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Reviewed
If you’re interested in buying cryptocurrency, you need to open an account with a crypto exchange. There are around 500 examples to choose from, and Forbes Advisor combed through the leading crypto exchanges to determine the best crypto exchange for both new and experienced investors.
We performed an in-depth assessment of the features and options offered by nearly 25 cryptocurrency exchanges, crypto trading apps and brokerage platforms that offer crypto trading options.
The trading fees reflected for each brokerage or crypto exchange are the trading fees for the lowest volume of trade, using the most basic version of the platform.
The data addressed 10 key variables to assess the quality of each platform:
These ten variables benchmark features and options across the crypto exchanges and brokerages we surveyed.
For each ranking, the sum of weighted values across all or some of these key factors was calculated to award each brokerage or exchange its overall rank. Margin trading, platform lending and advanced trading were not considered for choosing the best crypto exchanges for beginners.
To learn more about our rating and review methodology and editorial process, check out our guide on How Forbes Advisor Rates Investing Products.
A crypto exchange is a marketplace where you can buy and sell cryptocurrencies, like bitcoin, Ether or Dogecoin. Cryptocurrency exchanges work a lot like other trading platforms that you may be familiar with. They provide you with accounts where you can create different order types to buy, sell and speculate in the crypto market.
Some crypto exchanges support advanced trading features like margin accounts and futures trading, although these are less commonly available to U.S.-based users. Others have features like crypto staking or crypto loans that allow you to earn interest on your crypto holdings. The best exchanges offer educational offerings to keep you up to date on all things crypto.
Crypto exchanges work a lot like brokerage platforms. Each offers a portal where you can create different order types to buy, sell and speculate on cryptocurrencies with other users.
Broadly speaking, there are two categories of crypto exchanges: centralized exchanges and decentralized exchanges. Each category comes with its own advantages and disadvantages.
Centralized crypto , or CEXs, are managed by one organization. Centralized exchanges make it easy to get started with cryptocurrency trading by allowing users to convert their fiat currency, like dollars, directly into crypto. The vast majority of crypto trading takes place on centralized exchanges.
The major concern with centralized exchanges, however, is hacking. With a CEX, the exchange holds the crypto traded on its platform—at least in the short term, while trades go through—raising the risk of hackers stealing assets.
To address this risk, centralized crypto exchanges have beefed up security over recent years. Among other strategies, they now store most customer assets offline and take out insurance policies to cover crypto losses in the case of hacking.
If you like the convenience of a centralized exchange, you can reduce your risk by transferring crypto to a separate, off-exchange hot or cold wallet.
Decentralized crypto exchanges, otherwise known as DEXs, distribute responsibility for facilitating and verifying crypto trades. Anyone willing to join a DEX network can certify transactions, much like the way cryptocurrency blockchains work. This may help increase accountability and transparency as well as ensure an exchange can keep running, regardless of the state of the company that created it.
The trouble is that decentralized exchanges are much less user friendly, not only from an interface standpoint but also in terms of currency conversion. Decentralized exchanges, for instance, don’t always allow users to deposit dollars and exchange them for crypto. This means you either have to already own crypto or use a centralized exchange to get crypto that you then use on a DEX.
There are nearly 600 cryptocurrency exchanges worldwide inviting investors to trade bitcoin, Ethereum and other digital assets. But costs, quality and safety vary widely.
You pay two types of fees when you buy and sell crypto: trading fees and withdrawal fees.
Beyond fees, when choosing the best crypto exchange for your needs, consider things like:
As crypto has grown more popular and valuable, it’s become a big large target for hackers. Leading exchanges like Binance and KuCoin have been hacked, resulting in tens of millions of dollars in losses. While exchanges often reimburse those whose coins are stolen, nobody wants to be in that position in the first place.
You can minimize your risk by spreading your crypto purchases across multiple exchanges. Alternatively, make it a habit to move your crypto holdings out of an exchange’s default wallet to your own secure “cold” wallet. These are storage options that are not connected to the internet, making them nearly impossible to hack—although you’ll need to carefully record your passcode or you could lose access to your crypto forever.
Carefully consider the cryptocurrencies available on a given exchange. You might be perfectly fine using a crypto exchange that only trades a few coins. Conversely, if you’re a crypto fiend, you may want access to all of the more than 600 available on Gate.io.
The availability of coins alone isn’t sufficient if there are no trades happening. You’ll ideally want to verify that there’s sufficient trading volume in your target coins to ensure liquidity, so you can easily trade your coins and dollars.
Low-volume markets could cost you on sales. If there’s not a lot of volume and you put an order in, that’s called slippage. You could end up buying at a higher price or selling at a lower price than you’d want.
If you’re an advanced crypto trader, you may want to make sure your preferred exchange offers the trading types—like limit orders, which can prevent slippage by setting a hard price—and margin you want. Remember trade types involving the latter are still evolving in the U.S., so different exchanges’ offerings may vary over time.
If you’re just getting started with cryptocurrency, look for an easy-to-use platform with plenty of educational resources to help you understand this complex, rapidly developing market.
Finally, don’t assume that an exchange is available in your country, or even state, just because you can access its website. Many state and federal governments are still figuring out how exactly they want to treat cryptocurrencies from a legal and tax standpoint.
– Mikkel Morch, founder of ARK36
Binance, Coinbase and Bybit are among the largest crypto exchanges by trading volume.
Exchanges have different requirements, often depending on the type of cryptocurrency you want to buy.
You may be able to buy fractional shares of coins for pennies or just a few dollars. Be sure to check your chosen crypto exchange’s requirements for the coin you want to buy.
To open a crypto exchange account, visit the exchange’s website or download its app.
Each crypto exchange has its own unique registration process. With some, you may be able to make an account and buy and sell small amounts of crypto without verifying your identity or submitting much sensitive information.
But as the industry has evolved, the U.S. government has introduced certain Know Your Customer regulations to prevent money laundering and fraud.
In general, you’ll need to provide:
You may also have to verify your identity by submitting a photo or scan of a government-issued ID.
Cryptocurrency exchanges make money in a handful of different ways. They can either charge fees for transactions, charge additional trading fees, earn interest by lending crypto to traders, charge listing fees for tokens or coins listed on their platform, earn a profit through market making (providing users liquidity) or any combination thereof.
Just like when working with different brokers for trading stocks, fees can vary from crypto exchange to crypto exchange. If you want to find the exchange with the lowest fees overall, you’ll want to research trading fees, transaction fees and any additional fees for every individual exchange. Then, do your own calculations to determine which exchange actually has the lowest fees.
As of March 2023, it was assumed there were more than 550 crypto exchanges in operation throughout the world. However, that number has been estimated to be as high as 1,500.
Most crypto exchanges report their U.S.-based customers holdings to the IRS. Of the world’s largest crypto exchanges, it has been reported that KuCoin does not report information directly to any U.S. governmental organizations, including the IRS. However, KuCoin is also not licensed for use anywhere in the United States.
