Every day, new platforms emerge on the internet. Applications such as Twitter, Facebook, Instagram, SnapChat, and TikTok dominate social media platforms. Messaging services such as WhatsApp, Signal, Messenger, and Telegram are extremely popular messaging platforms.
These platforms dominate over other unknown social media and messaging platforms because they are reliable and user-friendly. Although most people will call them trustworthy, every platform has its security flaws.
When you are looking for a crypto trading platform, security is one of the top concerns. Unlike posting a selfie on a social media platform or sending a message to a friend on a messaging platform, you will be using your hard-earned money to buy crypto. A security flaw can result in life-changing detrimental effects. Here are four tips on how to successfully choose a crypto platform.
1. Security First
Companies all over the world continue to develop and promote new crypto platforms. The first cryptocurrency, Bitcoin, was first developed in 2009 by Satoshi Nakamoto. Fast forward to 2022, there have been hundreds of other types of cryptocurrencies developed such as ETH, LiteCoin, XRO, Stellar, Cardano, Tether, and Polkadot. To keep up with the new forms of cryptocurrency, new crypto platforms are developed daily.
Not every crypto exchange platform is built the same. Some crypto platforms are not nearly as secure. When you are searching for the best crypto platform, you should first look to see how secure it is. Most likely, you will be using a personal debit card or bank card to buy the cryptocurrency. If the platform is not secure, it puts you at risk of being hacked. A hacker can steal money from your bank account and crypto profile on the platform.
Some trading platforms may be susceptible to spam or bad links. If a hacker cannot take your money directly from the platform through your bank account or crypto wallet, they can still access private information. For example, an unsecured platform allows hackers to track your computer usage, access your hard drive, and use your IP for illegal internet activity. They may also use private identifying information such as your name, address, and social security numbers to steal your identity.
2. Available Cryptocurrencies
Once you have found a few platforms that appear secure, you can also determine which Crypto platform is best for you by what they offer. Some trading platforms will only allow you to buy specific types of cryptocurrency. For example, on one platform you may be able to purchase ETH and LiteCoin, whereas on another you can purchase Stellar, Polkadot, and Cardano. Large and well-established trading platforms may offer their users multiple wallets for a wide range of cryptocurrencies.
When you have found a product or service that accepts bitcoin, it would not be helpful to join a trading platform that only allows you to purchase ETH. Knowing what kind of cryptocurrency you want to buy will help eliminate platforms. By the process of elimination, you may find the trading platform that is right for you.
3. Check Processing Fees
Each trading platform will have processing fees or rate of exchange fees. These fees are extremely important to pay attention to when you are purchasing cryptocurrencies. An unknown cryptocurrency may only be worth pennies. When you decide to buy the cryptocurrency, the trading platform will take a small percentage or portion for the exchange.
For example, one platform may take a 1% processing fee when you buy ETH. Another platform may charge a flat-rate fee of $3.00 every time you buy ETC. In some cases, these fees are very high. When you buy the cryptocurrency, you will see the amount of cryptocurrency in your wallet is lower than how much you purchased. The hope is that the value of the currency will increase and you will recoup the processing fees as well as make a profit.
There are also processing fees when you sell cryptocurrency for dollars. These fees can be so expensive, you may lose more money during the exchange than you made in profit. You could lose money due to fees even when you made a good investment.
4. Invest What You Can Lose
The value of cryptocurrencies greatly changes throughout the hour, day, and week. If you buy one type of cryptocurrency valued at 60k dollars per coin, and the value drops to 30k per coin an hour later, you will be devastated knowing you only retain half your investment.
Imagine if you bought $1,000 in cryptocurrency and only left with $500. It can feel like a huge loss. Cryptocurrency is not as steady as the value of the dollar.
You can gain a lot of money by investing, but also lose a lot of money if you make the wrong choice of when to buy cryptocurrency. You should only invest the money you are not scared to lose. Cryptocurrency is decentralized. There is not any existing trading platform that can assist you in recouping lost funds.