What are cryptocurrency exchanges and how do they work?

[CorrySanders12]

With all the advantages of bitcoin, its basic wallets have a significant drawback - they only allow you to work with bitcoin. Exchange it for other digital currencies, convert it into dollars, rubles or any other currency Bitcoin Core, Electrum and other wallets are not capable of.

And as soon as the price and turnover of the cryptocurrency market reached billions of dollars in dollar terms, hundreds of exchange exchanges appeared. For example, you can exchange cryptocurrencies on the website letsexchange.io .

Organization of a cryptocurrency exchange
A cryptocurrency exchange as an information product consists of computer hardware and software. The software shell registers a user and creates an account, where he replenishes his digital and fiat accounts or withdraws money, places buy and sell orders. Many exchanges provide additional functions - chat, news feed, rate analytics, etc.

The hardware part is represented by servers on which operations are performed and data about users, their accounts, and transactions carried out by them are stored.

Working with a cryptocurrency exchange - creating an account and replenishing an account
Registration on exchanges is free of charge and is not difficult for an experienced Internet user. You need to enter an arbitrary name, come up with a password, and most exchanges require an e-mail address. But if you don't want to light up your personal mailbox, make a new one.

On some exchanges, users are divided into several levels, and verification is required to increase, including sending passport data and document scans. At the same time, anonymity is lost, but the user has more trading operations, ways to deposit and withdraw money.

There are two ways to fund cryptocurrency accounts. The first is to transfer bitcoins or other digital coins from your account addresses (wallet number) to the address that the exchange will indicate to you.

Or, if you don't have bitcoin wallets, top up your accounts in regular currency, and buy BTC or altcoins on them on the exchange.

Each exchange has its own list of options for replenishing the balance with regular money and withdrawing funds. To a large extent, this list determines the circle of her clients - people choose such exchanges to which it is more convenient to transfer money.

The exchange itself is a platform where everyone puts up lots for the purchase or sale of cryptocurrency at any price, including one that differs from the market price, and then you just have to choose the most advantageous offer.

How cryptocurrency exchanges make money and how you can make money on the exchange yourself
The main source of income for cryptocurrency exchanges is commissions for each transaction, as well as for withdrawing funds. Commissions for a transaction are tenths of a percent, because it is important for exchanges that many transactions are made. Withdrawing funds will cost more, 2-3 percent.

However, it is more important for clients to make money on the cryptocurrency exchange themselves. And the main source of income is the high volatility of cryptocurrency rates, daily fluctuations are 10 percent or more, which opens up wide opportunities for traders.
You can play both at rates to common currencies and on relative fluctuations of digital coins: for example, bitcoin / ether pairs, or litecoin / dash. The more options a particular exchange offers, the better.

The trading process itself is simple - you need to place an order for a specific amount and indicate the rate at which you want to buy or sell. As soon as a person appears who agrees to the deal, it is immediately concluded. The main thing is to guess where the courses will go. Those currencies that are growing must be urgently bought. Sell ​​what falls. A decent start-up capital is required for a solid income, however, some exchanges offer leverage. Then you will earn significant amounts with a small balance, but if you make a mistake with the trend, you will lose everything.
Another way to make money is cryptocurrency arbitrage. With accounts on different exchanges, you can buy digital coins where they are cheaper, then transfer and sell on another site at a higher price.

[Fabregas]

Hello, cryptocurrencies have come a long way and created their own economic sector, however fiat still rules the global financial market. Cryptocurrency is not yet possible to pay for most goods and services. Therefore, people constantly need to convert cryptocurrency into ordinary money for household expenses. However, there is a huge variety of crypto wallets and exchanges on the market, which is why choosing the right option may not be the easiest. Personally, I use the service at https://cryptocto.com/, which is currently in high demand.