How Many Cryptocurrency Exchanges are there?

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How Many Cryptocurrency Exchanges are there?

Cryptocurrency exchanges oversee the trading and sometimes valuing of cryptocurrencies, and form an integral part of the industry. There are various types of exchanges, with some being centralised and others decentralised, but their role is almost always the same. The difference lies in the way that transactions are carried out. In this article, we will go over how many crypto exchanges are there and which are the most reputable of them.

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What is the Exact Number of Exchanges Today?

Since crypto regulation in many countries is still either limited or non-existent, there are no rules about setting up a cryptocurrency exchange. Whilst a reputable exchange invests in powerful servers and security features, you can technically create your own exchange online in a surprisingly simple way. Although, creating your exchange is no guarantee that potential investors will use it.

It is difficult to determine the exact number of exchanges at any one moment since these do not need to register with any centralised authority. We estimated 504 cryptocurrency exchanges as of to date, but this can change at any moment. 259 of these exchanges are tracked on CoinMarketCap, while others are still in their start-up period.

According to CMC, we have 18,998 markets in which we can trade crypto. This means that there are 18,998 different trading pairs (ex. USD/BTC or XRP/ETH etc etc.) available on 259 exchange platforms. If we do some simple maths, we can note that on average, an exchange platform has 73 markets for its users to trade in.

Because they are so ‘easy’ to create, many exchanges are set up and then close after little or no interest. Those who are interested in creating an exchange may also opt for a white-label solution. This means that you can buy the architecture of an internationally know exchange and then re-brand it completely and put it on the market, hence start a cryptocurrency business. Crypto users today are more aware of potential frauds so they normally opt for the bigger, more reputable crypto exchanges. A good example of a reputable cryptocurrency exchange is Binance.

Which are some of the Most Reputable Exchanges?

In order to make the list of reputable cryptocurrency exchanges, a platform needs to operate in a safe and secure environment. There are many ways to achieve this, such as by abiding by industry best practices, complying with regulation, and implementing a strong firewall.

Some of the best exchanges also decide to be based in countries that are creating cryptocurrency legislation. By doing this, they can attract cautious traders who prefer dealing with a company that operates within a regulatory framework.

eToro is a great example of a cryptocurrency exchange but there are other popular exchanges such as Binance, which relocated to Malta after the country passed several industry regulations. Binance is one of the largest cryptocurrency exchanges by trading volume and has a great reputation with its customers. Although it was successfully hacked in 2019, no users lost their funds, and this gave the platform a significant boost in its overall reputation.

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Coinbase, an American company licensed to carry out money-based transactions, is another of the most reputable exchanges. The company also has an office in the UK, where it received an e-money license from the FCA, which means that it needs to adhere to strict compliance conditions which make its operations safer. Coinbase is probably best known for allowing the purchase of Bitcoin and Altcoins with PayPal, apart from also accepting card payments and bank transfers.

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Whilst BitMEX has not registered with any legislative board so far, the Hong Kong-based platform has a strong reputation for safety. Specialising in futures and perpetual contract trading, the P2P exchange is best-suited for experienced traders. Newbie investors should have a look at these user-friendly exchanges instead.

Conclusion

It’s hard to answer the question of how many crypto exchanges are there because, with technologies, it’s getting easier to open a crypto exchange. However, a new exchange might not be the best solution as it has not yet passed the security test. We recommend always go with a reputable crypto exchange that has been around for years.

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