Bitcoin exchanges in 2020 are no longer simple platforms where the only way to generate revenue is by buying low and selling high, but today the cryptocurrency market has expanded to include a diverse range of different activities, tools, and ways to make money.
Are there more than 500 different trading platforms in the cryptocurrency space, the best platforms that see more than $1 billion of daily trade volumes each provide superior services and have grown and adapted with the changing demands of cryptocurrency traders over the years.
The last 3 or 4 years in particular has seen a boom in the increase of Bitcoin trading platforms within the market and many have launched as a result of the huge increase in the number of traders globally, as well as being in response to the highest daily trade volumes seen at any point throughout the life of Bitcoin.
We’re taking a deeper look at the leading Bitcoin exchanges in the market in 2020, starting with a look at what Bitcoin actually is, breaking down what trading platforms are and how they’ve evolved over the past 10 years, before finishing with taking a look at some of the best Bitcoin trading platforms available online in 2020.
Who Created Bitcoin and When?
Bitcoin is not only the oldest cryptocurrency to ever be created, but even today and throughout its life has remained the largest cryptocurrency by total value and the most trusted cryptocurrency in the world.
The first time that anybody heard the term “Bitcoin” used was in the release of the 2009 research paper by an anonymous individual or group known as Satoshi Nakamoto, called the Bitcoin Whitepaper, with a new kind of digital money being described in the paper, along with a revolutionary new technology that would fuel it known as blockchain.
In the Bitcoin Whitepaper, Nakamoto described a new kind of digital currency that would not be controlled by any central organization or group of people and would be decentralized in the way that it managed and distributed the currency.
In the early dark ages of Bitcoin, there were a limited number of people that even knew about it, and of the people that had any knowledge of it, many people suspected that it was just a scam and avoided investing in it, to their long-term regret and detriment.
This is because Bitcoin has turned out to be by far the highest paying investment opportunity of the last decade, and perhaps one of the best investments in the history of humanity with a return on investment over the past 10 years of more than 27,000,000% by investing into Bitcoin when it was first released.
Today, Bitcoin is just one of more than 5000 different cryptocurrencies, but over the years it has maintained its position as the world’s number one cryptocurrency and has remained as the most trusted cryptocurrency in the process, being that it has a long track record of flawless operation and the support of many thousands of developers and entrepreneurs.
Is Bitcoin Just a Way to Make Money?
The obvious initial attraction that people had to get involved with Bitcoin was the ability to generate profit, and it is also the main reason many people even heard about Bitcoin, being that the stories over the years of people making hundreds of percent ROI have been famous and infamous as well.
While today the main function of Bitcoin is as a source of revenue and income for many individuals and businesses around the world, it also provides a range of other functions and today is being used in a diverse range of different ways.
First, Bitcoin provides some distinct advantages against using the banking system or payment processors such as PayPal for sending transactions internationally, with the 3 major aspects of this being that Bitcoin is faster to use, cheaper to use, and more private to use.
Making international transfers using the banking system can take in excess of 3 days, and this has been something that people have accepted for decades, Bitcoin can provide transactions in as little as 15 minutes to anywhere in the world, while other cryptocurrencies can provide transaction times of 15 seconds or less.
As well as this, Bitcoin provides a much cheaper option than using payment processors in particular, but also in using banks, being that PayPal charges 3% as an example, whereas a cryptocurrency exchange in 2020 was able to send a transaction of hundreds of millions of dollars of Bitcoin costing them just $0.69.
Third, and most importantly to a lot of people, is the ability to make private transactions and for people to take control over their financial assets without the need for permission from financial institutions in order to use their networks, and without a permanent record of every transaction being attached to their identity as well.
Why Do People Trust Bitcoin?
Although there have been more than 5000 cryptocurrencies created since Bitcoin, it has remained the most trusted cryptocurrency and the one that is seen as the gold standard of the cryptocurrency market, which many people consider to be the only legitimate cryptocurrency from certain perspectives.
The reason that Bitcoin has grown to be the most trusted cryptocurrency, as well as being the largest, is that it has a longevity of repelling attacks by malicious act as such as hackers, as well as by governments and regulators, and has never been able to be shut down, nor has any user been able to hack a Bitcoin system in order to give themselves free Bitcoin.
As well as this, Bitcoin has a large number of developers that are constantly working on its code and it is the most scrutinized cryptocurrency by academia, security analysts, and other professionals that are constantly looking for exploits and mistakes in the Bitcoin codebase.
Lastly and perhaps most significantly, unlike the other 5000 cryptocurrencies in existence, Bitcoin is being rapidly integrated into much of the mainstream financial sector, and perhaps the only other cryptocurrency which is seeing a similar kind of adoption and mainstream finance is Ethereum, but to a much lesser degree.
Are All Bitcoin Platforms the Same?
While the general setup and design of cryptocurrency trading platforms is very similar, there are distinct and often vast differences in quality between different platforms and the way that they operate.
In order to see this clearly, you need to look no further than going to one of the largest major cryptocurrency trading platforms and exploring their systems, compared to going to one of the smaller platforms that are less known and going through their site, and you will see a significant difference in the quality of the user interface, as well as the features and options which are available.
There is also a range of other differences between crypto trading platforms such as the kinds of unique features available, the reliability of the platform’s trading engine, the quality of the platform’s user interface, whether the platform is a global platform or only available locally, the kinds of KYC/AML procedures on each platform, and the quality of the platform’s trading tools and charting technologies.
One of the easiest ways to distinguish between different cryptocurrency trading platforms is by categorizing them as either a brokerage or exchange, with both types of platform having similarities in the way they operate and the experience that users have, but also having important distinctions between each other as well.
What are Brokerages?
Brokerages are cryptocurrency trading platforms where the platform itself is somehow involved in each trade that takes place, being that they actually provide liquidity for traders to use, trading with other traders, or partnering with liquidity providers who provide the services.
Brokerages are typically more advanced than exchanges, being that they have historically integrated advanced features such as margin trading into the systems, whereas it has taken exchanges much longer to also integrate these now-essential features.
Brokerages often have higher liquidity and less slippage and this is often as a result of the use of various liquidity providers to ensure that trade volumes across all assets being listed on a brokerage are high, and this is one aspect of brokerages that typically provides advantages over using exchanges.
There has been a boom in the introduction of brokerages into the cryptocurrency market over the past 3 or 4 years as traders within the market itself have become more sophisticated in their way of trading and have looked for platforms like brokerages in order to access more advanced features.
What are Exchanges?
Exchanges were the initial kind of trading platform that was introduced into the cryptocurrency market at its very beginning and throughout the history of cryptocurrency have been the more prevalent of the two different types of crypto trading platform categories.
Unlike brokerages which have an active role in trading, exchanges simply facilitate the ability for traders to be able to interact with each other in a seamless and fluid way, providing a central place for thousands or millions of traders to come together and to interact with each other.
While exchanges are meant to only provide facilitation of trading between other parties, it’s not unheard of for cryptocurrency exchanges to have their own trading desk and to sometimes directly interact with traders in the market as well, although this is typically frowned upon and is not something that many major exchanges engage with.
In return for the service, exchanges charge a trading fee on all trades that take place, with this often being a very small percentage of the value from both the maker and the taker, with other fees including deposit and withdrawal fees.
Exponential Growth of Value
When Bitcoin was originally created, its value is estimated to be around 0.003 cents for one Bitcoin, and while its price didn’t remain this low for long, even once it has begun to grow it was under one cent in value for a large amount of time.
Gradually over the years, Bitcoin made its way up to $1 in value, although even at this point there was a small number of people globally that knew about Bitcoin and had anything to do with it, and the total value of all Bitcoin in existence was smaller than the market cap of many of the projects that have launched over the last few years.
However, as the cryptocurrency market has grown and the number of users has increased exponentially, so has the value of all cryptocurrency in existence, with this increase occurring largely throughout 2016 and 2017 as thousands of new cryptocurrencies were created, a huge amount of investment flooded into the market, and Bitcoin’s price ballooned up to almost $20,000 at the end of 2017.
If the pattern we’ve seen over the past decade continues into the future, it is predicted that the value of a single Bitcoin could reach up to $100,000 within the next 18 months, and then in the next 5 years that it could even become as high as $1 million for a single Bitcoin, with this kind of increase in the price of Bitcoin carrying over into all other cryptocurrencies as well, with some expecting to see increases in value that will be significant over the coming couple of years.
Huge Increase in Users
The driving factor for the growth in the price of Bitcoin and the total value of all cryptocurrency has been the exponential growth of the number of users within the cryptocurrency market, based upon the variety of types of value that people have been able to gain from cryptocurrency.
While initially there were a small number of a few thousand people involved with Bitcoin, over the years that has grown to today being tens of millions of Bitcoin wallets in existence that have Bitcoin within them, and there being millions of daily cryptocurrency traders interacting with the market every day.
The growth of users has also been amplified, as one user generating significant profit will typically then bringing many more users who would also like to replicate that, with the connection between these referrals of them being family members and friends, and throughout the years this leading to an exponential growth in the number of people involved with cryptocurrency.
While this growth has been significant over the past decade, it is only still a small fraction of the total population of the world and over the coming years, it is expected that cryptocurrency will become ubiquitous throughout the world, being used on a daily basis by almost all people, and will largely supplant the current forms of money such as cash and credit cards.
Exposure in Mainstream Culture and the Financial World
One of the less obvious but more important ways that the cryptocurrency market and cryptocurrency as a whole has developed over the last 10 years is in its penetration into mainstream culture, and also it’s progressive integration into mainstream financial markets.
Both of these factors have been critically important in the growth of cryptocurrency as a legitimate financial asset and form of money and its own right, and as more people and financial institutions have come to adopt cryptocurrency, it has moved out of being a niche, scam-ridden form of darknet money into becoming something that people’s mothers and grandmothers use every day.
Bitcoin and other cryptocurrencies are being integrated into Wall Street and other financial markets around the world, and many banks and financial institutions are patenting new forms of Blockchain-based technologies which they’re using to integrate into their systems.
None of the platforms in the cryptocurrency space has seen the kinds of unparalleled growth that we have witnessed with PrimeXBT over the past few years as it has gone from a new fintech startup to being one of the leading cryptocurrency margin trading platforms on the market in 2020.
Although today a majority of all trades conducted within the cryptocurrency market a done using margin trading, when PrimeXBT launched in early 2018 margin trading was only just becoming popular, and was largely popularized by PrimeXBT as it provided high leverages comparable to that of traditional asset markets for the first time.
PrimeXBT lists a wide range of cryptoassets that include BTC, ETH, XRP, LTC, and EOS with leverage of up to 100X available across all cryptocurrencies, as well as a diverse range of the world’s leading traditional assets with leverage of up to 500X available across stock indices such as S&P500 and FTSE100, commodities such as gold and oil, and forex pairs such as USD/EUR and AUD/CAD.
The platform’s bank-grade security features, 4-tier referral program that has netting the top 3 affiliates more than $1 million in 2019, and providing the lowest fee schedule of any major cryptocurrency trading platform adjusts 0.05%, has ensured that PrimeXBT has continued to grow in size and prominence over the past few years.
Binance is one of the most easily recognizable cryptocurrency exchanges in 2020 and since it’s launch in 2017 has built a large following, with this being as a result of the use of its native cryptocurrency, the BNB coin, which allows traders at the platform to be able to reduce the trading fees by up to 25% by staking the coin.
Binance has an intuitive and easy to use interface and provides access to a wide range of different cryptoassets to be able to trade, with a professional trading environment being provided for its users, and a number of different ways to be able to generate an income in the cryptocurrency market.
Binance was a victim of one of the largest hacks in 2019 however, with more than $40 million of its users’ funds being stolen by hackers, and this has led many to question if Binance’s security is up to the task of protecting against future hacks.
As well as this, the only other negative thing to say about Binance is that its fee schedule is one of the highest within the cryptocurrency industry, being up to 10 times higher than other trading platforms, and if they were to reduce their fees it would help to make Binance more competitive against other major trading platforms.
The Growth of Margin Trading
Margin trading was first introduced into traditional asset trading markets a little over 15 years ago and has been a core part of their operation for the last decade and a half, whereas it’s only really been in the past few years that margin trading has taken off and become widely popular within the cryptocurrency space.
The growth margin trading in the cryptocurrency market has been as a result of its popularization by a small number of trading platforms that included margin trading into the core of the way they operated, instead of being an afterthought that was tacked on, and this changed the cryptocurrency market.
Cryptocurrency traders had long demanded better margin trading tools and features from trading platforms, and as soon as this became available it became ubiquitous throughout the cryptocurrency market with almost all major cryptocurrency trading platforms in 2020 offering margin trading to one degree or another.
The Integration of DeFi
DeFi, or decentralized finance, is a new trend that has been bubbling under the surface of the cryptocurrency market for the past couple of years but has only really emerged and become popularized in 2020.
The concept behind DeFi is the ability for traders to be able to provide access liquidity in the cryptocurrency market in a decentralized way, and for that to create all sorts of new mechanisms and systems of generating profit.
Namely, the trade in stablecoins and the exploitation of the differences in their values in constant fluctuations are traded, and today many major cryptocurrency trading platforms are either funding or integrating DeFi projects into the systems.
Crypto Social Trading
Cryptocurrency social trading is another trend that has spent the last few years growing in popularity but has really taken root in the cryptocurrency space in 2020, as the world’s largest crypto social trading platform, Covesting.io, announced a partnership with the leading multi-asset margin trading platform in the world, PrimeXBT.
Covesting.io created a new kind of crypto social trading in 2017 that is unique to the crypto space, and over the past 3 or 4 years has built the technologies and infrastructure needed to bring crypto social trading to the market for the first time.
By partnering with PrimeXBT, covesting has been brought to traders and investors in the market in a way that has been unprecedented, providing access to the large user base of millions at PrimeXBT, and rapidly popularising this growing new trend for collaborative cryptocurrency trading.
The clear pattern over the last 10 years has been for the progressive sophistication of trading platforms available within the cryptocurrency industry, coupled with the integration with the traditional asset market and mainstream financial institutions.
This has opened up new opportunities for cryptocurrency traders and investors to be able to explore opportunities for the generation of higher levels of profit and revenue, as well as unlocking untapped opportunities that present significant advantages compared to the limited ways of trading cryptocurrencies that have been available for much of the life of Bitcoin.
As trading platforms continue to become more advanced, so do the knowledge, skills, and experience levels of traders in the cryptocurrency space, and this has had a dramatic impact on the legitimacy of the cryptocurrency market over the past few years in particular, with cryptocurrency no longer being the play toys of geeks and criminals only.
This has been a much needed and necessary step for cryptocurrencies to penetrate into the mainstream areas of the world where people will inevitably be using them on a day-to-day basis for a plethora of different reasons, while as the market and industry has grown, the opportunities for entrepreneurs and professionals to work in the cryptocurrency space has also increased.
The past 3 or 4 years in the cryptocurrency market have been a new phase where we have seen the maturation of the industry as a whole, significant growth in the number of users in trading platforms within the space, and the introduction of a number of new ways to be able to access the cryptocurrency market providing alternative sources of revenue for cryptocurrency users.
With more than 500 active cryptocurrency trading platforms in the market today, there are less than a dozen that can be considered as the leading exchanges, with our selection of two of those exchanges that stand out amongst the rest as being the best in the industry.