Although there is no lack of Bitcoin exchanges available for people who want to invest or trade in BTC, there are a few things you should know before you get started. Transferring your money over to an exchange can be an arduous process at times. Hopefully, it will get easier in the future, but right now it takes a certain degree of thought and planning.
Bitcoins are not easy for people to acquire. If you’re able to objectively evaluate a few things before deciding on one, you might be better off than choosing the exchange that has the best-looking website.
Let’s cycle through some of the characteristics you need to consider when choosing an exchange.
Because Bitcoin is traded on a market where people are both looking to purchase or sell the currency, it’s important to take into account the amount of liquidity that an exchange has. Liquidity is the ability to sell without the price being significantly affected, causing the price to drop. The more buyers and sellers there are, the more liquidity that exists. So, what method can you use to tell how much liquidity an exchange has? One word: volume. Take a look at the top exchanges by trading volume as calculated by Bitcoincharts.