If you’d like to trade or invest in cryptocurrency, opening an account with a crypto exchange is a simple way to get started. Cryptocurrency exchanges are platforms that allow you to buy, sell, and trade cryptocurrency. But as the crypto market grows, more and more exchanges are becoming available, and each exchange varies slightly in terms of security, fees, features, and offerings.
Given the many options available, determining which exchange is right for you can be a difficult task. To make the process simpler, we reviewed and rated 28 popular crypto exchanges using criteria relevant to prospective customers. This guide explains our evaluation process.
Investing in cryptocurrencies, Decentralized Finance (DeFi), and other Initial Coin Offerings (ICOs) is highly risky and speculative, and the markets can be extremely volatile. Consult with a qualified professional before making any financial decisions. This article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies nor can the accuracy or timeliness of the information be guaranteed.
Our Rating Process
To objectively evaluate each exchange, we collected data on and compared 28 companies across the following categories:
- Mobile App
Within each category, we considered several factors, such as the number of spot currencies and order types supported, total countries where the exchange is available, trading fees, and more. We scored each factor on a 0-to-1 scale (or as a zero or one, depending on the factor), with zero being the worst possible score and one being the highest possible score.
We then assigned a percentage weighting to those scores and established an overall 1-to-5-star rating for each exchange. One star is the lowest possible rating, and five stars is the highest.
Data collection was a key part of our evaluation process. We gathered data from company websites and media contacts to ensure we had the most accurate information possible to rate each crypto exchange objectively. Our research team collected over 1000 data points and weighted more than 20 criteria to determine company ratings.
For those interested in crypto trading and investing, security is an essential factor to consider when choosing an exchange. With this in mind, we evaluated several factors related to security, assigning a zero or one score to each and a percentage weighting according to importance:
- Cold storage (10%)
- Know-Your-Customer (KYC) standards (2%)
- FDIC insurance (4%)
Cold vs. Hot Wallets
We also considered whether the crypto exchanges we evaluated offered hot or cold wallets or a combination of both. Hot wallets are internet-connected, while cold wallets are not. In general, cold wallets are considered more secure, but it’s easier to buy and trade cryptocurrency using a hot wallet.
Exchanges offering cold wallets or a combination of hot and cold wallets received a score of one, while those offering no storage received a score of zero. These scores make up 10% of our overall star ratings.
Know-Your-Customer, or KYC, standards were developed to help minimize instances of fraud and money laundering on financial platforms. Crypto exchanges that follow KYC standards require that users verify their identities. Typically, this involves sharing some personal information or providing a copy of a government-issued photo ID, such as a passport or driver’s license.
Exchanges following KYC standards received a score of one in our evaluation, while those not following KYC standards received a score of zero. These scores account for 2% of our overall star ratings.
While cryptocurrency is not FDIC-insured, some crypto exchanges offer FDIC insurance for U.S. dollar amounts held on their platforms. Generally, this insurance is provided through partner banks.
In our evaluation, crypto exchanges offering FDIC insurance through partner banks received a score of one, while those that didn’t offer it received a score of zero. These scores make up 4% of our overall star ratings.
Fees can vary widely depending on which cryptocurrency exchange you’re using. Given that this is an important consideration for crypto traders and investors, we compared various fees across exchanges.
We graded each exchange’s fees on a 0-to-1 scale, with exchanges that offer lower fees receiving scores closer to 1. Scores were then weighted as follows, for a total of 45% of the overall star rating:
- Trading fees (20%)
- Deposit fees (10%)
- Withdrawal fees (15%)
In our assessment of trading fees, we considered maker fees, taker fees, and derivatives trading fees. We compared fees across each exchange and assigned a 0-to-1 score for each fee type. These scores were then used to calculate an overall trading fee score, which accounts for 20% of our total star rating for each company.
We also looked at both crypto and fiat deposit fees for each exchange, and companies that offered no fees or lower fees received higher scores on our 0-to-1 scale. We then assigned an overall deposit fee score, which makes up 10% of each company’s star rating.
Crypto exchanges also charge withdrawal fees in certain cases. During our evaluation, we looked at each company’s crypto and fiat withdrawal fees and assigned a 0-to-1 score for each. We then used the crypto and fiat withdrawal fee scores to develop an overall score. This score accounts for 15% of each company’s total star rating.
In our evaluation of each exchange, we also considered its offerings such as how many cryptocurrencies are supported. We collected data on the following criteria and assigned a percentage weighting based on importance:
- Crypto assets (3%)
- Derivatives (1%)
- Order types (1.5%)
- Over-the-counter (OTC) trading (2%)
- Third-party trading bots (0.5%)
Certain exchanges offer more supported cryptocurrencies than others. Those that offered a higher number of supported assets scored higher on our 0-to-1 scale, while those that offered a limited number of assets scored lower. These scores accounted for 3% of each company’s total star rating.
Derivatives are a type of contract between a buyer and seller, and the value of the contract is tied to an underlying asset. In the case of crypto, a derivatives contract’s value aligns with the value of an underlying coin or token. There are several types of derivatives contracts that can be used for different purposes. For instance, traders may use a futures contract to speculate on the future price of an asset, and the contract could stipulate certain buy and sell commitments.
In our evaluation process, we considered whether each crypto exchange offered derivatives, as well as the types they offer. We scored each company on a 0-to-1 scale based on the number of derivatives it offers. Exchanges with several derivatives options received higher scores. These scores make up 1% of our total company star ratings.
Different cryptocurrency exchanges may offer different order types. For instance, some may offer limit orders, which allow you to specify a maximum price for which you’ll purchase an asset or a minimum price for which you’ll sell an asset. Others may not offer this order type.
We collected data on the different order types each exchange offers and then used this data to score each company on a 0-to-1 scale. Exchanges with a larger number of order types received a higher score than those with a smaller number. These scores accounted for 1.5% of a company’s overall star rating.
If a cryptocurrency exchange supports OTC trading, it allows two parties to conduct transactions directly instead of through the exchange. OTC trading is often used by those who want to buy or sell a large amount of cryptocurrency. Some exchanges offer this option for institutional traders or high-net-worth individuals looking to make large transactions.
We collected data on whether or not each crypto exchange we evaluated supports OTC trading. Exchanges that support this option received a score of one, while those that did not received a score of zero. These scores make up 2% of a company’s overall star rating.
Third-Party Trading Bot
We also considered whether or not exchanges we evaluated support third-party trading bots. These trading bots, which allow users to customize their trading experience, can integrate with an exchange’s API. They may offer added value to high-volume users or those looking to automate their trades.
Exchanges that support third-party trading bots received a score of one in our evaluation, while those that do not received a score of zero. These scores make up 0.5% of our total star ratings for each company.
During our evaluation process, we also considered the availability of each crypto exchange on our list. We looked at the following factors in this category and scored each exchange on a 0-to-1 scale based on its availability. Then we assigned a percentage weighting to each and used those percentages to calculate our overall star ratings.
- Countries available (1.5%)
- Funding methods (2%)
Due to regulatory factors, crypto exchanges generally aren’t accessible in every country. For instance, Bitfinex is not accessible in the United States. Exchanges that were available in more countries received a higher score in our evaluation, and these scores accounted for 1.5% of our overall star ratings for each company.
To assess availability from a funding perspective, we also considered which funding methods each company offers. We considered three different funding methods in this category, including funding via online service, ACH transfer, and wire transfer. We then came up with an overall fiat funding score, and these scores account for 2% of our overall star ratings for each company.
As you’re comparing crypto exchanges, you want to ensure that each exchange has the features you want. For instance, you might be interested in applying for a credit card that earns crypto rewards or earning interest on your crypto. Some exchanges may offer these features while others may not.
In our evaluation of features, we considered the following criteria, scored each on a 0-to-1 scale, and assigned percentage weightings based on importance:
- Financial features (5%)
- Customer support (8%)
- Other rewards (3%)
Certain exchanges offer valuable products and features like co-branded credit cards that allow you to earn crypto rewards for your day-to-day spending, the ability to earn interest on crypto, and the option to take out a loan against your crypto holdings. We considered if exchanges offered these products and features in our evaluation, and this factor accounted for 5% of each company’s total star rating.
Since many crypto exchanges are relatively new, they may not offer many options for customer support. But as a customer, being able to access customer support is essential if you encounter problems or have questions about your account. Given this, we collected data on customer support options and scored each exchange on a 0-to-1 scale based on the number of options available. Customer support scores make up 8% of our overall company star ratings.
Certain exchanges offer rewards for specific actions, like referring a friend or maintaining a high balance of a specific asset. Rewards may come in a few forms, including bonus earnings or discounted fees. We assigned a 0-to-1 score to each exchange based on the number of rewards it offered. Other rewards scores accounted for 3% of our overall company star ratings.
We also considered whether each crypto exchange we evaluated has a mobile app, as well as mobile app accessibility, ratings, and functionality. We collected data on the following criteria and assigned a percentage weighting based on importance:
- App availability (5%)
- Customer rating (5%)
- Update frequency (0.5%)
- Data privacy (0.5%)
- Compatibility (0.5%)
In our evaluation, we considered if each exchange offered a mobile app available for Android and Apple. We then scored each exchange on a 0-to-1 scale based on mobile app availability. Mobile apps that were available on both operating systems scored higher than those that were only available on one. These scores accounted for 5% of our overall company star ratings.
In addition to app availability, we also considered how mobile users rated each app on Google Play. We then assigned a score of 0-1 based on customer ratings. Apps that received high ratings from customers in Google Play scored closer to 1, while apps that did not received lower scores. We then came up with an overall score for this category, which accounted for 5% of our overall company star ratings.
As part of our evaluation, we also considered how frequently each crypto exchange's mobile app was updated. We then assigned each exchange's mobile app an update score of 0-1. Mobile apps that were updated more frequently received higher scores. These scores accounted for 0.5% of our overall company star ratings.
We looked at data privacy as we were evaluating each company's mobile app. We considered factors like data points linked to the user and if the mobile app tracked user data, and used this information to come up with a 0-1 score for each exchange. These scores accounted for 0.5% of our overall company star ratings.
In addition to app accessibility across operating systems, we also considered compatibility with different Apple devices, including iPhone, iPad, iPod Touch, Apple Watch, and Mac. Exchanges with mobile apps that were compatible with more devices scored closer to 1, while those compatible with fewer devices scored closer to 0. These scores made up 0.5% of our overall company star ratings.
Choosing the Right Cryptocurrency Exchange for You
For those interested in trading or investing in crypto, choosing the right exchange is important. But several factors will likely influence your decision.
Using publicly available information, we evaluated several top cryptocurrency exchanges and rated them based on factors of importance to prospective customers. As part of our evaluation process, we considered security features, fees, offerings, availability, and other factors. While we strived to be as objective as possible in our ratings and reviews of each crypto exchange we evaluated, determining which exchange is right for you will depend on your individual needs and preferences.
Jessica is an Associate Finance Editor on the Performance Marketing team at Investopedia and The Balance. She's been editing financial and business content for over a decade.
Prior to joining the Performance Marketing team, Jess was an editor at FinanceBuzz where she helped build out the site’s investing, cryptocurrency, credit card, and insurance verticals. She also spent nearly five years in an editorial role at a blockchain media agency where she worked on content campaigns for brands like State Street Global Advisors and Mint.
Hannah has been conducting research for over a decade, with a recent focus on providing data-driven recommendations from synthesizing quantitative data with qualitative data on services and products across finance, health, and lifestyle.
Prior to joining the Performance Marketing team as a Research Associate, Hannah conducted research for Fortune 500 companies and multinational biotech companies including Pfizer, Johnson & Johnson, and Takeda. Her experience leading rigorous studies for FDA reviews shaped her standard of research integrity which guides her work at Performance Marketing.