The world of cryptocurrencies has seen a great deal of new users this year. A report by the University of Cambridge reveals that 101 million users joined the crypto world in 2020. Moreover, the number of unique cryptocurrency users has grown by 189% in the last two years. It appears that the era of global acceptance of cryptocurrencies has truly begun to set in. Naturally, crypto exchanges, which have historically served as the access points introducing users to crypto, are poised for massive growth by 2030. This greater enthusiasm in cryptocurrencies also necessitates that crypto exchanges be customer-friendly as new users continue to join in great numbers.
So what makes a crypto exchange customer-friendly? How do customers pick the best crypto exchange for themselves? Here are some essential components.
There have been several instances of nefarious activities and security breaches when it comes to crypto exchanges. Security, therefore, has always been a major concern in this domain, and different exchanges may use different means to tackle this concern. Modern standards have made the presence of two-factor authentication (2FA) features a necessity, particularly those that are compatible with apps like Google Authenticator. Exchanges may also have other security measures.
For example, Delta Exchange boasts enterprise-grade security, has multisig wallets, and processes withdrawals only once a day with manual review.
#2 User Experience
User experience as an essential component covers several dimensions. It includes everything from ease of understanding and navigation to a good customer support system that makes customers feel valued.
Exchanges may even go a step ahead and offer unique features to customers, such as Delta’s Mock Trading Platform that is particularly useful for new customers.
#3 Tokens Supported
While most exchanges support BTC trading and ETH trading, it is often useful for an exchange to support a wider range of tokens, altcoins and stable coins. This helps users diversify their investments and minimize risk.
#4 Products Offered
The services and products offered by exchanges vary quite a lot. Some of this can be accounted for by the types of crypto exchanges. Brokers operate like forex brokers to allow customers to buy cryptocurrency via their platforms; P2P exchanges allow buyers and sellers to make direct transactions; and trading platforms, which are the most common, operate much like stock exchanges.
For trading platforms, it is important that they have a wide range of offerings so that customers can have a better experience. These include crypto derivatives such as Bitcoin futures, crypto spreads, crypto options, and interest rate swaps.
Depending on various factors, often location and jurisdiction, it may be important for a crypto exchange to have a KYC procedure in place. This may involve submitting several documents such as proof of identity, proof of residence, etc. Some exchanges may also have anti-money laundering practices, which may require submitting personal information while creating an account.
Fee structures vary across exchanges and can be important to those customers who intend to buy and sell frequently as the transaction fee would add up. Common fee types include network fees, conversion fees, and maker or taker fees. Having incentives, rebates, or volume-based discounts on the fee amount can lead to better experiences for customers as low fees can enhance their long-term returns.
#7 Fiat Conversion and Payment Methods
Many traders and investors are going to need a fiat conversion facility to transfer currencies. Even with fiat conversion facilities, all types of fiat currencies are not going to be available in a single exchange.
Another aspect here is the payment method. This could be bank transfer, credit or debit cards, PayPal, or just cryptocurrencies. A customer-friendly crypto exchange should ideally offer all the common payment options.
How to Pick the best Crypto Exchange
A customer-friendly crypto exchange is imperative not only for attracting new customers but also retaining them. And while some of these features may not be useful for every customer, they still contribute to the overall reputation and authenticity of an exchange, which can be important for many.
As crypto continues to gain mainstream adoption and garner public interest, going through essential features and conducting your research can be an important step for new customers towards choosing the right crypto exchange.