When assessing the reliability of a cryptocurrency exchange or an exchange service working with cryptocurrency, it is worth paying attention to several important factors. Experts told “RBC-Crypto” on how to choose the right trading platform for the 2024 market.
Jurisdiction and security
Founder of TerraCrypto Nikita Vassev
In 2023, several large crypto exchanges, including Binance and Coinbase, faced regulatory pressure. A year earlier, the market experienced the collapse of what was once one of the largest trading platforms – FTX. As a result, the crypto community has become more cautious when choosing exchanges, but there are several steps that will make choosing a trading platform for work easier.
Find out if regulators have any complaints about the crypto exchange. Particular attention should be paid to trading platforms that operate in the USA. Practice has shown that American regulators are studying with particular passion the business of crypto exchanges that offer services to American citizens. At the same time, a lot of gaps in the regulatory framework do not prevent US regulatory authorities from issuing strict verdicts.
To reduce risks, choose trading platforms that do not operate in the US and have not faced regulatory pressure.
Study the functionality of the trading platform and working conditions. As a rule, the larger and more popular the crypto exchange, the higher the commissions. At the same time, it is large trading platforms that offer the widest selection of instruments and convenient channels for converting cryptocurrency into fiat money and vice versa.
Pay attention to the security settings. Find out exactly how the crypto exchange stores user assets and what tools it uses to prevent security breaches.
Pay attention to restrictions. Due to the geopolitical situation, many trading platforms have refused to serve Russians. Some crypto exchanges have also removed the ruble from trading pairs or their own p2p services.
Find out what security incidents the trading platform has experienced. Often hacks are a reason to work on bugs. In the context of the crypto industry, such incidents, no matter how strange it may sound, increase the security of trading platforms. Of course, the best choice would be a crypto exchange with extensive experience and whose security systems have never been compromised.
Among the general recommendations:
- do not trust trading platforms that are presented anonymously;
- choose crypto exchanges that offer reward programs for finding vulnerabilities among so-called white hat hackers;
- Please read the user agreement carefully before creating an account.
Working with rubles and strategy
Former head of Asia and Eastern Europe at Binance Gleb Kostarev
Choosing a cryptocurrency exchange in 2024 requires a careful approach. First of all, it’s worth checking whether the exchange continues to serve Russians. Unfortunately, in 2023, many exchanges introduced restrictions on users from Russia. For example, Binance announced it was leaving the Russian market and selling its business in the country to the CommEx platform, and OKX removed the ability to trade rubles on its p2p platform.
The next important factor is the reliability of the exchange. Unfortunately, 2023 was marked by a number of major hacker attacks. The attackers managed to steal funds even from such well-known platforms as HTX (formerly Huobi), Poloniex, Coins.ph and others. Therefore, you need to study from all sides the site to which you plan to entrust your funds.
From a product perspective, users have the opportunity to trade on both traditional (centralized) exchanges and decentralized ones (for example, Uniswap, 1inch, dYdX or GMX). Decentralized ones are more suitable for those who are already familiar with the world of Web3 and want to dive deeper into the field of decentralized finance (DeFi), know how to use wallets and pay fees for transactions on the blockchain. Centralized exchanges still have a more friendly and understandable interface for beginners. In addition, professional traders who value speed also prefer such platforms.
And finally, it all depends on the trading strategy. For long-term investors, it is worth looking for platforms that offer higher interest rates on Earn products. At the same time, liquidity on different instruments, the number of trading pairs and new listings are important for daily trading.
Rules and purity of funds
Senior analyst at Bestchange.ru Nikita Zuborev
In addition to basic security principles, such as whether the site has an exchange or exchange office SSL certificate and that the domain (site address) is at least six months old, you should check the reputation and correctness of the URL in the address bar. There are directories for crypto exchanges, such as CoinMarketCap or CoinGecko. Aggregators of exchange offices are called monitoring. If the service you choose is not on most major lists, the risk of being scammed is high.
It is important to study the rules of the site, in particular, in what jurisdiction it operates, what kind of relationship it has with residents of your country, what requirements are there regarding the verification procedure (know your customer, KYC) and anti-money laundering (AML).
Some large crypto exchanges were forced to refuse cooperation with residents of Russia and Belarus, so it is important to check such nuances before transferring funds to the service’s wallet. Usually it is enough to make sure that the built-in p2p gateway of the exchange supports cards of Russian banks, but it is better to find confirmation in the announcements of the press service of the selected company.
To determine jurisdiction and potential problems, you should look at the sections “Site Rules”, “AML/KYC Policy”, “Return Policy” or similar. Usually they contain all the most important information: in what cases and in what format identity verification will take place, by what laws the circulation of cryptocurrency is regulated, and how the exchange rate is formed.
Today, the overwhelming number of crypto services in the world comply with AML legislation in a proactive mode: each incoming transaction is assessed for “purity” and can be delayed until the data is clarified. Therefore, if you have doubts about the “purity” of funds, or you fundamentally do not want to undergo verification, you should independently assess the purity in advance using special services available upon request “AML verification of cryptocurrencies.”
Some monitoring also helps in collecting such information – they indicate the country of location of the service, as well as all potential obstacles, such as the need to take a photo of the card, or providing passport data. Pay attention to any little details if you don’t want to waste time resolving the dispute later.
Source: Cryptocurrency
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