How to Choose A Cryptocurrency Broker

How to Choose A Cryptocurrency Broker

Cryptocurrencies have rapidly evolved from a disruptive concept to major financial assets within a decade. Despite frequent fluctuations, the overall market cap for these digital assets is rising gradually and exceeds $1.1 trillion as of March 2023. The rising demand for crypto has triggered the new-age gold rush, with companies adding crypto trading services to their operations.

Users can access crypto products in two main ways: crypto exchanges and (or) crypto brokers. Crypto exchanges, like OKX and Binance, are platforms that connect buyers to sellers and facilitate direct trades based on current market prices. In contrast, a crypto broker offers a simplified way to trade digital assets via an intermediary based on prices set by the intermediary.

Each of these methods offers unique advantages to users. Some advantages of trading crypto via a cryptocurrency broker include:

  • Easy to set up a crypto trading profile
  • Access to leverage – borrowing funds to increase your position
  • Faster settlement of trades via the broker
  • Fairer crypto prices

Not all crypto brokers offer the same experience. You may prefer one broker over another based on your preferences or investment goals. Still, you must watch out for unreliable brokers. Before starting your crypto journey, here is a detailed guide on how to choose a cryptocurrency broker.

1.    Verify the Broker’s Credibility

Is the broker regulated? First, check whether the broker you have considered is regulated satisfactorily per your jurisdiction’s policies. Cryptocurrency trading attracts many risks, including exposure to security threats, crime, and to a greater extent, financial risk. As such, many governments have set guidelines to govern crypto-related operations and protect citizens.

Besides regulation, the broker should demonstrate credibility through transparency and honesty in its marketing operations. Be cautious of brokers that list non-existent services or make bold and unrealistic promises to potential traders. For instance, a broker guaranteeing quick riches is likely a scammer considering crypto price volatility.

Another indispensable way to determine the broker’s credibility is by reading users’ reviews. Verified reviews help you to learn from the experience of people who’ve used the broker’s services. As part of your due diligence process, this step will help you to make a more informed decision when selecting a broker.

2.    Assess Platform Security

Cryptocurrency brokers handle sensitive personal information and user funds. These two components make brokerage platforms highly attractive for threat actors. As a potential trader, you must ascertain that the broker you consider has a robust security system with a track record to match it.

One basic security check is if the broker’s website has an SSL certificate for secure connections when submitting your information. Comb through the reviews to read what other users say about the broker’s security. Additionally, check the internet for any news regarding security breaches the broker may have suffered. If there are any, review how the broker handled and resolved the breach. You may consider the company if it successfully fixed the breach while staying transparent and upfront.

3.    Compare Brokerage Fees

Compare Brokerage Fees

Primarily, cryptocurrency brokers generate revenue by imposing fees and commissions on transactions. Some brokers may declare all fees while others apply hidden charges within the spreads. (Spread is the difference in the buying and selling prices of a cryptocurrency, as set by the broker.) Making profits may be difficult for wider spreads, as it would require large crypto price movements.

Other brokers require minimum deposit amounts for account holders, ranging from $0 to thousands of dollars. Further, the crypto sector is fairly new, and brokers may charge higher fees, unlike traditional assets like forex and stocks. Again, these charges will vary depending on the broker.

Compare different brokers and consider their fees against other factors to determine your preferred broker.

1.    Access to Educational Resources

Most cryptocurrency brokers have intuitive user interfaces (UIs) suitable for beginners. Even then, beginners need to learn core cryptocurrency trading concepts to inform their trade decisions. A good broker will provide comprehensible educational resources comprising how-to guides, deep dives, and simple illustrations, among others. Some brokers go a step further to provide resources for beginners, intermediate, and expert-level users.

Look out for brokers that offer demo accounts. A demo account allows you to practice crypto trading without risking your funds. The free account holds virtual funds which you can spend to test possible trades under actual market conditions. This way, you can master fundamental crypto trading strategies and be a better trader.

2.    Leverage and Markets Availability

Growing your portfolio is most likely part of your crypto investing goals. As you gradually increase your portfolio size and gain more experience in crypto trading, you will need ways to maximize returns on your assets.

One way to achieve this is through leverage. Compare the leverage amount from different brokers and select one that matches your risk appetite. Keep in mind that crypto trading is highly volatile, and price movements may hurt your account’s performance.

Another way to increase your potential returns is by accessing more markets. When starting your crypto journey, one or two cryptocurrency pairs are enough. However, as you grow and seek to diversify your investments, a broker that offers multiple markets and cryptocurrency pairs will come in handy.

3.    UX & Technical Support

You will likely encounter problems during your trading journey. In such cases, you will need fast-responding customer support that is honest and knowledgeable. This technical support is crucial for ensuring you get near-instant assistance and resolve issues beyond your expertise. Therefore, before settling on a broker, ask yourself how easily you can access technical support.

UX & Technical Support

Alongside technical support, consider the overall user experience (UX) on the platform. One good hint of a broker’s reliability is the simplicity and user-friendliness of its sign-up process. Another indicator is the customer reviews – again! Read the reviews made by existing platform users to establish how they feel about the broker. You can access reviews from multiple sources, including Google, Trust Pilot, and app stores.

Choosing a cryptocurrency broker may be a tedious process that involves filtering through tens – even hundreds – of brokers. While selecting your preferred broker, ensure they check the boxes for credibility and security. These two factors are a must-have for any broker.

Beyond these two, other factors like fees, market availability, leverage, and UX may be subjective. Make a thorough assessment of the select brokers to determine which one cuts it for your preferences.

To achieve excellence in any endeavor, it is crucial to approach it with a professional mindset. This is particularly true for learning, no matter the subject matter. With the abundance of training resources available online, it’s easy to be lured by the promise of free materials. However, the quality of these resources may be questionable. If your goal is to become a professional trader, it’s best to invest in a comprehensive learning program like Crypto Polish. I’ll explain why you should consider choosing us for reading trading broker reviews.

Focusing on More than Just the Fundamentals

While the initial packages offered by the trading education platform focus on the fundamentals, the advanced packages provide additional benefits to help you master the material. With access to knowledge checks and assignments, you won’t be left to your own devices when it comes to learning. There are also tests designed to assess how much of the material you have retained, giving you a clear understanding of where you stand.

Furthermore, the assignments included in these packages will help you apply what you have learned in real-world scenarios. By simulating different market conditions, you’ll be better prepared to face any challenges that arise. This type of hands-on education not only helps you learn but also equips you to perform in real-world situations.

It would be fair to say that this comprehensive approach to education ensures that you are fully prepared for even the most challenging market conditions, as you not only learn but are also tested and trained to respond effectively.

Offering Multiple Educational Resources

If you’ve explored online trading education platforms, you may have noticed that many offer access to a broad range of videos and eBooks, but without any clear organization or structure. However, Crypto Polish has taken a more sophisticated approach to education, providing its resources in a clear and structured manner. The education is divided into lessons and courses, with the number of materials increasing as you move up the package tiers.

These comprehensive courses are designed to cater to traders of all levels, with advanced materials available for those who have more experience. Additionally, the platform offers courses covering different aspects of trading, allowing you to focus on areas where you may need more help. Furthermore, each course comes with a specific study time recommendation, providing you with a clear understanding of the time needed to learn each topic thoroughly.

This organized and structured approach to trading education is what sets this trading education platform apart from other platforms. It offers learners a clear path to knowledge acquisition, ensuring they have the resources they need to become successful traders.

Learn Different Trading Concepts in Great Detail

When it comes to trading education, I personally categorize it into two parts: theory and actionable information. The former involves a lot of conceptual learning, where you gain knowledge about various trading concepts and strategies, and then have to apply them in your own unique way. On the other hand, actionable information is the kind that gives you direct instructions on what to do and what not to do.

I’m particularly impressed with how Crypto Polish has incorporated this type of education into their courses. By starting with the basics, you get access to a wealth of actionable information that can help you avoid common mistakes made by new traders. In my opinion, this kind of knowledge is incredibly valuable as it can save you from making costly errors that could derail your trading career.

I can highly recommending aspiring traders to sign up with a good copy trading platform like ZuluTrade because it is a great way to start trading when you don’t have a lot of knowledge or experience, especially if you’re looking for comprehensive trading education that includes both theory and actionable information. You’ll have access to a wide range of resources and materials that can help you become a more informed and successful trader.

Now you can go broker hunting!