With the surge in the popularity of cryptocurrencies over the past few years, there has been an explosion of different cryptocurrency exchanges to choose from. But with so many options available, it can be difficult to know which is the safest crypto exchange to date.
Ever since FTX, one of the biggest crypto exchanges in the world crashed earlier this year, there have been increased concerns about the safety and reliability of crypto exchanges. Investors saved millions and billions worth of assets inside FTX due to its promised security, only to see its downfall in a matter of days. As a result, many investors are looking for alternatives that can provide a more secure and trustworthy trading experience.
Fortunately, several different crypto exchanges have emerged as top contenders in terms of safety and reliability. Let’s dig deeper into the safest crypto exchanges, their advantages, disadvantages, and long-term outlook which would prevent the occurrence of an FTX-like tragedy.
A crypto exchange is a platform where users can buy, sell, and trade cryptocurrencies like Bitcoin, Ethereum, Litecoin, and many others. There are two main types of crypto exchanges: centralized and decentralized. Centralized exchanges use a centralized server to manage order books and transactions between buyers and sellers. Decentralized exchanges operate on smart contract technology that connects buyers and sellers directly without the need for an intermediary party.
As stated in a blog in Algory titled ‘CEXs Vs DEXs – Which One to Choose?’, “Since most CEXs offer custodial wallets, they own the private keys of the assets. The problem here is that in case the exchange gets hacked, the hacker can steal the users’ assets. This isn’t an issue for DEXs’ users because they own the private keys of their wallets.”
Crypto fans find it annoying to use centralized exchanges since these run contrary to the decentralized ethos of cryptocurrency. To make matters worse, the company or organization behind them may enforce Know Your Customer (KYC) requirements which means that each user must reveal their identity to prevent illicit activities like money laundering and fraud – just as one would do when applying for a bank account.
In contrast, decentralized exchanges present particular challenges for users. The user experience is not ideal from a technical standpoint and oftentimes doesn’t allow you to convert USD into cryptocurrency directly. This means that to buy or trade crypto on these types of platforms, you need an account with another exchange first where you can purchase the desired asset and then move it over to the DEX of your choice.
Additionally, you will likely be participating in peer-to-peer transactions. This implies that it may take more time to find a user interested in buying what you have for sale; if the liquidity of your crypto asset is low, it could require accepting price discounts just to sell or buy a low-volume digital currency rapidly.
Some of the safest crypto exchanges today include centralized platforms like Binance, Coinbase, Kraken, and Huobi, as well as decentralized options like Uniswap, Pancakeswap, IDEX, and Kyber Network. These exchanges are known for their robust security features, advanced trading tools and software, and intuitive user interfaces.
Each exchange offers different features, levels of security and reliability, and trading experience. Let’s take a closer look at these top contenders for the title of safest crypto exchange.
When it comes to choosing a crypto exchange, there are several factors to consider. Some of the key considerations include trading volume, liquidity, security features, user-friendliness, and transaction fees.
If you’re looking for the safest crypto exchange available today, you can’t go wrong with Binance or Coinbase. Both exchanges have built up a solid reputation as reliable and secure platforms that prioritize their users’ safety and security above all else. They also offer high levels of liquidity and low transaction fees compared to other alternatives in the space.
But obviously, there are more and more exchanges that will eventually catch up or even take over the throne as the “Safest crypto exchange”. This is possible because of the constant innovation of crypto technology and safety authentication processes.
Let’s rank them up below.
The following are the top centralized cryptocurrency exchanges, according to traffic, safety, liquidity, and trading volumes.
As one of the globe’s most advanced trading platforms, Binance supports over 200 coins for deposits and withdrawals. Every experienced trader and novice interested in crypto trading will find it beneficial to use this platform because of its highly competitive rates that offer unbeatable comfortability. With an international customer base providing rave reviews about their experience with crypto-trading on Binance, you can be sure you’ll have a great time too.
Recently, Binance has joined forces with external companies such as Simplex to grant users the ability to purchase cryptocurrencies through wire transfer and credit card payments at a premium rate. Additionally, individuals living in the United States are now able to trade via Binance-US since it adheres to American trading regulations.
To protect itself against cyberattacks, Binance has established a few security measures; one of them being cold wallets. The Mt. Gox hack serves as a reminder that exchanges must store most of their crypto off the internet to keep it safe from hackers. True to this advice, Binance proudly declares that they store “the vast majority” of their crypto in offline storage systems known as cold wallets – making sure these coins stay out of harm’s way.
Binance offers two-factor authentication (2FA). If you activate this option, whenever logging into your account or making a deposit and withdrawal transaction, you will be asked to enter the code sent from either SMS text messages or the authenticator app. As an even better measure of protection than using only mobile applications, Binance also provides users with an additional choice – a Yubikey hardware device.
Binance actively monitors all transactions across the platform, and with its algorithm, can detect any suspicious activity. If this occurs, a 24-to-48-hour freeze is quickly implemented to protect your account from potential hackers. And if you are the one who authorized it? No problem! You could just wait for the period to end or opt for contacting customer service instead to lift the restriction promptly. But more importantly, these couple of days will serve as an ample warning should someone else have accessed your data without permission— giving you valuable time to alert Binance staff accordingly.
Binance is still crowned as one of the safest crypto exchanges to date, with additional features such as:
- Access control. For ultimate security, Binance grants you the power of “access control” that limits your withdrawals to certain IP addresses or wallet addresses.
- Organizational Security. Binance employs sophisticated safety protocols to protect its crypto assets, such as Threshold Signature Schemes (TSS)2 which mandate multiple persons sign off on any wallet-to-wallet transfers.
- Security notifications. Binance is constantly vigilant, proactively monitoring your account for any fraudulent activity. In the event of suspicious behavior being detected, you will be immediately notified via email.
- Data encryption. Personal information such as Social Security numbers and addresses are securely kept in encrypted form, making it virtually impossible for malicious hackers to obtain it.
- Secure Asset Fund for Users (SAFU). Binance has allocated a billion-dollar fund to ensure customers are reimbursed in the event of a major security breach. This unparalleled reserve serves as an assurance that, no matter what happens, Binance will be able to fulfill its monetary obligations and remain solvent for years to come.
Coinbase is a reputable and reliable cryptocurrency exchange, established in 2012 in the U.S., with its stocks now listed on Nasdaq under “COIN”. Boasting an astounding 56 million users throughout more than 100 countries worldwide, Coinbase assures those questioning whether it’s safe to trade there.
Both beginners and experienced traders can trust this crypto exchange, as it has successfully traded over a staggering $150 billion of digital assets. Even more noteworthy is the fact that the company is now publicly-traded on Nasdaq – an indication of its credibility and reliability among users. However, some customers have complained about issues with customer support services.
Coinbase stands apart from other exchanges by offering superior security measures that safeguard user funds. Their commitment to safety is why they are preferred amongst institutions and cryptocurrency traders despite their higher cost of use. Through robust security protocols, Coinbase ensures protection against theft and hacking as well as gives users peace of mind during eventualities.
For ultimate assurance that your crypto funds and accounts are secure, utilize 2-factor authentication with phone and email – in addition to biometric fingerprint logins or passwords. To take the safety of your wealth one step further, connecting it to a hardware storage device is strongly encouraged for full control over it.
Coinbase is globally renowned as one of the most secure and highly trusted cryptocurrency exchanges, holding nearly 99% of its users’ digital assets in offline cold storage. With Coinbase’s mandatory two-factor authentication (2FA) on your account and additional security measures such as validating a phone number through text message code entry, you can be confident that your financial information remains safe.
Plus, since it is a publicly-traded company, extra financial and security examinations have been conducted to certify this status – making Coinbase an even more reliable choice for exchanging cryptocurrencies.
When you’ve decided to delete your Coinbase account, the platform makes it easy for you to request access and copies of all personal data that they have received from you.
Furthermore, if requested, Coinbase will permanently remove this information from their servers – an impressive feature that demonstrates their commitment to providing responsible treatment and efficient discarding of users’ private details.
Trading cryptocurrencies is a daunting task, which is why Kraken’s platform was launched only two years after Bitcoin (BTC) to offer users top-notch security and more than 120 coins from the U.S. to choose from. Not only that, but their affordable prices also allow you to stake and earn rewards with your crypto – making it one of the most reliable exchanges on the market today.
Cryptocurrencies have become recurrently exposed to hacks, leading to millions of dollars in lost coins. Luckily, most hacked exchanges have covered their customers for any monetary losses – but you don’t want to be caught unaware at a low-security crypto exchange that could leave your coins vulnerable and unprotected.
At Kraken, security is the top priority. Commitment to safety has earned third place on our list. In fact, Kraken has gone unscathed by major hacking events since its launch. While some users have reported compromised individual accounts on online forums, these are isolated incidents that do not reflect a systemic issue with Kraken’s security protocols and measures.
Kraken offers unparalleled digital asset protection, with 95% of deposits stored in heavily guarded offline cold storage units located at different locations across the globe. Their servers are locked away securely and monitored via 24/7 armed guards and surveillance cameras to ensure maximum security.
Kraken employs robust physical security measures and encrypts all of your sensitive contact information at both the system and data levels. To ensure further protection, Kraken conducts regular vulnerability testing on its own systems. With its top-of-the-line security, Kraken has been awarded the CSO50 award for its security initiatives.
Gemini Trust Company LLC is a cryptocurrency exchange with over 100 crypto-assets to purchase, sell, and trade. Aside from its breadth of choices in the world of digital currency, Gemini provides users with powerful account security measures and compliance controls.
The platform also grants access to an array of products and services such as rewards credit cards powered by cryptocurrencies, the ability to generate interest on holdings placed within their accounts, hot wallets prebuilt into their system for quick transactions or storage needs — even allowing consumers the option to pay retailers directly through blockchain technology!
Whether you’re a novice or an experienced trader, Gemini’s user-friendly website and mobile app offer something for everyone. The Gemini trading platform offers a simple buy/sell option, coupled with its comprehensive support page for beginners to build their confidence in the market.
For those who are more advanced traders, ActiveTrader provides access to sophisticated charting tools and multiple order types so users can efficiently execute trades at lightning speed.
Gemini is also a safe crypto exchange because of its extra layer of security. With Gemini’s identity verification process. All you need to do is simply upload a valid government-issued photo ID, such as a driver’s license or passport, which would allow you to take advantage of the platform’s full features.
Gemini provides a secure user experience with two-factor authentication, wallet address whitelisting, and the option to approve logged-in devices. To take advantage of its entire spectrum of trading possibilities, users must complete Know Your Client (KYC) verification which requires them to upload an approved government ID picture. This extra step serves as an additional layer of protection against fraud on Gemini’s platform.
Gemini is SOC 2-certified and has recently been recognized for its commitment to security and compliance. On top of that, the platform offers FDIC insurance for U.S. dollar deposits up to $250,000 as well as digital asset insurance for funds held in its hot wallet – making this one of the safest crypto exchanges out there. This insurance policy safeguards user funds against any possible security breaches or cyber-attacks.
Now that we have covered the Centralized exchanges rankings, let’s move on to the decentralized portion of web3.
Below are the highest-ranked decentralized cryptocurrency exchanges, according to traffic, safety, liquidity, and trading volumes:
Uniswap is a revolutionary blockchain-based trading protocol that enables users to swap tokens without the need for central authorization.
Unlike its traditional order book model counterparts, Uniswap pools Ethereum tokens into smart contracts so users can exchange them against these liquidity pools. Everyone has access to trade ETH or ERC20 tokens on Uniswap and lend their digital currencies with confidence in liquidity pools for earning fees – plus listing new token pairs is possible as well.
In other words, it’s an all-inclusive on-chain digital market maker allowing instant swaps between Ethereum & ERC20s.
With more than 6000 digital currencies currently being exchanged around the world, many of them built on Ethereum’s blockchain technology, Uniswap was created to further optimize tokenized assets running via this network. This protocol is revolutionizing how individuals can access and utilize cryptocurrency securely.
Uniswap Exchange is incredibly secure, as it operates remotely and without a central server. Built on Ethereum’s trusted blockchain, you can rest assured that your funds are protected by the network itself.
All of your money sent to liquidity pools will be locked in smart contracts which cannot be hacked or accessed by anyone other than yourself – making hacking nearly impossible even if someone did manage to get ahold of all individual account information.
While using Uniswap Exchange, you may only experience issues related to human error as the code and smart contracts have been inspected rigorously and experimented with securely.
Overall, your crypto is strongly protected on Uniswap. The blockchain technology guarantees that all of your transactions are secure and safe, plus you will retain guardianship over any tokens purchased even when used for liquidity purposes.
Still, there’s a risk of obtaining counterfeit or unreliable coins if you’re not mindful of research; this calls for extra caution to keep both your wallet and crypto assets intact. Even though the smart contract exploit carries a minimal-to-nonexistent danger due to V2 and V3 being out without setbacks since long ago, it still pays off to stay vigilant about Uniswap’s security features.
DYdX provides traders with a decentralized exchange (DEX) hosted on Ethereum, where they can securely and conveniently swap over 36 different cryptocurrencies without needing to undergo any Know Your Customer (KYC) identity verification. Furthermore, DYdX is one of the few exchanges that offer perpetual margin trading – this means you only have to fund part of your trade rather than its total value.
With DYdX, you can trade any of the assets on your chosen index without having to take risks with funding. Thanks to its unique margin trading interface, this platform is easy-to-use yet has advanced features that make it stand out from other DEXs out there.
If you’re interested in leveraging your crypto trades anonymously and earning more profits while taking advantage of price drops, DYdX is an ideal option as safe cryptocurrency exchange users look for flexible options.
With dYdX, users don’t have to worry about their funds’ safety since they are locked securely in smart contracts instead of being held on an exchange. Backed by the Ethereum blockchain and its many layers of security, you can rest assured that your assets are safe from malicious actors or cyber-attacks. Your only concern should be executing a successful trade far from loss or liquidation.
Curve Finance is an Ethereum-based decentralized exchange (DEX), made specifically to facilitate the trading of numerous stablecoins. All you need are your funds, plus a compatible Ethereum wallet and you can swap different stablecoins with minimal fees and slippage!
Consider Curve to be the “Uniswap for stablecoins”. Its exclusive pricing criteria also make it a great choice when trading between tokenized forms of an asset.
Curve distinguishes itself from other AMM platforms such as Uniswap and Balancer by only allowing liquidity pools made up of similarly behaving assets like stablecoins or wrapped versions of those same assets, such as wrapped Bitcoin (wBTC). As a result, Curve can operate more efficiently than its rivals with the lowest fees, slippage, and impermanent loss rates of any DEX on Ethereum.
In terms of safety and security, Curve is built on the same solid blockchain technology that makes all Ethereum-based assets virtually impervious to hacking or manipulation. With its advanced smart contract architecture and strict identity verification requirements, you can confidently trade stablecoins knowing that your funds are protected through the wonders of blockchain technology.
PancakeSwap (V2) is the go-to decentralized exchange for BEP-20 token swaps on the BNB Chain, offering users an extensive market share. Integrating an automated market maker (AMM) model, traders can swap tokens against a liquidity pool with ease. Plus, by becoming a liquidity provider you can receive LP tokens that entitle individuals to a portion of the platform’s transaction fees! It’s no wonder why PancakeSwap has become one of the leading DEXs in its ecosystem.
PancakeSwap features open and transparent built-in security and verification features that replace the need for long KYC procedures. PancakeSwap is open-source meaning it can be accessed by anyone anywhere in the world. The exchange currently has more than $600 billion in liquidity.
PancakeSwap has taken extra steps to ensure the security and transparency of its users’ assets by undergoing a comprehensive audit by cyber-security firm CertiK. By doing so, our users can be assured that they are using a reliable exchange platform.
To reinforce these efforts even further, PancakeSwap has integrated various top-notch security measures such as Security Oracle, CertiK Shield, DeepSEA, and the Virtual Machine developed by CertiK into its own system which will provide unparalleled protection for all transactions conducted on our platform.
When choosing an exchange, it’s crucial to carefully research all available options to identify the one that best meets your investment confidence. Factors like platform security and user-friendly features are essential when evaluating an exchange’s suitability.
Additionally, you should consider the size and liquidity of an exchange before deciding on a particular one, as this can have significant implications for safety and legitimacy.
Some of the key factors to consider when choosing an exchange include platform security, user-friendly features, and liquidity. When evaluating these factors, it is important to look at an exchange’s reputation for reliability and customer support, as well as its fees and trading volume.
Another important consideration is whether the exchange uses a decentralized architecture or a centralized one, as this can have significant implications for your privacy and security.
When it comes to platform security, it is essential to choose an exchange that has a proven track record of protecting customer funds from malicious actors or cyber-attacks. This may be accomplished through robust vetting procedures for users or by utilizing advanced security protocols such as multi-signature technology and cold storage.
If you want to quickly access useful crypto information, then Algory is the best solution for crypto enthusiasts, traders, and investors. With its multifunctional and actionable set of cryptocurrency tools combined with its news aggregator, it makes tedious research a thing of the past. Discover what sets Algory apart and make your trading easier than ever before – all jam-packed in one product.
These are the safest crypto exchanges that you can use to start trading. Safeguarding your investments and funds is of paramount importance when trading, so make sure to keep these key points in mind when selecting an exchange. As the sector continues to expand, it is important to stay up-to-date with developments that could directly impact your investment decisions.
Further research and due diligence into an exchange’s reputation, customer support, and fees will help ensure a smooth trading experience. Ultimately, the exchange you choose should provide the features and security measures that best meet your needs as an investor or trader.
Remember that even though you use some of the safest crypto exchanges, never leave your funds on exchanges for an extended period of time and always make sure to safeguard your investments by storing them in a secure wallet. With the right approach and research, you can be sure to find the safest crypto exchange that is perfect for you.
By following these tips and considerations, you will be able to make informed decisions when it comes to choosing the safest crypto exchange for your investment needs.
Disclaimer: None of this should be taken as financial advice, please do your own research before investing in any cryptocurrency. The information provided in this article is for educational purposes only and should not be relied upon as investment advice or a recommendation to buy, sell, or transact with any type of asset. The authors of this article do not accept any liability for damages or losses arising from the use of this article. Please consult a qualified financial advisor prior to making any investment decisions.