dealing with.
Reliable Customer Support
If there is any test you need to carry out about a suitable trading platform, it is on customer support. This is the most important of all the things you should not leave to chance.
An illegitimate Bitcoin trading platform will have no technical expert behind the system, let alone providing you good support. As a Bitcoin trader on an exchange, you should get prompt support when you find yourself in troubled waters with the platform.
This is vital mostly for newbies who are just starting out and will need prompt support to help them out.
There is no perfect system, things can go wrong, a good support team always makes the difference to save the day.
Security and Safety
It is no news that some Bitcoin trading platforms have been attacked by hackers. For the safety of your funds, check on the security put in place by the Bitcoin trading platform you intend going with.
The attackers may even be members of the trading platform; of course, this is usually the case that opens up access for them to carry out their nefarious acts.
Make a list of the security put in place and see if they’re enough for your fund’s safety. This list can help:
- Proof of reserve
- 2-factor authentication
- SMS and Email alerts
- Cold storage system
- Wallet monitoring 24/7
- PGP encryption emails
If the exchange does well to have all these in place, your funds should just be safe. You may still not need keeping all your funds in the exchange. Keep only what you need for trading and transfer the rest to your private wallet.
System Reliability a Must-Check
In the earlier times when the Bitcoin boom increased, many exchanges could not handle the higher volume. Thankfully, other Bitcoin trading platforms have sprung up afterward. The question of reliability should not be put out of the scene.
Make check of past system crashes and halts in the trade of a given Bitcoin trading platform before you choose it for your trade. You can visit reliable social networks such as Twitter or Reddit to know a bit more about the reputation of any exchange before you decide for it.
So, what more do you need for selection?
The process of finding a legitimate Bitcoin trading platform calls for a lot of commitment on your part. If it takes you the most time, you just have to sacrifice it at this time. Getting real users’ experience should be one of the final moves you may still have to make even if the above criteria are all met.
Users’ complaints after a time with the platform is one help you should explore. Go to Bitcoin forums where the trading platform is discussed and hear out what individuals who have used it have to say before you decide.
Reviews are also good. Find a trusted site that gives genuine reviews on Bitcoin trading platforms to see what people are saying about the trading platform you intend going with.
It can be an eye-opener for you, don’t ignore this aspect.
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