Many newcomers, especially professional traders, take the choice of trading platform very seriously. Therefore, if you’re looking for a suitable exchange and want to stay there for a long time, you’ll find this article quite helpful. However, this material will have little value for the users who just want to change fiat for any type of cryptocurrency to save it in future.
We should start by saying that all the existing exchanges can be divided into the following categories:
- altcoin exchanges;
- fiat exchanges;
- fiat-crypto exchanges;
- crypto – crypto exchanges.
The name depends on the currency supported by the certain exchange.
And now we will talk about the disadvantages and benefits of fiat-crypto exchanges.
To start with, we should find out the true purpose of exchange. First of all, trading on such platforms is comfortable, as the users don’t have to use online-exchangers to withdraw the means in cryptocurrency. Such scheme allows you to exclude additional fees (for example, for transfers). It all comes from the fact that the exchange assumes the role of online-exchangers.
However, not all the users and experts consider this factors as an advantage.
Another aspect is the supported tokens and their amount. After the user buys one-two kinds of cryptocurrencies, (for example, Ethereum or bitcoin), he/she may want to come to the market and start playing. One can also consider the option of investing in various projects (for example, in start-ups). In this case, the client won’t be able to get what he/she needs from the exchange, because it supports a small amount of coins.
We should also mention the banks and a number of other organizations. The thing is that the exchange will need to receive confirmation from the banks or a number of other financial organizations for the prior approval of every token. The exchange works with them before they will be added to the platform. Fiat exchanges have a limited range of activities, as they have a restricted amount of supported tokens.
But if you look at this situation from the other side, it can be a good option. The thing is that every cryptocurrency is thoroughly checked at an early stage. Therefore, any user of fiat-crypto exchanges can safely say that they’re all safe.
Another important point we should focus on is the speed of exchange operation. This factor is very important, as the speed of reaction is essential for any trader. Speaking of fiat exchanges, they have a great disadvantage – lack of capacity. Evidence of this is a situation that could be observed in 2018 between January and February. That is when the market had been subjected to serious correction. At that moment, the fiat exchanges that didn’t stop to register the new users were especially distressed. As a result, such actions have caused the procrastination of verification and transactions.
The reason for this situation is that the fiat exchanges spend much time on working with the banks. A lot of different processes take time. As a result, the resources spent by platform get the minimum payback. Therefore, the one-time use of such platforms doesn’t permit to accumulate capital in a short time.
Speaking of the crypto- crypto exchanges, they also have their shortcomings and advantages. For example, before using the exchange services, the user has to exchange his/her money (dollars, pounds, yuan, etc.) for cryptocurrency. To that end, people usually use different exchangers (which means additional commission and lost time).
According to the service “Coin ATM Radar”, currently there are about 2708 АТМs allowing exchanging cryptocurrencies worldwide. In total, they are serviced by 393 operators, while the terminals can be found in 66 countries. Of course, there are countries that don’t have any ATM, allowing the user to exchange any cryptocurrency. At that, we mean not the backward countries but some European states. However, it is indisputable that ATMs are a very comfortable instrument, allowing users to withdraw cash, exchange money and execute a number of other financial operations.
At that, we shouldn’t overlook the fact that not every owner of cryptocurrency knows how to use crypto exchanges and execute different transactions using this type of currency. Therefore, well-known ATM and credit card is a model familiar to everybody, as it’s difficult to find a modern civilized person who doesn’t know how to use ATM.
Speaking of a number of European countries (especially those of the former Soviet Union and the Soviet camp), this kind of business have rather cloudy prospects there. And yet, domestic users actively change, mine and buy the cryptocurrency. There are many local investors who want to invest in the digital assets. The only limitation is a lack of legislation, which would allow everybody to act within a legal framework.
Recently, it is often spoken about the emergence of the draft laws, which would permit to open the automated sale points of tokens and cryptocurrency on the territory of the above-mentioned countries (with a possibility of full de-anonymization of the client). However, this can cause conflicts with the other financial institutions of these countries.
It is therefore reasonable to conclude that many countries, which don’t have any cryptocurrency ATMs at the moment, will get no more than one – two such exchangers. At that, they will be considered as behind-the-scenes toys for the people who ignore the current financial legislation. It must also be borne in mind that there are no projections on how long these machines will exist.
Considering the current situations and all the above-mentioned perspectives, in many counties the owners of cryptocurrencies have to work in uncomfortable conditions. To date, they don’t have an opportunity to freely operate these means, as an infrastructure for their quick exchange, cashing and executing other operations has yet to be established.
The only consolation in this situation is that cryptocurrency isn’t popular enough (even in the developed countries) to be easily cashed in any ATM. You must admit that 2708 АТМs are not enough to speak about comfort. However, the development of this segment of financial market and exchange rate fluctuations attract a lot of attention to cryptocurrency, which is why it starts to “overgrow” with different services.
While just a few years ago only certain groups of people have heard about cryptocurrency, now the information support of this segment is more than sufficient. Any modern person, who uses Internet, watches TV and listens to the radio, knows at least something about cryptocurrency.
Therefore, in this matter we have to be patient and monitor developments. Perhaps, it wouldn’t be long before the first cryptocurrency ATMs will appear in our country.