Top 10 Cryptocurrency Broker 2021

Would it be better to choose a broker or exchange platform to invest in cryptocurrencies? And, if so, what would be the best brokers and exchanges for it?

The commissions of brokers and cryptocurrency exchanges reduce the profitability of the trader. However, it is not the only factor to assess to choose and should not be exclusive. There are several elements that need to be weighed, such as available assets, trading platform, security of funds, etc.

 

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For this reason, in this article we will look at the differences, advantages and disadvantages of each of these two mechanisms. Similarly, we will conduct an analysis of the best brokers and exchanges existing to invest in cryptocurrencies.

Choose a broker or exchange to invest in cryptocurrencies?
Everything is born from a basic question, does our operation require leverage or is it more oriented to the strategy of buying and holding?

In case of a response in favor of leverage, the most natural thing is that the trader decides to contract with a broker of CFDs on cryptocurrencies. Although there are other mechanisms to invest in cryptocurrencies (such as financial futures on Bitcoin and Ethereum), CFDs have the advantage that they do not expire and are more flexible when choosing the size of the position.

Looking to invest in cryptocurrencies? Check out our recommendations:

  • COINBASE: Secure storage
  • XTB: Allows you to invest in 25 different cryptos
  • ETORO Minimum deposit 200€
  • BITPANDA One of the largest European exchanges

What are cryptocurrency exchanges?

On the other hand, if what you want is to invest in cryptocurrencies without using leverage, one of the best ways to do it is by physical purchase (even if these assets are virtual).

For this there are cryptocurrency exchanges: they are platforms where they are bought and sold through the existing supply and demand. They establish the market price that serves as the basis for launching CFDs and other financial derivatives on cryptocurrencies (the value is established based on the free market).

An exchange, strictly speaking, is a place of buying and selling cryptocurrencies; the rest are parallel services that the platform can offer. In short, they are virtual spaces that allow access to the market. As time has passed (more than a decade ago Bitcoin, the first cryptocurrency, appeared) these trading platforms have evolved in security and services.

When buying cryptocurrencies in cash, that is, physically, it is necessary to have a place to store them. In this case, the user must have a wallet or wallet.

Exchanges for investing in cryptocurrencies usually offer this service, even the exchange of cryptocurrencies (i.e. exchanging one cryptocurrency for another, not buying or selling it using traditional money).

We have mentioned the quality and services of these platforms for a reason. By having the cryptocurrencies stored, they can be stolen by a computer attack on the wallet. There have been some cases. In any case, today exchanges have enough quality and technology to protect the portfolios of their customers.

Investing in cryptocurrencies in cash, through exchanges has a number of advantages, such as the lower risk of price fluctuation and a greater amount of financial assets available to trade. An exchange has a much wider cryptocurrency offering.

What are CFDs?

Its name comes from its acronym in English: Contracts For Difference (contracts for differences). And in reality they are contracts in which the price differences that may exist on a certain financial instrument (in this case the price of a cryptocurrency) are settled at two different temporary moments, which coincide with the opening and closing of the operation.

These derivative products allow you to trade both long and short. That is, it is possible to buy a CFD to sell it later and achieve profitability with a rise in the market, because its price evolves the same as the quote (long operation). Or, you also have the possibility of selling the CFD first to buy it back in the future and make a profit with a decrease in prices (short trade or invest in short).

CFDs are leveraged products, which means that you do not need to deposit 100% of the investment. It is possible to open positions only by depositing a percentage of the volume as a guarantee margin.

Financial leverage allows you to multiply profits, but it also represents a risk. It needs to be handled with skill.

It is for this reason that the maximum leverage to trade cryptocurrencies was limited by the European financial authorities (ESMA) to 1:2. That is, a guarantee of 50% of the volume of the position will have to be deposited. This measure only affects cryptocurrency CFD brokers based in Europe.

Actually, the biggest risks of CFDs come from a misuse of leverage and the broker’s lack of security. For this reason, it is essential to hire the services of a cryptocurrency broker that is properly regulated

The costs of brokers and exchanges: spreads and commissions

One aspect to note is that, when investing in cryptocurrencies through CFDs, brokers normally do not apply trading fees; these are set in the form of spreads.

In CFD trading, the broker offers two prices, one to buy and one to sell:

  • Bid: is the price that the broker is willing to pay in case the user wants to sell the CFD. In other words, it’s the selling price.
  • Ask: it is the opposite price, the one that the broker is willing to sell. In case the client wants to buy the CFD, he will have to pay this price.

As you can deduce, the Ask price is always a few points higher than the Bid price. This difference is called a spread and is loaded at the time of opening a position.

A CFD trade involves a buy and sell, no matter the order in which it is made (depending on whether it is a long or short trade). One of them is done to open the position and the opposite to close it. That is, you will always have to assume this spread.

In contrast, exchanges to invest in cryptocurrencies apply commissions. Depending on the volume of trades over a period of 30 days and whether the order is limited or market, the percentage of commission (on the size of the trade) is established.

What are the best brokers and exchanges to invest in cryptocurrencies?

Next, we leave you a list with the best exchanges and brokers to invest in cryptocurrencies, along with a small analysis of each of them, where we tell you their main characteristics.

Best Exchanges to Invest in Cryptocurrencies 2021

 

  • Exchange               Benefits
    Coinbase                Security & Services
    Binance                  Security and wide range of cryptocurrencies
    Kraken                    Security and Beginner Investor Support

Coinbase

Coinbase is defined as a place to buy and sell cryptocurrencies easily and reliably. It is one of the leading platforms, with a total traded volume amounting to more than 400 billion US dollars, more than 43 million registered users and more than 100 countries supported.

It offers secure storage, 98% of customer funds are stored offline. In addition, it has insurance for. This fact, together with its good practices, make this Exchange one of the best to invest in cryptocurrencies.

To start buying and selling cryptocurrencies through Coinbase, you just have to proceed to the registration and opening of an account. This process only takes a few minutes.

Además, Coinbase dispone de una aplicación para teléfonos móviles y permite la programación de compras periódicas.

Binance

It is one of the most popular cryptocurrency exchanges out there. It was the platform that had the largest exchange in the year 2018 (during the boom of Bitcoin and the cryptocurrency market, before the subsequent fall).

Binance offers the possibility to invest in more than 100 cryptocurrencies. It offers quality customer service, available 24 hours a day, 7 days a week.

binance invitacion
Security is also present: its platform is CCSS and works with ISO/ICO 27007:3013 security protocols. The URL you use is secure.

Signing up for Binance is a simple and totally free process. It also has a mobile application

Kraken

Kraken has also been rated as the safest cryptocurrency exchange. There is no doubt that it is one of the best that exist today.

One of its characteristics is the support it provides to the investor in digital assets, whatever their level. It offers guides, resources and has a quality support service.

Kraken’s platform is itself designed so that it can be used by beginner cryptocurrency traders and investors. Which does not exclude the fact that it is optimized to provide service to the most experienced. It also has a mobile application. Kraken
Kraken has also been rated as the safest cryptocurrency exchange. There is no doubt that it is one of the best that exist to day of

One of its main objectives is to safeguard funds and the privacy of clients. To this end, it maintains a comprehensive protection approach: 95% of client funds are offline. Not counting on the constant surveillance of the platform (7 days a week for 24 hours). All confidential information is encrypted and, in addition, there is a team of experts dedicated to testing penetration in any area of the system.

Best Brokers to Invest in Cryptocurrencies 2021

 

XTB

XTB is a financial intermediary of Polish origin. It is one of the leading cryptocurrency brokers and one of the leaders in the sector.

Among other issues, this broker is recommended for its large amount of financial assets of this nature that it has available to invest. With XTB it is possible to invest in up to 25 cryptocurrencies. In addition, it is supervised by the Spanish National Securities Market Commission (CNMV), among other reputable bodies.

The trader can invest in cryptocurrencies using MetaTrader 4 or its powerful xStation platform. XTB also allows trading through mobile devices, thanks to its apps, and has competitive conditions.

These would be other advantages of using XTB as a broker to invest in cryptocurrencies:

  • Possibility to place Stop Loss orders.
  • It has a demo account to do practices in simulated.
  • The funds are deposited in Spanish banks.
  • The client has a dedicated personal manager.
  • Offers daily cryptocurrency news

eToro

eToro also has a wide range of cryptocurrencies, we can count a total of 16. Like Plus500, eToro is also regulated by CySEC.

However, there is a feature that makes this broker different: not only does it allow you to invest in cryptocurrencies, it also has a social trading network.

Through the eToro platform, which is also unique and works 100% online, it is possible to follow and copy the trades of other traders. There are even wallets designed as investment funds where you can invest in cryptocurrencies (Copyportfolios).

It is possible to trade or social trade with cryptocurrencies from anywhere and at any time thanks to its application for mobile devices.

Due to its services, its platform and its wide range of assets, eToro has become one of the best brokers to invest in cryptocurrencies.

 

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