Cryptocurrency exchange services allow customers to exchange one type of crypto for other or crypto for fiat money. Offline crypto exchange services are used to exchange cryptos for fiat money. Applications are accepted on the site of the service, and the customer has to pick their money in the company’s office. At the same time, you can purchase or sell crypto online through online exchange services, with the rate set by the system.
An exchange or exchange service: what’s the difference ?
Pricing. Pricing depends on numerous players when it comes to the crypto exchange, while the rate offered by the crypto exchange service is set only by its owner. The most famous crypto exchange services link the rate to exchange rates, for instance, the exchange rate of BTC-Trade is linked to the current rate on BitStamp. But owners may also set the rate that is very different from current prices of the top exchanges, and sometimes this rate may not be profitable for investors. Some experts even say the main goal of exchange services is to purchase top assets at a cheaper price and sell them at a more expensive one. One more point to mention - you cannot choose the rate to purchase or sell crypto if you use services of the crypto exchange service. There is only one rate, unlike on an exchange, where you can place a limit order and conduct a transaction when the price reaches the desired level.
Working hours. Exchanges work 24/7, while many exchange services work only during the daytime, they are also closed during holidays and other days-off.
Protection from security risks. Most exchanges offer serious protection from hacker attacks, some exchanges may even compensate for losses from such attacks. Most exchange services cannot guarantee such protection level. In addition, exchanges keep their reserves in cold wallets and fiat money - on protected bank accounts. No one knows where exchange services keep their reserves.
Registration procedure. You have to register and verify your account to get access to a crypto exchange, while it is often enough to register on the site to purchase or sell crypto through an exchange service. In addition, it takes only a few minutes and several mouse clicks to exchange your currency through an exchange service that operates in the automated mode.
Additional features. Most exchange services are integrated with popular payment systems, such as QIWI and Web Money, Visa and MasterCard bank cards.
Many exchange services offer discounts for newcomers (for example, lower commission fees) and loyalty programs for constant customers.
Volume of reserves. Both exchanges and exchange services have their own reserves. The largest exchanges have hundreds of millions or even billions of such reserves, while exchange services have considerably less. The reserve of, as little as 10BTC, is considered appropriate for many exchange services, and they hold even smaller reserves of less popular cryptos. In addition, exchange services offer a considerably narrower choice of trading pairs.
So, if you need to quickly purchase cryptocurrency, but do not want to spend time trying to learn the basics of trading, exchange services are an option for you.
Here are a few tips for you that could help you choose a reliable exchange service:
-make sure it has an operating history of at least one year
-a good reputation - there is feedback about this exchange service on the internet
-it is automatic or semiautomatic and offers a good exchange speed
-the service offers a wide selection of trading pairs
-it has enough reserves
-the service operates 24/7
-online support is provided -and last but not least, authenticity and security, make sure the exchange service is secure
Good luck in trading!