Crypto Exchanges Overview
(Straight from coinlib.io)
The chart on the left show % of crypto trades happening out of the exchanges tracked by coinlib.io. Not sure where Seychelles is but when I googled it here are the results.
It is an island on the east of Africa. I wonder who would be trading crypto there? Must be some of the most richest crypto enthusiast on the planet.
Back to the pie chart, on the right hand is the % of revenue going through the exchange. I have heard of all but BitMEX, which actually has the most amount of crypto revenue traded in the past 24 hours.
Now just me throwing a bone out there but I think BitMEX has some affect on how bitcoin prices has moved lately. Seeing that the exchange almost accounts for a quarter of the daily volume makes its weight in crypto investing significant. Add to it that the exchange mostly trades bitcoin makes me believe that it certainly has some affect on moving bitcoin prices.
To further this theory the exchange is designed to have hefty leverage on trades. Directly from the website it lists bitcoin can be traded with leverage of up to 100x. Wow.
As a somewhat season stock trader I can fully say this type of leverage offered by BitMEX is simply dangerous to play. For newbie traders that are not fully aware of the pitfalls of leverages lets just say any multiple of your initial investment means you will lose your money a lot quicker. Of course the flip side to is if you are right on the trade you make a lot more. The bottom line is this type of leverage trading is only good for those willing to risk what they have to lose or else lose their shirts.
I am studying exchanges because recently I have found that Kucoin exchange lacks liquidity even though it is a centralized exchange. For instance top pair trades on the exchange currently are:
Not what I call thrilling to trade BTC into the other coins that is on the list. Not to say I think those choices are bad, but it is not what I am looking for.
Decentralized versus Centralized
So not one of the top exchanges that are listed in the pie chart is a decentralized exchange. Yet there have been a lot of crypto enthusiasts whom supports and uses only decentralized exchanges. The difference between one that is decentralized first one that is not is in a decentralized exchange no one entitle holds ownership of the exchange and the coins that are on the exchange is held in control by the user.
Before I started learning about crypto trading all I knew was centralized exchanges. That is trade platforms on stocks and bonds only offer centralized trades. Never did I find mention of a way to trade stocks that is personally held only by me to someone else. Then comes crypto and its push for decentralization. That included exchanges that were built to have users store and trade their own coins without a third party. This is a far out idea!
I will update when I have decided on the exchange to use for my future cryptocurrency trading.
Thanks for reading.
Date of Post: 4/7/2018
Past Posts:
Cryptocurrency Downtrend Continues
My Emotions on Crypto
How to pass time when crypto prices are free falling
I just wanted to add something about trading on leverage, not only can you lose all your money very fast, but you could also end up in substantial debt.
If you just buy and hold a currency, then you can only lose what you've invested. If you're trading on margin though, you can quickly get on the wrong side of the trade and not only do you lose all your investment, you end up owing them even more money to cover your defaulted trade. There's no limit to how much you might end up owing in debt.
As @mawit07 says, it's a very dangerous thing to be playing with, so unless you know what you're doing, don't trade on margin.
I think leverage is at the heart of why financial markets have a cycle of up and down. Like what Warren Buffet says, "only when the tide goes out do you discover who is swimming naked."
There will always be a loser in order for there to be a winner. Just do the best I can to avoid being the loser as much as I can :p
lol very true... There's nothing wrong with trading on margin, all my trading is levered but I've been doing it for a long long time. For newbs it's a very tempting idea, a fast way to make easy money, but we know it doesn't work like that. It's just a way to lose your money faster :-)
My advice is to become a successful trader first, and only then consider using leverage.
Both of you are to smart!!! But then again that is why your content rocks
thanks, I'll take the compliment but in my case I think it's the opposite..lol. I've made every single mistake there is to make, and learned from it, so I'd say it comes down to experience more than intelligence :-)