Steemit CryptoAcademy Contest/S1W2 -Reviewing Centralized Exchanges by @farooq2923

Bitcoin, ethereum and almost all the cryptocurrencies remaining everyday in the headline and in the newspapers. With the passage of time number of people joining crypto currency are incredibly increasing. Everybody wants to know how do I get cryptocurrency, so here I will tell you that we can get cryptocurrency through the Crypto currency exchange.

Cryptocurrency exchanges are websites where you can buy , sell or exchange cryptocurrency for other digital currency or traditional currency like us dollar or euro. Exchange is the place where a buyer and the seller can connect with each other and conduct their work. Real exchanges are just a medium between the traders. The exchange will match buyers and sellers when condition of both buyer and seller are met.

There are two types of cryptocurrency exchange

• Traditional crypto currency exchange such as coinbase these are called centralized exchange. It means that you know your funds aren't kept on the exchange, it's governed.
• Other type of exchange is decentralized exchange that leverage more benefits of blockchain technology to add some additional security to our trading setup.

Centralized crypto currency exchange

Centralized crypto currency exchange is among the essential transacting vehicles for most of the digital currency investors. Centralized crypto currency exchange refers to online platforms used in the purchase and sale of cryptocurrencies. They are the most popular means that most investors use in the buying and selling of cryptocurrency holdings. When we are talking about the centralized exchange it means that we have to trust someone for our money. The word centralized was firstly given to the institution that manage their finances.

To be centralized simply means that there is a trusted middleman who will handle whatever assets that may be in the trade. For example a customer can decide to give a bank their money to hold it for them, the institution will now be in full control of the customer money. In many aspect this will be much safer than the person getting a way manage them personally. Banks have security and teams to keep money safe. They can offer several service such as loan.

So the centralized exchanges are also the same as above, where we can can store our money and as it is centralized system so our assets will be in control of exchange system. Although the middle man trust will make it a lot easier for the customer to recover their password if they have lost it. This will help in taking the pressure of being in full control of their assets off the customer. Some of the centralized exchange include Poloniex, binnance, coinbase, Huobi global and kucoin etc.

Benefits of Centralized crypto exchange

Following are the benefits of using centralized cryptocurrency exchanges.

• Sell cryptocurrency to fiat and deposit into bank.
• Vetting process for listing coin and token.
• Recovery possible
• Centralized crypto exchange offer beginners a familiar, friendly way of trading and investing on cryptocurrency.
• Centralized exchange offers an extra layer of security and relatability when it comes to transaction and trading.

What do you look out for when choosing an exchange to trade your crypto assest?

There will always be a new centralized cryptocurrency exchange almost all the time, however not all will be successful and it is not uncommon for such exchanges to close down failure and success of any exchange depends upon a number of factors which we have to look before joining the Crypto currency exchange.

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Trading volume

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Trading volume is a critical component of the success, the higher the trading volume levels the lower the volatility and manipulation of the market that is most likely to occur on a particular exchange. Volatility is an important consideration due to the time it takes for any transaction to be completed. The cost of the given coin or token can change between the moment the transaction is initiated and the time it is completed.

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Security

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Security is the other important element that we need to kept in mind during the selection of the Crypto currency exchange. Although there is no exchange that is immune to any malicious activity such as hacks, there are some which are more safer. So we should always chose an exchange which gives more security to our assets.

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Fiat/Cryptocurrency pairs

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It is common for any centralized exchange to provide cryptocurrency pairing at this particular point. This will enable customer to trade ,for example trading bitcoin for ether tokens. Very few exchange that offers fiat currency or cryptocurrency pairs, which allow, for example Bitcoin to USD exchange.

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Trading fee

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When chosing a cryptocurrency exchange for trading we should also need to know about its trading fees. If the fees is too high then we should chose alternative exchange for trading. The information about fee of the exchange is present on the websites.We must have an idea about the withdraw fee deposit fee of the exchange where we want to make our trade. Fees can be differ substantially depending on the exchange you use.

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Payment methods.

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What payment methods available on the exchange? Weather these are debit card, credit card or anything else. If n exchange has limited payment options than it may not be suitable for us to use.

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Review your favorite centralized exchange and explain its unique features

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There are large number of cryptocurrency exchanges are present such as kucoin,coinbase, kraken, binnance, Huobi global etc. All has its own pro's and coin's . The exchange I like the most is Binnance exchange because I am working on the binnance almost from 2 years. It is quick and quite easy to use. Binnance was first introduced in 2017 and it was designed by Changbang zhao who was an Chinese- Canadian citizen. Binnance is the world largest cryptocurrency exchange. There are almost 450 trading pairs and more than 150 coin and toekn are present in binnance.

Here is the simple interface of Binnance Exchange. Here we can see the price of leading crypto currency such as Bitcoin, Ethereum etc.

• Here are the coins that are making increase in their price and we can see the percentage increase in the price as well.

• Here we have the coin that are loosing their price from the yesterday price and it can also be seen with percentage.

• In the last we can see the 24 hours volume of the certain cryptocurrency on binnance exchange.

There is P2P channel is also present in binnance exchange from where we can buy or sell the cryptocurrency. In binnance exchange there is also a reward system. We can get the reward by just completing the task given to us. There is also rewards for referencing to other binnance exchange user.

We can do spot trading Margin trading and also future trading on the binnance exchange.

• Here in case of future trading we can trade more than the assets we have in our account by setting leverage.

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Unique Features

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• Binnance is already trading at the highest volume of any exchange
• Binnance is so much popular that most of the alt coin moves to binnance exchange after its ICO.
• The second level verification allows for 100 bitcoin withdrawal. While level one allow less than two bitcoins withdrawal in a day.
• Binnance Exchange only launched the crypto currency pairs that exits in real and also that has strong project behind it.
• Binnance also have low transaction fee and we can get even more discount when we pay the trading fee with BNB.
  

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Is there anything about your favorite exchange you will like to be changed? Discuss

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• The first thing I want to change is about the launching of the crypto currency coin or token. I have seen that binnance exchange launched the token or coin very late as compared to other exchanges, so this must be change and Binnance also launched the coin early just like other exchanges.

• There is also an issue of suspension of withdraw or deposit which least for many days such as in recent case of steem binnance deposit was suspended for almost whole week and now the same case is with withdraw of steem. So this must be addressed and change immediately.

• Binnance as did not accept the fiat currency method such as PayPal or bank transfer, so this should also change and Binnance authority should take action to accept the traditional currency.

• Binnance should also improve its customer service. It takes very long to respond to the customer who is in real worry and its account verification should also be simple.

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What shortcomings do you see on centralized exchanges and how do you think user funds can be protected since we don’t have access to our wallet private keys?

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• In case of centralized system there is always a middle man is present so user does not have complete access to the assets in case of centralized system.

• Centralized exchange are at more risk of hacking as these are operated by different companies and people.

• There is also an issue of transaction fee in different centralized exchanges which too much high.

• In most of exchange such as binnance there is also a great issue of account verification. This is very troublesome for beginners.

• We can protect our assets by making our security system strong that includes the 2FA verification. This includes the verification through google authentication, message verification, email confirmation and security key verification. This can help us to secure our account and we can also protect our account from the hackers.

Conclusion
So in this steemit engagement challenge today I wrote about the centralized exchange system. In centralized exchange system there is a middle man is present which act as medium between the buyer and the seller. Then I told about the benefits of Centralized crypto currency exchange and then about my favorite exchange which I am using since 2 years ago. After that some improvements as well as some short coming in the binnance exchange was highlighted.