Selecting the best crypto exchanges in the UK is a challenging, but very important, decision for ensuring a safe and efficient trading experience. The online trading platform you choose to buy crypto in the UK will affect your investment potential and overall finances. With numerous exchanges available online, it is essential to look at each one’s advantages and disadvantages, and to compare in order to find the one that best suits your needs.
Here are the key variables to consider, along with a review of the main British crypto exchanges with comparisons of the positives and negatives of each in order to help you make an educated decision.
Crucial Factors to Consider When Choosing a UK Crypto Exchange
- Regulation and security: A lot of cryptocurrency activity is unregulated. If you’re investing in cryptocurrencies in the UK, you should look for exchanges that are registered with the Financial Conduct Authority (FCA) for regulatory compliance and enhanced security. Other exchanges that are unregulated may offer easier access, or other benefits, but may also come with a higher risk. For security, use measures such as two-factor authentication (2FA) and cold storage.
- Reputation and reviews: Research different platforms to get real reviews. A well-reputed crypto exchange usually means reliable service and better customer support.
- Supported cryptocurrencies: Evaluate the range of cryptocurrencies offered. While major coins like Bitcoin and Ethereum are widely available, if you are interested in altcoins, you should look for exchanges with a broader selection.
- Fees and transaction costs: Understand the fee structure, as trading, withdrawal and deposit fees can all vary. Sometimes it may be worth paying a higher fee if other factors are improved.
- User experience and interface: Take a look at how easy the exchange is to use. If you are a more advanced trader, you may seek more advanced features.
- Liquidity: A high liquidity means transactions will be quicker, and the trading price will be more stable, 2 crucial aspects during high market volatility. Normally exchanges with higher trading volume will offer better liquidity.
- Customer support: You need reliable support, so look for those with multiple support channels and positive reviews.
- Payment methods: Choose an exchange that offers a convenient and cost-effective option, whether you prefer bank transfers, credit/debit cards, PayPal etc.
- Educational resources: This is more important for beginners as resources such as tutorials and webinars will help you learn and advance your skills as you go on.
Selecting the best crypto exchange in the UK is a pivotal decision when it comes to investing in blockchain projects safely and efficiently. With numerous exchanges to choose from, it’s essential to assess their advantages and disadvantages to find the one that best suits your needs. Here’s a comprehensive comparison of the top 5 crypto exchanges available in the UK.
1. Binance
Advantages:
- Extensive cryptocurrency selection: Binance currently offers over 110 cryptocurrencies, making it ideal for those looking to diversify their portfolios.
- Low fees: The platform is known for its competitive trading fees, starting from 0.1% for trades and bank transactions, which benefit frequent traders. It’s even cheaper if you pay in the native BNB coin.
- High liquidity: It is the most used exchange in the world meaning all markets are liquid and offer low slippage (the difference between the expected sales price and the price at which a sell order is filled).
- Advanced trading tools: Binance offers advanced tools for experienced traders, such as Futures and automated trading bots. These should be researched in detail before using.
- Robust security: Includes two-factor authentication (2FA) and cold storage for funds.
Disadvantages:
- Complex interface: The platform can be overwhelming for beginners.
- Regulatory challenges: Binance has faced scrutiny from regulators in various regions, with the FCA issuing a warning.
Ideal for: Experienced traders seeking a comprehensive platform with low fees and a wide selection of cryptocurrencies.
2. Coinbase
Advantages:
- User-friendly interface: Easy to use making it perfect for beginners.
- Cryptocurrency selection: Offers over 200 different cryptocurrencies.
- High security: Coinbase offers crime insurance, protecting portions of the cryptocurrencies held on their systems against any illegal losses from theft or cyber security breaches. They also use 2 factor authentication, password protection and require multiple approvals for any withdrawals.
- FCA compliance: Registered with the Financial Conduct Authority, and authorized as an electronic money institution.
- Educational resources: Offers extensive materials to help users learn about cryptocurrency trading.
Disadvantages:
- Complex fee structure: There is no flat fee on Coinbase, instead using “spread fees” that vary based on location, payment method, order size and market conditions. This lack of transparency can make it challenging to predict transaction costs as you only get to see the cost after the transaction is confirmed.
- High staking fees: Whilst they do offer staking, there is a 25% commission on staking yields which is much higher than the competition.
Ideal for: Beginners and security-conscious traders who value ease of use and regulatory compliance.
3. Kraken
Advantages:
- High liquidity: Liquidity is vital if you want to trade, especially with small cap coins.
- Wide cryptocurrency range: With over 220 cryptocurrencies currently available, Kraken offers a wide range of altcoins on top of the mainstream coins, making it a good choice for both mainstream investors and those looking for a wider portfolio.
- Advanced features: Kraken pro offers an attractive staking feature, allowing users to gain from holding different currencies on the platform, whilst also permitting margin trading increasing the potential for users to make larger gains.
- Strong security: The exchange employs strong security measures such as 2FA and cold storage, with regular updates, and regularly monitors any potential future risks.
- Customer support: Kraken support is available 24 hours a day via live chat, phone, and email
Disadvantages:
- High fees: Kraken Instant Buy charges a 0.9% flat fee for stablecoins and a 1.5% flat fee for all other cryptos, however upgrading to Kraken pro will reduce these but is a more complicated system.
- Complex interface: Can be challenging for new users.
Ideal for: Traders looking for a secure platform with low fees and advanced trading options.
4. Bitstamp
Advantages:
- Reputable service: It is one of the oldest and most established exchanges.
- Competitive fees: The highest fee is just 0.5% and this decreases as your trading volume increases.
- Advanced platform availability: Unlike Coinbase and some other exchanges, the fees don’t change with the basic and advanced platform, so you can choose your preference.
- Mobile app: Bitstamp’s mobile app has received predominantly positive reviews
Disadvantages:
- Limited cryptocurrency selection: Some major cryptocurrencies are unavailable in certain countries. It is advised to make sure you check the currencies you wish to trade are available before committing
- Cyber hack in 2015: One of the most crypto hacks occurred in 2015 via the Bitstamp platform. However, it is important to note that Bitstamp rebuilt its trading platform after the hack and hasn't had any data breaches since. The exchange also ensured that no clients lost their own funds
Ideal for: Traders who value a reputable and secure platform with competitive fees, despite fewer cryptocurrency options.
5. EToro
Advantages:
- User-friendly platform: The platform allows users to copy other traders’ strategies, making it a great choice for beginners. It also rewards users if their own strategies get copied, which incentivizes people to gain a following and is another potential stream of income.
- Security measures: Security protocols for crypto include offline and online storage of coins, two-factor authentication and unique monitoring tools
Disadvantages:
- Higher Fees and Spreads: eToro is not the option if trading fees are the main concern. They are working on cutting their fees but there are still many cheaper exchanges available
- Limited Cryptocurrency Range: Fewer options compared to other exchanges
Ideal for: Beginners and those interested in social trading and a platform that offers both crypto and traditional asset trading.
