What to choose an exchange or crypto exchanger?

Cryptocurrencies appeared not so long ago; by the standards of financial institutions, this is a relatively young area. Therefore, exchangers and exchanges are essentially on equal terms of existence. Which is why there is confusion of terms. What is the difference and what to choose: a crypto exchange or an exchanger? Let's find out in this article.

Crypto exchangers

What is an exchanger – it is a platform through which one can convert one digital asset to another or to fiat money. To complete a transaction, you do not need to take part in trading; exchangers have a fixed rate. Moreover, the price already includes the service commission.

If you rely on the opinion of experienced traders, then you cannot say that exchanges are better than exchangers and vice versa. It all depends on the purpose of use, so the assessment should be based on perspective. For example, exchanges through the Mason-ex service – it's convenient, fast and safe. Therefore, if you don’t have time to deal with the intricacies and nuances of the exchange’s operation and undergo verification, then objectively, the exchanger is the ideal option for you.

If you are a beginner, then it is more convenient to exchange cryptocurrency through services. This platform works quite simply: the user transfers fiat and receives a digital asset.
The main difference from exchanges – This is an opportunity to purchase digital assets without participating in trading. At the same time, the crypto exchanger has great capabilities in accepting payments in fiat currency and cooperation with banks.

You will probably be surprised, but exchangers are divided into several types:

• offline – You leave a request on the website, and during a personal meeting the transaction takes place;

• crypto machines – the principle of operation is the same as with ATMs;

• p2p – some clients publish exchange offers, others choose the most suitable option for them;

• online crypto exchangers – These are the services that are necessary to convert fiat into digital assets.

The last option is the most popular among cryptocurrency lovers.

Despite the obvious advantages, exchangers also have disadvantages:

• Such sites provide a small selection of cryptocurrencies. Usually the most popular coins are in circulation. Of course, you can buy Bitcoin, but here’s something exotic – unlikely.

• Exchange rate – it may differ from the standard exchange one. The crypto exchanger makes money from commissions, which are taken into account in the course.

• Risks – The choice of an exchanger should be approached as seriously as possible. The activities of such services are not regulated by law, so there is a risk of running into scammers.

Thus, we can conclude that crypto exchangers – This is the easiest way to buy cryptocurrency. But in order to make an objective assessment, it is necessary to consider in detail the principles of operation of crypto exchanges.

How crypto exchanges work

Crypto exchanges – These are platforms where users trade, exchange and store digital assets. More advanced platforms offer derivatives trading – options, leveraged tokens and futures.

Crypto exchanges provide a node for conducting transactions between different blockchain networks. The advantage of such a platform is that it allows you to trade cryptocurrency without the participation of intermediaries, which saves money. Many exchanges have p2p services that are necessary for exchanging digital assets. Another feature – This is technical support. As a rule, on crypto exchanges it works 24/7. But even simple exchangers have a 24/7 support service.

Despite all the positive aspects, there are also negative aspects. The main problem – this is a risk of hacker attacks. And this happens often. As a result, users lose their funds. Another serious drawback – this is a liquidity problem. FTX had a very revealing situation – the crypto exchange collapsed, and ex-head Sam Bankman-Fried was sentenced to 25 years in prison for stealing user finances. 

Many traders prefer crypto exchangers for another reason: in order to convert funds on the exchange, they must undergo registration and KYC verification. This is extremely inconvenient for making a quick exchange, since the identification process can take quite a lot of time.

Comparison of exchange and exchanger

The exchange and sale of cryptocurrencies can be carried out both on the exchange and through an exchanger. The choice of method depends on the goals. Let's look at the advantages of the exchange service:

• simple and user-friendly interface that will be understandable even for a beginner;

• no need for registration and verification;

• many exchangers are integrated with payment organizations and provide the opportunity to deposit fiat money in a convenient way;

• conversion of funds is carried out quickly, often automatically;

• exchangers have no restrictions on deposits and withdrawals.

But crypto exchanges also have their advantages, for example, rates and commissions. Exchangers just focus on the rate that exchanges provide and add a percentage to it – commission. Thus, the amount of fees on exchanges is about 0.5-1%. While exchangers charge from 1-5%. 

Conclusion

Converting cryptocurrency through exchange services is very convenient and fast. And in some cases it’s safer than through crypto exchanges. What exactly to choose depends on the needs of the users. If exchange speed is important – then crypto exchangers are better suited for this. If you need to trade derivatives, then you should choose exchanges.