Online Trading

  • Brokers
  • Markets
  • News
  • Analysis
  • Charts
  • Technical
  • Tools
  • Watchlist
  • Academy
  • Brokers
    • Commodities Brokers
    • Local Brokers
    • Discount Brokers
    • ETF Brokers
    • Futures Brokers
    • Brokers for Beginners
    • Commission Free Brokers
    • Bond Brokers
  • Forex Brokers
    • ECN Brokers
    • High Leverage Brokers
    • Low Spread Brokers
    • Zero Spread Brokers
  • Crypto Brokers
    • Crypto Trading Platforms
    • Leverage Trading Crypto
    • Crypto Exchanges
    • Crypto Trading Apps
  • Tradings Platforms
    • Robo Advisors
    • Algorithmic Trading Platforms
    • Trading Apps
    • Trading Robots
    • Metatrader 4 & 5
    • Social Trading
    • Day Trading Platforms
    • Automated Trading Platforms
  • Broker Reviews
    • Interactive Brokers vs Fidelity
    • Interactive Brokers vs E*Trade
    • Interactive Brokers vs Tradestation
    • Interactive Brokers vs TD Ameritrade
    • Capital.com
    • Plus500
    • XM
    • ActivTrades
    • Admiral Markets
    • FP Markets
    • AxiTrader
    • Exness
    • FBS Markets
    • OctaFX
    • Pepperstone
    • Swissquote Ltd
  • Guides
    • How To Buy Cardano
    • How To Buy Ethereum
    • How To Buy XRP
    • How To Buy Shiba Inu
    • How To Buy Bitcoin
    • How To Invest In AI
    • How to Buy Corporate Bonds
    • How to Buy Treasury Bonds
    • Financial Regulators
    • How to Invest in Metaverse
  • Strategies and Features
    • Brokers for Short Selling Stocks
    • Copy Trading
    • Gold IRA
    • Demo Trading Accounts
  • Stock Brokers
  • CFD

Table of contents

  • Do You Need a Broker to Trade Cryptocurrencies?
  • Advantages of a Cryptocurrency Broker
  • Disadvantages of a Cryptocurrency Broker
  • Is Cryptocurrency Trading Risky?
  • How Can I Tell if a Crypto Broker is Regulated?
  • How Do Cryptocurrency Brokers Make Money?

Best Crypto Brokers

Written By
Thomas Monteiro
arrow-top

Macro, Stock Picks

Opinion & Analysis Lead

BA in Journalism, PHD in Sociology, MBA in Economics.

  • linkedin logo
See Full Bio
Updated
September, 2023

Nothing moves faster than the cryptocurrency market these days. But to help you keep up with the fast-paced demands of the market, Investing.com has broken down all the best advantages of all the top crypto brokers. Check out our reviews to help give your portfolio an upgrade.


 


Cryptocurrency, compared to other currencies and trading products on the market, is still very new. Cryptocurrency includes currencies such as Ethereum, Bitcoin, and Litecoin. Cryptocurrency is decentralized and stored in a ledger, which is called a blockchain. Cryptocurrency allows people to pay and store money without going through a bank or even using their name.

Risk Warning info_outline

Our Recommended Online Brokers

Trusted Partner
Plus500
Plus500 Review
IFC Markets
IFC Markets Review
TRADIER
TRADIER Review

Our recommended brokers:

  • Plus500
    Plus500
  • IFC Markets
    IFC Markets
  • TRADIER
    TRADIER
  • Noble Gold
    Noble Gold
  • Birch Gold Group
    Birch Gold Group

Do You Need a Broker to Trade Cryptocurrencies?

The decentralized, anonymous nature of cryptocurrency means that you don’t technically need a broker to trade the currency. You can trade crypto with anybody—no fees, no centralized exchange, and no mediator. So, the question becomes whether you should work with a cryptocurrency broker.

A crypto broker serves as a middleman between the person buying and the person selling the cryptocurrency. The broker might also buy up a lot of cryptocurrency to sell on its own platform, making more of a direct seller. However, more often than not, the term “cryptocurrency broker” is used to refer to an intermediary. You place your order through the broker. After you pay for the cryptocurrency, the broker places your order on the crypto exchange.

Advantages of a Cryptocurrency Broker

There are several advantages of a cryptocurrency broker. First and foremost, the main advantage is the easy setup. Solo crypto trading is often associated with technical issues relating to the blockchain. Because a broker already has an established system, the technical issues are more avoidable. Also, a cryptocurrency broker lets you conduct leveraging, which is a type of trading that allows you to borrow funds to increase your position.

A cryptocurrency broker has more advanced technical instruments (such as a downloadable platform, mobile app, website, etc.) than someone who is doing it on their own. Crypto trading is faster, and you may also find that, when you use an established system, the price of the crypto is fairer.

Disadvantages of a Cryptocurrency Broker

Crypto brokers have their disadvantages. The main downsides to a crypto broker are fees and commissions. When you’re trading on your own, you don’t have to pay commission to anyone. A broker will likely charge commission, so you have to weigh the advantages listed above against the costs of such fees. Additionally, a crypto broker that is not reputable or regulated could cause you to lose money.

Is Cryptocurrency Trading Risky?

The short answer is yes. Cryptocurrency trading is risky because the currencies themselves  are usually very volatile. It’s not uncommon for the value to plummet hundreds of dollars at the drop of a hat. It’s also not uncommon for it to suddenly skyrocket in value.

Also, another major risk is crypto cybercrime. There is little to no regulation of this trading field, and cryptocurrency is not backed by the government. It doesn’t go through a bank, nor will the SEC reimburse you if you lose all your money. Crypto-related cybercrime ranges from mishandling private information to hackers raiding and depleting users’ cryptocurrency accounts.

How Can I Tell if a Crypto Broker is Regulated?

The EU and the US, under the Biden administration have started to regulate cryptocurrency brokers. This should speed up in the aftermath of the SVB disaster. Additionally, countries like the UK are pushing forward with regulating cryptocurrency brokers. 

While most countries do inforce regulations, it is still important to remain vigilant of the warning signs of an unscrupulous or untrustworthy broker. Spotting these warning signs is key to avoiding being a victim. Such signs include non-existent services and products, unrealistic promises, questionable marketing practices, and anonymous identities of brokers.

  • Non-Existent Services: If the broker lists certain services in its marketing, it should have those services. For example, if a broker says that it offers research and data, there should be research and data available on its platform. Simply put, the products and services listed should be there for you. If the broker is being dishonest about these services, move on.

  • Unrealistic Promises: If a crypto broker promises you that you are going to get rich, they are not trustworthy. A good broker knows that all trading, whether crypto or non-crypto, is volatile, and you shouldn’t make promises that might not come true. The broker should only promise to be ethical and provide a solid platform. Making unrealistic predictions is a sign that the broker is unscrupulous.

  • Questionable Marketing: This is especially common on social media. If a broker makes fake accounts on social media, with each account claiming to be a satisfied customer, that broker is a scammer. Don’t just avoid doing business with the broker, block them too.

  • Anonymous Identities of the Brokers: You should know the identity of the broker with whom you’re getting in business. While the nature of cryptocurrency allows for anonymous transactions, starting a crypto platform is, essentially, starting a business. A broker must be transparent about its identity, just as any business would. If the broker won’t even share their name, there is likely a good reason, and you should definitely avoid them.

How Do Cryptocurrency Brokers Make Money?

Cryptocurrency brokers make money by charging fees and commissions on the transactions they conduct. Cryptocurrency is new enough that many brokers are able to charge higher fees than they would for other, non-crypto products.

Additionally, they also make money from trading derivatives. Traders using brokers to buy and sell cryptocurrency derivatives contracts do not own the actual cryptocurrency. Since traders don’t own the crypto coins, Brokers get to speculate with the asset while making money from the derivatives contracts simultaneously.

All in all, cryptocurrency is volatile, but it can be lucrative. When you’re looking for the best cryptocurrency broker, make sure you pick a broker who is transparent, honest, and has nothing to hide. Reading reviews will help you with your selection.

Investing.com
  • Terms And Conditions
  • Privacy Policy
  • Risk Warning
  • Do Not Sell My Information
© 2007-2023 Fusion Media Limited. All Rights Reserved

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.