Cryptocurrency exchanges are a lot like the auction house in World of Warcraft . Like in WoW, you buy and sell digital goods, except this time you buy and sell, say, Dogecoin instead of Crystallized Anxieties .
Cryptocurrency exchanges help traders acquire or sell cryptocurrencies. They do this by converting fiat currency (real currency backed by a government) into the digital currency of your choice (and vice versa when you sell). Some players only take real money. Others only accept digital currency. All of them charge fees in one way or another, which is key to their profitability.
It goes without saying, but we say it here: investing in cryptocurrencies is extremely risky. Investing in cryptocurrencies involves transferring real, hard-earned money for bits generated by a purposely obtuse algorithm, in the hope that enough other people will believe in those bits that they somehow become so real. If it makes your hair stand on end, that’s normal.
But some of you will be brave enough, or crazy enough, or rich enough that it doesn’t matter, and will spend tangible money in exchange for imaginary money. Good luck. There are people who make money with this stuff. Not us, but someone does.
How we made our selections
We conducted a literature review of results from six financially oriented sites that ranked exchanges and aggregated these results. By examining the results of raters on the Internet, we are more likely to paint a reliable picture, while avoiding picking winners in a market that has yet to be regulated.
Across all sites, we have identified 43 cryptocurrency exchanges. Out of these 43 exchanges, 29 of them have been reviewed by only one site. As we try to find out how they are perceived on the internet, we have removed all sites listed by a single actor. We also removed six other scholarships that only appeared on two sites. None of them were close to the top of their respective reviewers’ list, so there was no great loss.
This leaves us with six vendors tested at three or more sites, which gives us a good starting point. Of these six, three exchanges (Coinbase, Gemini, and Kraken) received top marks. Two sites rated on a scale of 1-5 and one (BitDegree) on a scale of 1-10. We converted the BitDegree rating to a scale of 1-5 (dividing the ratings by two), which allowed us to tabulate the average ratings for the four exchanges for which we had sufficient representative data.