Cryptocurrency exchanges are platforms that allow users to trade cryptocurrencies for other assets such as digital and fiat currencies. In short, cryptocurrency exchanges serve as a middleman between a buyer and a seller, earning money through commissions and transaction fees. There are two types of exchanges centralized and decentralized. Centralized cryptocurrency exchanges serve as a go-between for a buyer and a seller. These are more reliable because they are operated and controlled by a company.
Decentralized cryptocurrency exchanges (DEX) enable users to conduct peer-to-peer transactions without the involvement of a third party or . Some users prefer decentralized exchanges due to some of the issues associated with centralized exchanges. Along with it, you can check the main benefits of the cryptocurrency exchanges.
The Pros Cryptocurrency Exchanges
1. Simple to use
Centralized exchanges provide novice investors with a familiar and friendly environment for trading and investing in cryptocurrencies. Users of centralized exchanges can log into their accounts, view their account balances, cryptocurrency prices, and make transactions through applications and websites, as opposed to crypto wallets and peer-to-peer transactions, which can be complex.
When it comes to transactions and trading, centralized exchanges provide an extra layer of security and dependability. Centralized exchanges provide greater comfort by facilitating the transaction through a developed, centralized platform.
3. Reducing the risk of hacking
The cryptocurrency exchange users are not required to transfer their assets to a third party. As a result, there is no risk of a company or organization being hacked, and users are protected from hacking and theft. Decentralized exchanges prevent market manipulation by allowing for peer-to-peer cryptocurrency exchange, protecting users from fake trading and wash trading.
4. Market hours for cryptocurrencies
There is no centralized governance of the market, the cryptocurrency market is usually open for trading 24 hours a day, seven days a week. Cryptocurrency transactions occur directly between individuals on cryptocurrency exchanges around the world. However, there may be downtime while the market adjusts to infrastructural updates.
5. Extensive exposure
The CFD trading is a leveraged product; you can open a position a deposit that is only a fraction of the total value of the trade. In other words, you could gain significant exposure to the cryptocurrency market while only committing a small portion of your capital. The profit or loss from your cryptocurrency trades will reflect the full value of the position at the time it is closed, so trading on margin allows you to make large profits.
6. Account opening in less time
When purchasing cryptocurrencies, you must do so through an exchange, which necessitates the creation of an exchange account and the storage of the cryptocurrency in your own digital wallet. This procedure can be cumbersome and time-consuming.
However, when you trade cryptocurrency with IG, you do not need direct access to the exchange because these are exposed to the underlying market on your behalf. You do not have to set up and manage an exchange account, so you could be up and running and ready to trade much faster. With our simple application form and instant online verification, you could be trading in less than five minutes.