With global digitization, there is a significant rise in cryptocurrencies, hence, there are more than 1600 cryptocurrencies across the globe that are holding a market value of $289 billion. The rapid adoption and most of the jurisdictions making it legal tender are backing the whole crypto ecosystem to grow exponentially. Therefore, many digital crypto money exchanges have emerged in recent years that are all set to fulfill the needs of the advanced trading infrastructures and investors’ needs.
Money trading with digital money is becoming a new norm. Crypto online exchanges are allowing crypto enthusiasts to buy crypto with government-issued currencies like dollar, yuan, euros, etc. in addition to this, most exchanges are permitting digital currencies like Ethereum and Bitcoin to purchase other currencies, yet these services are limited to some jurisdictions. However, with the advent of cryptocurrencies, an all-new set of laws and standards have been also legislated for these exchanges, aiming to secure the crypto ecosystem.
Cryptocurrency Exchanges – Brief Overview of Types
Cryptocurrency exchanges are providing digital services that enable individuals and investors to buy or sell virtual assets, all in one place. Moreover, most of the crypto exchanges to buy with fiat are primarily focused on providing robust trading schemes that can allow investors to gain instant profits by trading with fiat currencies. On another hand, there are few cryptocurrency exchanges and platforms that also provide the ease of using bitcoin and other big coins to buy, sell or trade with other cryptocurrencies. Thus, there are three types of cryptocurrency exchanges that are helping people to become the party crypto regime. Let’s dive into their concepts.
Centralized Cryptocurrency Exchanges
Centralized digital crypto money exchanges are also known as CEX, which almost works similar to the conventional stock exchanges. The investor who pays a visit to the cryptocurrency platform could either be a buyer or seller that plays the role of intermediaries. In the cryptocurrency ecosystem, a centralized system means handing over your funds to intermediaries while putting all faith in the platform. However, CEX is significantly vulnerable to cyberattacks i.e hacks and data breaches. Thus, to secure the operations a rigid set of anti-money laundering and know your investor regulations are legislated that assures that investors’ funds and assets are protected from any kind of hack, hence, investment remains in safe hands.
In addition to this, centralized cryptocurrency exchanges are mostly preferred by the investors as they have the potential of facilitating large transaction volume, and hold high liquidity. Furthermore, CEX is particularly for beginners that are new and don’t have enough knowledge to survive in this fast-moving market.
Decentralized Cryptocurrency Exchanges (DEX)
The second type of cryptocurrency exchange is decentralized, which comes with the aim of securing and ensuring the key concept of digital currencies “anonymity”. Therefore, DEX doesn’t depend on intermediaries of third-party vendors to invest or hold investors’ funds.
Decentralized cryptocurrency exchanges are a digital marketplace where both sellers and buyers can easily interact with each other in order to carry out transactions or trade currencies while ensuring the identities of both parties remain anonymous. Furthermore, these types of exchanges also provide peer-to-peer trading facilities. Unlike centralized exchanges, these are hard to breach, therefore, all transactions and investments remain protected.
However, DEX is not as popular as centralized exchanges. It is because these platforms have low trading volume along with low market liquidity. In addition to this, as these exchanges need to ensure anonymity, hence they are not governed by central authority nor require customer verification. Yet, if customers are looking to use fiat-to-crypto trading, one might need to undergo a verification procedure.
Hybrid Cryptocurrency Exchanges
While keeping the next-generation cryptocurrency marketplace, with the blend of centralized and decentralized exchanges, a whole new crypto exchange has recently emerged, which is called the hybrid exchange. This type of exchange holds the key aspects of DEX to ensure anonymity and CEX to ensure high liquidity. Thus, crypto experts also believe that this kind of exchange is the future of money trading with digital currency.
Buy Crypto Online with Credit Card
There are heaps of individuals as well as investors who don’t want to directly invest in cryptocurrency exchanges. However, reasons vary, some don’t have proper payment gateways and some are new to this industry. Therefore, crypto exchanges to buy with fiat are providing an option to buy crypto online with a credit card. To do so, the investors need to pick well-reputable digital crypto money exchanges that provide digital coin credit card transactions as not all the exchanges are providing these services based on jurisdictions’ requirements. Moreover, these exchanges have a customer-friendly and easy-to-use interface that allows investors to onboard the platform seamlessly. Investors just need to integrate their credit cards as a payment option, and they are all good to go for making payments.
No doubt, digital crypto money is considered the future of payment. Having in mind the key fact, that cryptocurrencies are backed by blockchain technology and cryptographic algorithms, sooner and later governments and financial watchdogs will eventually legalize crypto assets. Therefore, becoming part of the crypto ecosystem and investing in digital assets will surely help investors in near future.