You feel ready to leap into the exciting world of crypto-asset trading, but struggle to find a reliable crypto broker? We can get you started with our top picks and help you choose a trading site that is right for you. Selecting a trusted broker is the first step to success when it comes to investing in cryptocurrencies.
Each crypto broker has its strengths so you must determine which one best addresses your individual needs and trading goals. BestBrokers.com has compiled a list of crypto brokerages where you can trade decentralized currencies with confidence and ease. We work with a team of adept traders, writers, and editors capable of adequately evaluating the merits and drawbacks of each crypto-asset broker.
Our experienced team is dedicated to assisting the readers of BestBrokers.com in making informed and sensible decisions by providing them with unbiased reviews of top-tier online brokers for crypto trading. We are confident the brokers we have shortlisted are trustworthy and worthwhile as we have tried each of them ourselves.
Best Crypto Brokers
- Crypto Spreads/FeesAverage spreads of 0.001 for DOGE/USD, 0.003 for ADA/USD, 3.833 for ETH/USD, 31.720 for BTC/USD, and 1.153 for BCH/USDMin Withdrawal and Fees$30 for wire transfers; freeCrypto ExchangeN/AFinancial RegulatorsASIC (Australia), VFSC (Vanuatu)Supported CryptocurrenciesBitcoin, Cardano, Ethereum, Binance Coin, Bitcoin Cash, Dogecoin, Polkadot, EOS, Chainlink, Stellar, LitecoinExcluded JurisdictionsUSA, New Zealand, Somalia, Congo, Myanmar, North Korea, Palestine, Syria, Iran, Iraq, Sudan, YemenRisk Warning: Gleneagle Asset Management Limited (ABN 29 103 162 278) trading as Fusion Markets, is the issuer of the Fusion Markets Products described in this communication. Trading in Fusion Markets Products involves the potential for profit as well as the risk of loss which may vastly exceed the amount of your initial deposit and is not suitable for all investors. You should read all of these Financial Product Service Terms, the Product Disclosure Statement (PDS) and the Financial Services Guide (available on our website) carefully, consider your own financial situation, needs and objectives for investing in these Fusion Markets Products and obtain independent financial advice.
Fusion Markets is an Australia-facing online broker that operates under the authorization of ASIC and VFSC. While foreign exchange trading is its biggest strength, the company provides additional investment opportunities such as indices, metals, US stocks, and soft commodities.
Speculating on the prices of underlying cryptocurrencies is also possible for Fusion Markets customers. The broker offers contracts for difference for popular crypto-fiat pairs like BTC/USD, ETH/USD, ADA/USD, BCH/USD, and LTC/USD. The average spreads are crypto-specific, starting at 0.001 for some pairs.
Professional traders and VFSC customers will benefit from crypto leverage ratios of up to 5:1. Retail clients must comply with caps of 2:1 when trading digital coins. Traders in possession of crypto wallets and assets can fund their live balance via Bitcoin, Ethereum, Stellar, Litecoin, and Bitcoin Cash, among other supported cryptocurrencies.
The online brokerage also offers various fiat modes of payment, including Perfect Money, Skrill, Visa, PayPal, Neteller, Jeton, and Mastercard. There is no minimum withdrawal requirement at Fusion Markets unless you use bank wire transfers, in which case you can request no less than $30. Two types of live accounts are available – Zero and Classic.
- 2. AvaTradeCrypto Spreads/FeesSpreads range from 0.20% to 2% based on the specific cryptocurrenciesMin Withdrawal and Fees$1 min. for cards and e-wallets; $100 min. for bank transfers; no extra feesCrypto ExchangeN/AFinancial RegulatorsCySEC (EEA), ASIC (Australia), CBI (Ireland), BVI FSC (British Virgin Islands), FCA (United Kingdom), ISA (Israel), FSCA (South Africa), FSRA (Abu Dhabi)Supported CryptocurrenciesBitcoin, Ethereum, Ripple, Dash, Litecoin, Stellar Lumens, Bitcoin Cash, NEO, IOTA, EOS, Bitcoin Gold, Chainlink, Uniswap, Crypto 10 IndexExcluded JurisdictionsBelgium, the United States, New Zealand, Iran, Syria, Cuba, and moreCFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
AvaTrade has more than fifteen years of experience in the online trading industry and is regulated in major jurisdictions like the UK, Australia, and Cyprus. More than 300,000 traders call it home, which is unsurprising considering the broker’s solid offering of over 1,200 tradable instruments. Among those, you will find hard and soft commodities, fiat currencies, stocks, and bonds.
The reliable broker caters to customers looking for exposure to the crypto markets by offering them a wide range of digital currencies. Bitcoin, Litecoin, Stellar, Ethereum, Dash, and Ripple are all on the AvaTrade roster. The broker offers derivative contracts for 16 or so cryptocurrencies, allowing customers to profit from price fluctuations alone, without owning any underlying crypto assets.
Over-market spreads are competitive enough but vary across the board, depending on what virtual currency one trades. Apart from individual currencies, the broker offers trading on the Crypto 10 Index. It tracks the overall performance of the ten biggest cryptos on the market based on market cap.
Traders face a rich selection of platforms, including industry-leading options like MetaTrader 4, MetaTrader 5, and ZuluTrade. Clients will benefit from outstanding customer service available in multiple languages via live chat, email, and telephone.
- 3. eToroCrypto Spreads/FeesSpreads range from 0.75% for BTC to 4.9% for smaller-cap cryptos like REN, SNX, and MKRMin Withdrawal and Fees$30 minimum; fees of $5 per requestCrypto ExchangeYesFinancial RegulatorsASIC (Australia), FCA (United Kingdom), GFSC (Gibraltar), FSAS (Seychelles), CySEC (EEA), NDB (the Netherlands), FinCEN, SIPC, FINRA (United States)Supported CryptocurrenciesBitcoin, Ethereum, Bitcoin Cash, Ripple, Dash, Cosmos, Axie Infinity, Polygon, Polkadot, Quant, Solana, Algorand, Celo, Dai, Stellar, Binance Coin, Cardano, Tezos, IOTA, Litecoin, NEO, EOS, Ethereum Classic, Dogecoin, Shiba Inu, Chainlink, Zcash, Curve, and moreExcluded JurisdictionsCanada, Japan, Hong Kong, China, Indonesia, Egypt, Russia, Saudi Arabia, New Zealand, Ukraine, Serbia, Turkey, South Africa, Macau, India, Kenya, the Bahamas, Tanzania, and moreCFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Established in 2007, eToro is a front runner in the online trading industry that operates across multiple jurisdictions like Australia, the US, and Great Britain. The company revolutionized the way people trade in 2010 when it introduced the world’s first social trading network. The brokerage strives to enhance its customers’ financial knowledge with a broad range of educational resources, including guides, trading videos, and podcasts.
Clients of eToro can invest in over thirty cryptocurrencies and altcoins like Ether, Bitcoin, Litecoin, Dash, Ripple, and Cardano. The brokerage takes trades on crypto crosses and currency crosses, but trading commodity crosses like GOLD/BTC is also a possibility.
One of the biggest selling points of eToro is that it offers exchange services, allowing professional and institutional traders to buy and sell crypto coins via its eToroX platform. On top of that, the brokerage offers a proprietary multi-crypto wallet (eToro Money) where customers can store their digital coins. The wallet comes with high levels of security and a DDoS feature that prevents unauthorized access.
Those who decide to join eToro with live accounts can fund their balance with a range of trusted payment solutions like credit/debit cards, PayPal, Neteller, Klarna, Skrill, and Trustly. Withdrawals from eToro live accounts start at $30 and come with additional charges of $5 per request.
- 4. IC MarketsCrypto Spreads/FeesMin. spreads range from 0.000 pips for DSH/USD and EOS/USD to 8.710 pips for BTC/USDMin Withdrawal and FeesNo min. amount requirements; AU$20 for international bank wire transfers, free for cards and e-walletsCrypto ExchangeN/AFinancial RegulatorsASIC (Australia), FSAS (Seychelles), CySEC (EEA), SCB (the Bahamas)Supported CryptocurrenciesBitcoin, Bitcoin Cash, Polkadot, Dash Coin, Emercoin, EOS, Ether, Chainlink, Litecoin, Namecoin, Stellar, Peercoin, Cardano, Ripple, Binance, Uniswap, Dogecoin, TezosExcluded JurisdictionsIran, Japan, the United States, New Zealand, Israel, Canada, Iraq, North Korea, Yemen, Afghanistan, Cuba, SyriaRisk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.32% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
IC Markets is a trusted online broker authorized across multiple tier-one jurisdictions like Australia, Great Britain, and the EU. Traders have hundreds of global markets readily available at their fingertips as the broker offers over 60 forex products, 20 commodities, 730 equity stocks, and 25 indices.
With more than 180,000 active clients around the globe, the company boasts a high trust score among users thanks to its reliable service, proactive customer support, and rapid order execution. In addition to fiat products, IC Markets provides a choice from a dozen or so digital currencies available for derivative trading through contracts for difference.
CFDs enable traders to open long or short positions for a wide range of digital assets without taking ownership of them. Through these speculative instruments, IC Markets clients can gain exposure to cryptos without worrying about the risks that result from storing them. Customers can profit from the spiking and dropping prices of various cryptos against the dollar, including Bitcoin, Litecoin, Ethereum, Cardano, Dash, Stellar, and Ripple.
Maximum CFD leverage ratios are influenced by various factors such as region and whether one is a retail or an institutional/professional trader. IC Markets quotes tight spreads that start at zero for some crypto-fiat pairs and charges no commissions for cryptocurrency trading. The broker has no minimum withdrawal requirements and processes requests to cards and e-wallets at no extra cost.
- 5. PepperstoneCrypto Spreads/FeesSpreads start from 0 pipsMin Withdrawal and FeesNo min. withdrawal requirements for most methods ($80 for international bank wires); bank transfers may incur extra feesCrypto ExchangeN/AFinancial RegulatorsCySEC (EEA), ASIC (Australia), FCA (United Kingdom), SCB (the Bahamas), BaFin (Germany), CMA (Kenya), DFSA (Dubai)Supported CryptocurrenciesBitcoin, Binance Coin, Bitcoin Cash, Cardano, Chainlink, Dash, Dogecoin, EOS, Ethereum, Litecoin, Polkadot, Ripple, Stellar Lumens, Tezos, Uniswap, Crypto10 Index, Crypto20 Index, Crypto30 IndexExcluded JurisdictionsBelgium, the United States, Afghanistan, Canada, Iran, Iraq, Yemen, and moreCFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72.2% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
At Pepperstone, you will discover opportunities for over 1,200 instruments tradable via derivative contracts for forex, commodities, shares, and exchange-traded funds. The ASIC and FCA-regulated brokerage prevails over the competition with highly competitive spreads, ensuring deep liquidity and excellent order execution that averages 30 milliseconds.
Pepperstone does not lack options for those looking to tap into the exciting crypto markets, either. The broker boasts a solid offering of virtual currencies available for trading without the necessity of ownership or digital wallets. The company gives you instant access to the decentralized markets via CFDs, with leverage caps of 2:1 for retail clients and 10:1 for professionals.
Live account holders can profit from rapid price movements and high volatility at all times. Pepperstone offers weekend trading on Ethereum, Bitcoin, Polkadot, Litecoin, Ripple, Cardano, Stellar, Dogecoin, Chainlink, and many others. Minimum spreads start at zero for Ethereum, EOS, and Polkadot, climbing all the way up to 30 pips for BTC/USD.
Speculating on crypto versus fiat prices is not the only way to obtain exposure to the digital currency markets at Pepperstone. Another option is to trade crypto indices that reflect the overall performance of entire baskets of highly traded coins. Pepperstone customers face a choice from popular indices like Crypto30, Crypto10, and Crypto20.
Our Areas of Interest when Assessing Crypto Brokers
BestBrokers.com strives to provide its readers with objective information unskewed by affiliate relations with the reviewed trading firms. We base our reviews on solid facts and our personal experience with each crypto-trading platform. Our reviewers cross-reference their findings with the feedback of fellow traders to gain a wholesome perspective of each crypto broker.
We have developed a holistic approach that takes into account the brokers’ performance in several areas, each one with multiple variables. The reviewers attach individual scores to each category before they crunch down their overall findings and experience to produce a conclusive rating.
They base the ranking on five-star ratings, rounding them to the nearest half-star. The scores for each area depend on how well the brokers perform compared to their competitors. We pay attention to the following aspects during our extensive evaluation process.
Licenses and Regulatory Framework
The first thing we check is whether the broker has obtained a license from a top-tier financial regulator like the FCA, CFTC, ASIC, FINMA, CySEC, or BaFin. Holding licenses from multiple regulators is always a plus that earns the broker extra points in this area. We also review the brokers’ history, observing for any past issues and complaints from its clients.
Types of Available Accounts
The BestBrokers.com team members create live accounts to test the brokerages first-hand. They also consider the range of available account types, noting down the pros and cons of each type. The more account types are on offer, the better the broker scores in this category. A good crypto trading site caters to retail as well as to professional traders with suitable account types.
Spreads and Other Trading Costs
These are among the key factors that bear consideration when choosing where to take your crypto trading activities as they can greatly affect your bottom line. We open multiple positions, hold them for a while, and then close them to unveil any potential hidden costs. The brokers with the tightest spreads, nominal rollover fees, and low (or zero) commissions receive the thumbs-up from us.
Platforms Range and Usability
The range of available platforms and their overall usability are also among the parameters we consider. The reviewers look at factors like interface convenience, the availability of TA and FA tools, timeframe number, and supported order types. They give a test drive of each platform, trying out its web and downloadable versions.
Cross-Compatibility and Mobile Apps
At BestBrokers.com, we also regard cross-compatibility, assigning the highest scores to brokers that allow you to dabble in the crypto market via native mobile applications for Android and iOS. Additionally, we check the web versions of the trading platforms to ensure they are compatible with as many mobile browsers as possible.
Range of Financial Instruments
A versatile selection of asset classes and financial instruments is important because it helps with risk management and portfolio diversification. A broker with a comprehensive inventory provides a diverse range of assets apart from crypto, including shares, forex pairs, commodities, bonds, and more.
Execution Type and Speed
We look at the way the brokers route traders’ orders for execution, prioritizing those that use ECN order execution. Such brokers connect you directly to other market participants and give you access to interbank prices. There are numerous benefits from this approach, including fewer requotes, higher price transparency, and tighter spreads. The order execution speed is another aspect we evaluate. If slow, it can negatively affect traders’ overall performance.
Supported Payment Solutions
Topping up the balance of your live account and withdrawing your gains are essential for your overall experience at a crypto broker. Both depositing and cashing out should be hassle-free and smooth as butter, with minimum or no transaction costs. A diverse enough selection of supported banking methods is a bonus that further adds to the brokers’ scores for this area.
Customer Support Quality
Crypto trading is not always a seamless process, especially if one is a first-timer or a novice. Qualified and timely customer support is essential when you need assistance or are looking to get an issue fixed. A broker offering a round-the-clock customer service available in multiple languages holds all the aces against its competitors in the support department.
Research and Education Amenities
To stay on top of the crypto markets, you need a broker that provides outstanding and comprehensive educational materials, along with independent research and analysis. The BestBrokers reviewers check whether the brokerages ensure access to the latest news from the crypto world, which is very important for those who trade the news.
Safety and Investor Protections
We list this parameter last but this does not mean it is less important. Online trading sites collect sensitive information from their customers and should safeguard it with sophisticated encryptions. Various investor protections should be in place as well, such as compensation funds, negative balance protection, margin close-outs, and more.
The Advantages of Dabbling in the Crypto Market
People commonly associate crypto trading with dramatic price movements and high risk levels, but investing in decentralized currencies is not without its merits. If you have the risk tolerance to stomach the higher volatility of these digital assets, here are four reasons why you should consider trading cryptocurrencies.
24/7 Market Hours
Unlike the commodity and stock markets, the crypto markets are open round-the-clock throughout the entire year. You can invest in them whenever you wish provided that you find a reliable enough brokerage or exchange with competitive pricing.
Privacy and Decentralization
Decentralization is among the most appealing characteristics of crypto assets. The decentralized nature of cryptocurrencies makes it impossible for governmental and financial institutions to interfere with crypto transactions. In turn, this renders cryptocurrencies an excellent choice for traders looking for more privacy.
Lower Susceptibility to Inflation
Conventional fiat currencies are susceptible to inflation, but this is not the case with decentralized crypto assets. While not entirely immune to inflation, cryptocurrencies handle it better because most of them have caps on the maximum coins in circulation. With fiat currencies, central banks can print as much money as they wish, causing their value to depreciate.
Cryptocurrencies are more volatile than other assets and this is not necessarily something to frown upon. High volatility is one of the aspects that make crypto trading so thrilling. Swift price fluctuations create more trading opportunities for proficient investors, allowing them to lock in quick profits. With that said, we caution you to do your research and devise an effective risk-management strategy before you dabble in any cryptocurrency trading with our shortlisted brokers.
Types of Crypto Trading Instruments
Top-tier crypto brokers provide their clients with various ways to trade digital currencies. Some of the most widespread instruments available to crypto traders include spot trading and derivatives like contracts for difference, options, and futures. We expand on each of these below.
Spot Trading – This is the most basic form of crypto trading, which renders it suitable for beginners. Here you buy or sell cryptocurrencies on the spot, meaning that you must actually own the assets to trade them. You can trade your cryptos for fiat currencies, other decentralized currencies, or even hard commodities like gold.
Crypto CFDs – CFDs, short for contracts for difference, enjoy great popularity in the crypto-trading community as they allow traders to profit from price movements alone. There is no need to purchase or own any crypto assets – you only speculate on the rise and decline of prices. These derivative instruments allow you to leverage your positions and increase your exposure.
Crypto Futures – Futures are more complicated instruments and as such, are ill-suited for inept traders. Similarly to CFDs, these are derivative contracts that compel the parties involved to buy or sell an asset at a prearranged price and date in the future. You again have access to leverage, which can enhance your potential gains as well as your losses should the markets move unfavorably.
Crypto Options – Options are another derivative instrument that allows for the usage of leverage. With options contracts, you have the right to purchase or sell assets at a pre-agreed strike price on or before a specific date but are not obligated to do it. Call options entitle you to the right to purchase the underlying asset, whereas put options grant you the right to sell it.
Digital Currencies to Trade at Crypto Brokers
Bitcoin has gone viral in the past few years, but it is hardly the only cryptocurrency you can trade at our shortlisted brokerages. From ether to ADA and tether, there is no shortage of crypto coins to invest in online.
Bitcoin (BTC) is the harbinger of all crypto assets, boasting a market cap of more than $816 billion as of January 2022. The best brokers in the industry allow you to trade it for other cryptocurrencies, commodities like gold, or fiat currencies at a fair cost. The high liquidity of this cryptocurrency renders it a suitable investment vessel for traders who seek to reap short-term profits.
Ethereum and its native coin ether (ETH) are among the most popular alternatives to Bitcoin trading. Ethereum has witnessed impressive growth over the last few years, with a market cap that stood at $401 billion on January 12, 2022.
ADA is the native currency of the open-source blockchain platform Cardano, which is somewhat of a late arrival to the crypto-asset scene. Initially released in 2017, this crypto coin has experienced a more gradual growth over the past four years. The spikes in its price are not as sharp, which makes it less volatile compared to some other cryptocurrencies.
Tether (USDT) is unlike most other crypto assets as it is a stablecoin, meaning that its price is pegged to that of a standard fiat currency, the US dollar. The peg protects it against dramatic fluctuations. The value of a single tether token always revolves around $1. If there are any price movements, they are negligible.
Litecoin (LTC) was among the first cryptocurrencies to appear after the launch of Bitcoin. Launched in 2011, it went on to become one of the world’s largest decentralized currencies. At the time of publication, it has a market cap exceeding $9.5 billion, which makes it the 24th biggest cryptocurrency on the market. Ripple outperforms Bitcoin when it comes to transaction processing speed and energy efficiency.
Common Types of Orders at Crypto Brokers
When comparing our shortlisted brokers, you will notice they offer various order types, the most common ones being market, limit, stop loss, and take profit. More complex orders like the ICO and bracket orders are also available at some of the brokerages we recommend.
With orders, you instruct your broker how and when you want them to execute your trades after they enter the crypto marketplace. In what follows, we provide concise explanations of how the common crypto order types work.
Market Orders – With market orders, you tell the broker to immediately open a position at the current best market price. Here you must only state the amount of the respective crypto asset you want to purchase or sell. Slippage may cause you to pay more than you originally thought.
Limit Orders – When you put in a limit order, you must additionally define the exact order amount and price. Your broker will fill the order only on condition the market has reached your predefined limit price or better. There is no guarantee of order execution.
Stop Loss Orders – The purpose of stop loss orders is to restrict the losses from your positions in the event of unfavorable market movements. One major benefit of this order type is that there is no need to constantly oversee your positions. On the downside, adverse market movements can trigger the stop loss order, causing an unnecessary sale.
Take Profit Orders – These outline the precise prices at which traders want to close their positions to lock in specific target profits. A TP order is very useful since it enables you to potentially maximize your short-term returns. The broker will not act on the order if the price fails to escalate to your specified limit.
Immediate or Cancel Orders (ICO) – ICO orders share some similarities with market orders as they mandate the immediate purchase or sale of a given asset. If the broker cannot fill a chunk of your order right away, they will cancel it altogether.
Bracket Orders – A bracket order is more advanced and works mostly for intraday trading. It combines three orders into one – buy, stop-loss, and target. The trader puts in a limit order for a crypto asset at their chosen price and then “brackets” their exit strategy right after the execution. Bracket orders enable you to simultaneously protect your position against adverse movements with the stop order and lock in upside profits with the profit target order.
Indicators and TA Tools at Crypto Brokers
The brokers on the list we have compiled for you all offer a comprehensive range of tools for technical analysis (TA). Armed with these tools, you can adequately analyze the crypto market and obtain valuable insights into the potential price fluctuations in the future through historical data and past price patterns.
Oscillators – These are chart indicators that assist you in identifying when a given crypto asset is oversold or overbought. The movements of an oscillator are tied to upper and lower limits. After it reaches these limits, the oscillator starts sending oversold and overbought signals.
Moving Averages – Moving averages are another useful tool for technical analysis, assisting you in the trend directions of crypto assets. An MA indicator uses historical prices for this purpose. It also sifts out the noise from arbitrary short-term movements to level out price trends. The two main types of moving averages include the exponential moving average and the simple moving average.
Support and Resistance Levels – Support and resistance levels enable you to obtain valuable insights into the intensity of price trends. Resistance levels represent the points where the prices usually cease increasing and start sinking back down. The support levels do the opposite as they represent the areas where the prices typically cease dropping and start recovering.
Trend Lines – Crypto traders draw trend lines on charts to link certain data points to simplify things. Trend lines allow them to easily visualize fluctuations and spot trends. They resemble support and resistance levels, but the chartist draws diagonal lines rather than horizontal ones. The more slanted the line, the more pronounced the trend.
Crypto Brokers Platforms
Crypto brokers use either third-party or proprietary software platforms to facilitate cryptocurrency trades. Each in-house platform is unique in terms of functionality and range of features, so you should create demo accounts with each broker to draw adequate comparisons. As for third-party software, the most widespread options include MT4, MT5, and cTrader.
MetaTrader 4 (MT4) is the preferred platform of many retail traders and has cemented its position as the most broadly used trading software in the world. You can utilize MT4 to trade various assets and financial products, including decentralized currencies like Ethereum, Bitcoin, and Ripple. MT4 facilitates auto trading and offers an extensive technical indicator library.
MetaTrader 5 (MT5) outperforms its predecessor in the features department, offering more order types, timeframes, technical indicators, and unlimited signals. The platform allows for an improved trading experience but is less suitable for beginners – they might find the great number of features overwhelming.
cTrader is courtesy of Spotware Systems and copy trading is its main claim to fame. With this feature, you can follow high-performing traders and automatically open their positions in your portfolio. The platform also supports one-click trading, level II pricing, detachable charts, and a cryptocurrency market screener that enables you to find the best coins to invest in.
Fees at Cryptocurrency Brokers
While cost-effective, cryptocurrency trading is still associated with some fees. You might want to check these out before you register a live account with a given broker as they can eat up your profits if you are not careful. In what follows, we briefly cover the four most widespread fees you can anticipate when trading with crypto brokers.
The spread reflects the difference between the buy and sell prices quoted by a broker. The greater the spread, the higher the transaction costs you will incur.
Overnight Funding Charges
When trading cryptocurrency CFDs, you can anticipate additional fees if your leveraged positions remain open after the end of the international trading day. Known as rollover or overnight funding charges, these rates are influenced by various factors, including the direction of your position, the current interest rates, and the price movements during the respective day.
Guaranteed Stop Order Fees
These charges are in place if you subscribe for guaranteed stop loss orders. They work similarly to regular stop losses, the only difference being they close out your trades at your chosen price despite the market volatility. You have to pay a premium to use them and your broker will refund you in case the order does not trigger.
Some brokers levy monthly inactivity fees on traders who do not access their live accounts for a given period, usually three to twelve consecutive months. The fees usually range from $5 to $10 per month, depending on the crypto broker. You can easily avoid them by logging into your live account every once in a while.
Who Regulates Crypto Brokers?
Broker regulations are crucial as they guarantee you are trading with companies that stick to the highest business standards, safeguard your interests, and provide you with various financial protections. At BestBrokers.com, we exercise due diligence when researching the legal background of the crypto trading sites we hand-pick for our recommendations list. All brokers approved by our team carry licenses from one or more of the following elite regulators:
- The Securities and Exchange Commission of Cyprus (CySEC licenses are recognized across the European Union and the European Economic Area)
- The Securities Commission of the Bahamas (SCB)
- The Australian Securities and Investments Commission (ASIC)
- The Financial Conduct Authority of Great Britain (FCA)
- The Financial Services Agency of Japan (FSA Japan)
- The Financial Sector Conduct Authority of South Africa (FSCA)
- The Federal Financial Supervisory Authority of Germany (BaFin)
- The Financial Market Supervisory Authority of Switzerland (FINMA)
- The Financial Services Authority of the Seychelles (FSA Seychelles)
Countries That Restrict or Prohibit Cryptocurrencies
Despite exploding in popularity over the past few years, crypto transactions and trading are restricted or fully illegal in some countries. The restrictions often result from fear, lack of oversight, and absence of regulatory recourse. The decentralized nature of these virtual assets is a double-edged sword. It makes them a great tool in the hands of criminals and individuals who seek to bypass capital control measures.
Bolivia – Bolivia prohibits the implementation, purchase, and commercialization of cryptocurrencies under Board Resolution 144 of 2020, issued by its central bank. The BCB cited their high volatility, fraud vulnerability, and unreliable nature as the main reasons for its decision.
China – China hit the headlines in 2021 after the government declared all crypto-asset transactions are illegal in the People’s Republic. According to the country’s central bank, virtual currencies pose a serious threat to the security of people’s assets. Some locals ignore the ban and continue to trade cryptocurrencies through foreign platforms and exchanges.
Vietnam – Vietnam’s legislation does not recognize decentralized currencies as legal tender or assets. Individuals who implement, issue, or supply them are liable for monetary penalties and imprisonment. With that said, trading or investing in crypto is not illegal. Such activities go unregulated and the authorities tolerate them for the time being.
Egypt – The Egyptian advisory body Dar al-Ifta outlawed crypto-related transactions, decrying them as “haram”, or forbidden activities, in 2018. Trading, promoting, and issuing cryptocurrencies are prohibited under Law № 194 and the Central Bank and Banking System Law.
Qatar – In 2018, the Qatari authorities warned local banks and financial firms against dealing with cryptocurrencies and threatened the violators with penalties. Things escalated further in 2021 when the Qatar Financial Center was prohibited from engaging in crypto-related activities, including trading and exchanging crypto for fiat currencies.
Common Q&A about Crypto Brokers
Indeed you can. Many of the trading sites BestBrokers.com has hand-picked offer crypto CFDs, allowing you to leverage your crypto trades and inflate the size of your positions with borrowed capital. Pay attention to the word “borrowed”, though. A swift price movement, which is common with cryptocurrencies, can lead to losses that exceed your initial investment.
The leverage caps available to retail clients are jurisdiction-specific. If you reside in Australia or the European Union, the maximum leverage ratio for crypto derivatives will be 2:1. The caps are proportionate to the level of risk associated with trading a given asset. Cryptocurrencies are hugely volatile, hence the lower leverage maximum.
Crypto trading is legal in many countries worldwide with few exceptions. Some of the most prominent examples include the People’s Republic of China, Egypt, and Qatar. In certain cases, investing in such decentralized currencies is legal but leveraged derivatives like the CFDs are not. The US is an example.
The short answer is yes. Crypto exchanges allow you to purchase coins, in which case you fully own them. Crypto brokers mostly act as intermediaries, allowing you to trade and speculate on the price fluctuations of these coins. Also, brokerages are subject to more rigorous scrutiny as they deal with fiat-based products as well. Crypto exchanges are still in a gray zone from a regulatory perspective.
Many brokers add cryptocurrencies to their product range to meet the needs of day traders looking to profit from short-term price fluctuations. The high volatility of crypto assets results in more small trading opportunities for short-term and algorithmic traders.