Getting started with Coinmama is super simple. They offer newbie-friendly, step-by-step instructions to make your first purchase. They have a great support team. They are also very highly recommended by many people online.
If you start to accumulate a lot of coins, I highly recommend setting up a cold storage wallet to keep your coins secure.
GDAX / Coinbase
(2018 UPDATE: I no longer recommend Coinbase. They were great for awhile, but so many better ways to purchase coins are available, such as Coinmama.)
GDAX is a sister company of Coinbase, which is one of the most used exchanges online. It serves as a sort of day-trading platform whereas Coinbase is better for buying coins and keeping them for awhile. It’s important to note that GDAX has zero fees to transfer coins, which is quite astonishing because the Bitcoin transfer fees these days are abysmal! You can place buy/sells on the marketplace as well as limit orders which trigger when certain conditions are met. They even offer stop orders which are like limit orders but with an extra condition. GDAX requires a bit more identity verification than other exchanges due to its legitimate nature, but it’s also one of the older exchanges. GDAX is the number one exchange for people just getting into cryptocurrency and want to buy through Coinbase and send to GDAX.
It’s important to know that when you sign up for Coinbase, you’re automatically created a GDAX account, which is why I am including these two exchanges together.
This is among the top 3 most used Bitcoin and cryptocurrency exchanges. They are also among the newest exchanges, boasting the best in trading technology. Their exchange fees range from 0.15-0.25% depending if you are purchasing at market rate or limit rate (explained below).
Maker (limit) trades. A maker trade is when you place an order that is opposite of where the price graph is heading. For example, if the price is going higher then you would be a maker if you placed a buy order lower than the asking price. You’re taking a stance and saying, “I think the price will decrease, and I want to purchase coins if it decreases.” Likewise, you are a maker if you place a sell order when the price is decreasing, but your order must be higher than the asking price. You’re saying, “The price is dropping, but I think it will go up, and when it does I want to sell my coins.”
Taker (market). A market or “taker” order is when you agree with where the price is heading. Let’s say you have a stash of Bitcoin and the price starts dropping. Because you want to sell at a higher price than you think it will be in the upcoming minutes/hours, you dump your coins at market rate. Many times (as is the case with Gemini and Coinbase) you pay an extra fee for placing a market order. It’s important to note that your purchase or sale has no affect on the price of the coin. This is why it is called a taker order — you are agreeing with the prices, not competing against them.
These two aspects of maker (limit) and taker (market) are VERY important to know when approaching a cryptocurrency exchange for the very first time. So make sure to remember them!
Interesting to note, Gemini got started in 2015 by the Winklevoss twins (Olympians, Tyler and Cameron). You may remember them from the Facebook story, where they lost their social media platform to Mark Zuckerberg. They’re doing alright for themselves in the world of cryptocurrency as one of the most reputable proponents for digital currency itself. Fun fact: they are estimated to own one-hundreds of the entire supply of Bitcoin. They’re very freaking rich, and they have a passion. This very passion is why Gemini is perhaps the first or second greatest exchange out there!
And finally, Gemini was developed with user experience in mind. It’s a breeze to use and requires very little technical knowledge. As long as you know the difference between maker/taker orders then you’ll have a good time on the Gemini exchange.
Quite a few new exchanges are hitting western United States lately! Bittrex is of course one of them. They are among the largest exchanges with the highest transaction volumes. They have many Bitcoin “pairings”. This means that you can buy and sell coins to and from Bitcoin, but you cannot buy and sell AltCoins (coins that are not Bitcoin) with each other. Therefore when you have, for example, a bunch of Dogecoin and you want to turn them into Ethereum, you’ll have to make an additional transactions (from Dogecoin into Bitcoin into Ethereum). This is very common with exchanges, and you should get comfortable doing this. As you should know, most/all exchanges gauge value in comparison to Bitcoin itself. And you may find that a value of a coin is measured in Satoshi (units of a Bitcoin equivalent to 0.00000001) rather than US Dollars, British Pounds, or Euros. It’s important to get used to measuring a coin’s value in Satoshi!
Due to massive volume, Bittrex has had quite a few questionable reviews from users having difficulties depositing and withdrawing funds. This is to be expected as the world of cryptocurrency increases as well as the number of users. From website visitors and friends, Bittrex has been overall a very pleasant exchange to work with. It’s absolutely necessary to expect some minor setbacks when transacting; and compared to others, Bittrex has fewer of these setbacks.
The CEX.io exchange is known for their low exchange fees, a mere 0.20% compared to the 0.25%+ of other exchanges. It has a very beginner-friendly interface to ensure that you’re able to get up and running exchanging cryptocurrencies in no time at all.
Certain countries are not allowed on the platform. You can browse their website to view restricted countries. However they are allowing new countries to trade very frequently. This makes CEX.io a very potent up and coming Bitcoin exchange.
Like Coinbase, CEX.io allows for credit card and bank account transfers. Keep in mind that their credit card transfers can take up to 1-2 days to process, compared to Coinbase’s instant transfer time. Their bank transfer speed varies greatly, therefore you cannot expect your coins to be available by a certain date.
If you want to sell bitcoins on an exchange then keep in mind their 2.9% fee as well as a flat fee (which varies depending on what currency you are selling for). There are better methods to sell Bitcoins than on an exchange like this. Consider using Local Bitcoins to find a reputable buyer or seller near you.
Kraken boasts a more traditional exchange interface. By that, I mean it’s quite a bit complicated to use for newer traders, but it boasts a plethora of features for those familiar with cryptocurrency trading. Their fees start out from 0.16-0.26% but they have a program that reduces these fees the more you trade (which not many other exchanges offer). It supports a larger variety of countries than most other platforms.
Kraken is located in California’s bay area and released in 2011. It allows for bank transfers as well as cryptocurrency deposits. It has over 15 compatible cryptocurrencies (as of writing) to allow for a diverse trading experience depending on what digital coins suit your fancy. It has solid security and 2-Factor Authentication (2FA) so you can rest assured you’re not subject to a security breach in the foreseeable future. They have a technical support team, though some users report not receiving feedback in a timely manner (or at all). This may be attributed due to the volume of users flooding to the platform as a result of recent negative press on Coinbase.
Of course, no exchange is without negative reviews. There have been quite a few people who did not have an ideal experience on Kraken. I’m not sure if it’s because these people really did have issues or if they weren’t familiar with the trading interface. Quick day traders may not appreciate the slower withdrawal times (which, due to Bitcoin network congestion, is unfortunately commonplace). And in rare cases, users have a hard time accessing their coins on this exchange. You can sign up for an account, but don’t do any heavy trading until you explore the platform.
Poloniex is quite the controversial exchange with mixed reviews. While on paper it boasts solid technology and features, it has quite a few negative reviews from its users. These include delayed withdrawal times, slow transaction times, issues with booking orders, frequent outages, faulty API, slow ticket response times, lost coins, and more. At the time, I cannot recommend them even though I have not use them. This news is in response to reviews from my friends and readers of this website. There are too many faults in their platform to recommend. That’s no worry, however, because there are many other exchanges to use!