Activities

WhiteBIT Cryptocurrency Exchange

Cryptocurrency is a concept that has become a part of our everyday life. We hear it on the radio, see ads, read the news. The basis of crypto is decentralization, that is, transactions between users are carried out without any intermediaries. It allows operations to be performed much faster while maintaining the needed security level. For these reasons, the interest in the cryptocurrency world is growing and will continue to do so. To make money on digital assets, users go to a bourse. It is the main place to buy and sell digital currency. But it is not the only opportunity offered by such websites. What is a cryptocurrency exchange? If you do not know what that is, you may suffer substantial money losses. To avoid that, you need to dig into the concept and figure out how it works.

What Is a Crypto Exchange?

In simple terms, it is a trading platform that allows you to change cryptocurrencies for other assets. Other assets are fiat and digital currencies. The user’s ultimate goal is to profit from trading. Despite the market’s development, the goal remains the same.

A Brief Look at the History of Crypto Exchanges

The first platform was created back in the first half of 2010. It was called Bitcoinmarket.com. Its purpose, first of all, was to establish the value of bitcoin. The creator turned it into a commodity, made it possible to purchase and make money on it. In July 2011, its main competitor, Mt.Gox, was launched. After 3 years, it has taken over 70% of all BTC transactions. But, in the same 2014, the auction stopped due to a large theft of funds. 850 thousand BTC were stolen, and the fault fell on the creator. At the beginning of the path, crypto trading exchanges could provide only limited functionality. And security was lame: bugs were fixed only if they appeared. Now the situation is different. One should choose which platforms to trade on carefully because there are hundreds of options available. The largest market players, and any legit crypto exchange websites, are more interested in the assets’ safety than you are. And further, we will tell you how it all works.

How Does Cryptocurrency Exchange Work?

We have already told you what it is. Now we have got to work out how does crypto exchange work. Users trade cryptocurrency on it. The profit comes from rate fluctuations. High volatility is inherent in crypto. Therefore, you can make money with even a small sum. The way digital asset bourses work resembles regular bourses. Anyone can trade. To become a trader, you need to:
  • register: you need a minimum of data such as name and country of residence. Trading for residents of some territories may not be available;
  • deposit money into your account: after it, the client will be able to purchase tokens and then sell them.
To buy and sell, you need to create an order indicating the amount of currency and place it on the DCE. When there is a person willing to pay the specified amount of assets, the order will be executed. There are no difficulties in how to exchange cryptocurrency. You can understand how everything works only from the inside. The main point is the same: buy and sell. But there are differences between the platforms themselves. Yes, there are different types of platforms.

What are the Types of Crypto Exchanges?

There are two popular types: centralized and decentralized. Each provides its own benefits. But the most common form of trading is centralized.

Centralized Crypto Exchange

The key difference between the main types of platforms lies in the regulating mechanism. Centralized or CEX is a trading platform that is managed by one organization. It is confusing for most people: a centralized platform for trading decentralized currencies. In fact, for newcomers, this one is the best tool at the beginning. The type is popular with non-technical users. They are provided with a user-friendly interface and technical support. In addition, the customer literally gives his funds for storage. It means that you do not possess your private key. In theory, this could lead to assets’ loss. In fact, the cryptocurrency exchange website is interested in the safety of your money in order to maintain its reputation. If users lose trust, they will leave the platform. In turn, the provider itself will lose its source of income.

How Does Centralized Cryptocurrency Trading Exchange Secure Customers?

The security measures include KYC, 2FA, and other methods.
  • KYC – user verification with documents. Withdrawals may not be possible without KYC. It reduces the number of fraudulent transactions.
  • AML is a set of actions that prevent money laundering and terrorist financing.
  • 2FA stands for two-factor authentication, that is, two-step verification of identity. Most often, a code generated by phone or PC is used together with a password.
  • Binding IP address to User Profile – this option is available only for static (unchanged) IP. Even if the scammers have all the data, they will not be able to enter your account or trade crypto exchange from another IP address.
Withdrawal notifications – you get a mail telling you that there has been an attempt to withdraw money from the account. The system notifies you and asks for your confirmation to proceed. Funds blocking – usually, the method is used when trying to withdraw funds immediately after profile data change. The operation is simply unavailable for a while. Anti-phishing, insurance funds, and other protection tools are also wide-used. However, each platform employs its own security methods. Like banks, CEXs do everything to protect their audience. Although, this doesn’t exclude financial risks and cases of money thefts.

Decentralized Cryptocurrency Exchanges

Decentralized or DEX functions opposite to the CEX model. Its peculiarity lies in using blockchain to operate. Transactions are direct without intermediaries and, thus, occur almost instantly. On the one hand, it is safer this way. By analogy with the real world, you give money to another person, and you do it personally. In DEX, everything is the same, only in electronic form. There is no intermediary between the holders. On the other hand, you are also responsible for your private key. If you lose it, you will not be able to restore it. And if you are exchanging cryptocurrency and keeping funds at CEX, the system restores access in no time. Cryptocurrencies on DCE are often subjected to fraudulent attacks. It would be even more accurate to say that the loss of funds is possible on both CEX and DEX. So, before registering at any platform, ask yourself – what is cryptocurrency exchange for you? What do you demand from it?

WhiteBIT – Legit Crypto Exchange

WhiteBIT is a centralized European platform with a license for such activity. WhiteBIT has been on the market since 2018. More than a million users have already joined it. The company is also in the TOP- 50 sites according to the ratings of CoinMarketCap and CoinGecko. You can earn money there not only by trading digital currency. In addition to trading, there are opportunities to receive bonuses under the referral program. Users can also use SMART-staking to generate income. There are spot and margin trading. WhiteBIT is one of the easiest crypto exchange platforms because the interface is adapted for the basic and professional level of traders. Users can also take advantage of Conditional, Market, Stop and Limit orders. You can replenish your balance with both fiat and cryptocurrency.
More