Important Tips To Select A Safe Cryptocurrency Exchange

Cryptocurrency is digital currency. There are a number of cryptocurrencies like bitcoin and altcoin. Since cryptocurrency is virtual currency, it is not controlled by any central authority or government. The platform where the cryptocurrencies are traded is known as the cryptocurrency exchange.

The cryptocurrency works on Block chain technology. This technology enables the storage of all the transactions conducted using a particular cryptocurrency. However, the absence of a central regulating authority makes it risky to trade in these cryptocurrencies.  The prices are vulnerable to huge fluctuations based on the supply and demand forces in the market. It is essential to choose the right cryptocurrency exchange to stay safe. Here are some tips from Leonardo Gonzalez Dellan to select the right exchange for trading in cryptocurrencies.

  • Before selecting a cryptocurrency exchange, know about the country in which it is registered. This will help you to determine the law under which the exchange is working. Choose a country with stringent regulations. Leonardo Gonzalez Dellan, suggests exchanges registered under the EU law.
  • The next step is to study the registration process of a cryptocurrency exchange. Observe what information the exchange asks from its investors to complete the registration process. Know about the ID proofs and verifications conducted by the exchange.
  • Enquire about the AML and EDD policies of the exchange. The AML or the Anti Money laundering policy ensures that the money in the exchange is clean. The Enhanced due diligence policy or the EDD policy of the exchange ensures that the exchange is keen to conduct due diligence in case of any sensitive activities. These two policies helps you to assess the intentions of the exchange. An exchange with proper AML and EDD policies is keen to protect the interests of the investors and is sure to be in business for the long run.
  • The last rule advocated by Leonardo Gonzalez Dellan is to study the proportion of hot and cold storage of the exchange. Hot storage refers to the online fund whereas offline storage refers to offline fund. Do not choose an exchange which has more than ninety percent of cold storage.

Follow these four important guidelines from Leonardo Gonzalez Dellan and select the right cryptocurrency exchange to trade safely.