Poloniex’s high trading volume helps it routinely rank among the top 50 most popular crypto exchanges in the world. However, it’s definitely not for everyone. Read on to get the latest scoop on Poloniex and learn about other similar exchanges.
Editor’s note: This article was updated to reflect Poloniex’s reduced fees and the addition of support for Circle-backed stablecoin USDC.
Poloniex’s Major Advantages and Disadvantages
Just in case you’re not familiar with Poloniex, here’s a quick rundown of the crypto exchange’s major upsides and downsides.
- Low fees. Poloniex’s fees are cheap compared to most other exchanges that support fiat deposits and withdrawals, debit/credit card payments and other similar features. High volume traders can enjoy commission fee discounts.
- Peer-to-peer lending. Poloniex is one of just a handful of exchanges that supports peer-to-peer lending. Those low fees and advanced features make Poloniex attractive to frequent traders.
- Altcoins galore. Another positive aspect of this exchange is its deep support for altcoins. Poloniex traders can buy and sell over 60 different cryptocoins.
- USDC support. USDC is a new stablecoin that’s backed by crypto finance company Circle. It allows Poloniex users to easily turn their USD funds into tokens that can be traded on the Poloneix exchange.
- Customer support issues. Like most of the major crypto exchanges, Poloniex experienced a rush of new users when the price of bitcoin blasted past $20,000 last year. That surge caused tech support slowdowns and intermittent website problems. Though Poloniex seems to have caught up with the backlog, the exchange still only offers bare bones customer service options.
- Notoriously buggy. Poloniex suffered a major setback four years ago, when a trader discovered an embarrassing vulnerability that allowed one of its users to loot the exchange by rapidly mashing the “withdrawal” button. However, Circle Internet Financial– Poloniex’s new owners— has promised to revamp the site and get rid of the glitches.
Other Pure Crypto Exchanges
The exchanges listed below are similar to Poloniex in that they offer low fees and unique features, but also don’t support credit card buys or fiat bank transfers.
Binance’s speciality is altcoins. With over 100 cryptos, Binance supports more coins than Poloniex. This makes it an excellent exchange to use if you plan on investing in rare emerging coins. Another attractive thing about this exchange is its stellar security record. Despite routinely ranking among the top three largest exchanges by volume, Binance has never been hacked.
On the other hand, though Binance’s commission fees are also quite low, the exchange doesn’t offer discounts to frequent traders. In addition, Binance’s customer support is just as basic as Poloniex’s– and the English version of its website contains only a small number of poorly written guides and how-tos. Another disadvantage to Binance is that it doesn’t offer support for peer-to-peer lending or margin trading.
With support for futures and derivatives trading, BitMEX offers even more advanced features than Poloniex. Traders willing to take on the risk can borrow up to 100 times the amount that they have in their accounts. And like Binance, BitMEX has an excellent security record and has never been hacked.
The major disadvantage to BitMEX is that BitMEX users can only buy futures contracts for a handful of coins. The list of supported coins includes bitcoin, bitcoin cash, cardano, ethereum, litecoin and ripple.its lack of US availability. In addition, US residents can’t use BitMEX, but residents of nearly other country in the world can.
With more than 400 supported coins, New Zealand-based Cryptopia has worldwide availability and offers more coins than Binance, BitMEX and Poloniex combined. Even though Cryptopia’s liberal coin listing policy benefits purveyors of fraudulent coins, a unique coin rating system helps investors identify promising cryptos and avoid the scammy ones.
The main downside to Cryptopia is its small size and corresponding low trade volume. Another issue is that, even though Cryptopia does list hundreds of coins, it also delists coins on a more regular basis than other exchanges. After Cryptopia deslists a coin, it’s customers have a limited amount of time (typically one month) to sell it or move it to another wallet. If they don’t react before the deadline, their holdings get liquidated.
Popular Crypto Exchanges That Support Fiat Currency
All the exchanges in this section are high volume international crypto platforms with excellent security records. Because these exchanges have so many customers, they can afford to offer fiat bank transfers, credit card buys and other attractive (and expensive) features. However, their menu of supported coins is much smaller compared to the pure crypto exchanges listed above.
Kraken founder Jesse Powell became inspired to start his own exchange in 2014 after he was called in to help the badly managed Mt. Gox recover from its devastating hack. Powell is an expert in the area of virtual currencies, international payments and fraud. He was an advisor for Ripple and a number of other high profile cryptocurrency projects.
Powell’s exchange offers a mix of attractive features, including low withdrawal fees, a quick automated ID verification service, margin trading and support for bitcoin and several major altcoins including bitcoin cash, dash, eos, gnosis, tether, ethereum classic, ethereum, iconomi, litecoin, melon, augur, dogecoin, stellar, monero, zcash and ripple. In addition, Kraken has better support documentation than most other crypto exchanges.
On the other hand, Kraken lacks an Android app and its iPhone app is notoriously buggy. Another downside is that Kraken doesn’t support credit or debit card purchases.
Coinbase is similar to Kraken in that it’s a high profile exchange with tight security and support for fiat withdrawals and deposits. But with its top-rated mobile apps, Coinbase provides better tools for managing crypto assets on the go than most other exchanges. An automated ID verification tool makes Coinbase easy to use, and its sister exchange Coinbase Pro lets frequent traders enjoy reduced fees and use advanced features like customizable order types and real-time charts.
However, margin trading is not available on Coinbase Pro. As a result, there is no way to leverage your gains if you have limited funds in your account. In addition, crucial features are locked down in some states and countries. For example, Coinbase users that are based in Canada can only use fiat to buy cryptocoins. Coinbase won’t let Canadians exchange their crypto assets for fiat.
London-based Bitstamp offers a key feature that no exchange we’ve covered so far provides– credit card buys. Bitstamp users can use their Visa and Mastercard credit and debit cards to fund their accounts. They can also use bank transfers to make deposits and withdrawals.
Bitstamp’s reputation was tarnished when it endured a high profile hack in 2015. Fortunately, customers were not affected and Bitstamp has not been hacked since it tightened its security following the breach. Another Bitstamp downside is the fact that it only lists a handful of coins. Bitstamp only supports bitcoin, ripple, litecoin, ether and bitcoin cash.
One of the most interesting things about China’s massively popular crypto exchange is OKEx’s unique integrated peer-to-peer market. OKEx users get a convenient way to trade fiat for crypto with each other, and vice versa.
In 2017, a group of OKEx users were hacked, but the only reason the thieves succeeded was that the users had failed to set up 2FA (two-factor authentication) according to OKEx.
Decentralized crypto exchanges
Most decentralized exchanges are pure crypto exchanges that don’t accept any type of fiat deposits or payments. What they offer is anonymous trading, worldwide availability and support for a wide variety of altcoins.
“Cypherpunks” appreciate that decentralized crypto exchanges are nearly impossible for governments to regulate or control. In addition, the fact that decentralized crypto exchanges run on distributed networks means that they are harder to hack compared to their centralized counterparts.
Bisq– formerly known as Bitsquare– is one of the oldest and most well-known decentralized exchanges. Bisq is the brainchild of crypto pioneer Manfred Karrer, an Austrian developer whose involvement with the bitcoin community dates back to 2011.
Though over 70 altcoins can be traded via Bisq, perhaps the most interesting thing about this unique platform is that it’s a decentralized exchange that supports fiat currencies. Like LocalBitcoins and other similar peer-to-peer exchanges, Bisq users can buy and sell bitcoin using any fiat currency via Bisq’s built-in marketplace.
Despite all of the benefits outlined above, Bisq has so far failed to become a major exchange. The way that Bisq calculates commission rates– with a complicated equation involving multiple variables and weighted fees– has made it difficult to predict the cost of doing business on the Bisq network.
The BitShares DEX is another well-known crypto platform that falls into the decentralized exchange category. Like other decentralized exchanges, this one’s core features include worldwide availability and built-in anonymity. Interestingly, BitShares DEX users can short sell various cryptocoins by trading so-called “smartcoins”– tokens that are pegged to the value of four major cryptocurrencies.
Aside from the smartcoins feature, BitShares DEX is somewhat bare bones compared to Bisq. One reason why BitShares DEX development seems to be in a rut may be that its founder Dan Larimer moved onto a new project (the blockchain-based social media platform Steemit) shortly after BitShares launched.
Eight more decentralized crypto exchanges
The following projects aren’t as well known as Bisq and BitShares DEX, but they are worth exploring if you’re interested in decentralized exchanges.
- BarterDEX. BarterDEX’s core feature is atomic swaps. Atomic swaps allow BarterDEX users to trade cryptocoins without the use of an escrow system.
- Cryptobridge. Cryptobridge was developed to appeal to the needs of altcoin traders. Its BridgeCoin Profit Staking Coin allows Cryptobridge users to share in its success.
- IDEX. IDEX is “the only decentralized exchange with real-time, high-throughput trading,” according to its website.
- Oasis Direct. Like most decentralized exchanges, Oasis Direct is still a work-in-progress. Its developers describe it as a “fluid, fast, and instant way to get DAI/MKR.”
- OpenLedger. This Denmark-based decentralized exchange is similar to BitShares. It supports far more coins, though– over 125 different cryptos, in all.
- Radar Relay. Radar Relay raised eyebrows last year when its founders raised $3 million from venture capital investors. Its founders describe it as “a non-custodial and peer-to-peer relayer built on top of the 0x protocol.”
- Stellar. Steller is an interesting cryptocoin / decentralized exchange hybrid. The Stellar DEX is built right into the coin’s protocol.
- Waves. The creators of Waves call it “the fastest blockchain in the world.” Waves DEX users can trade bitcoin, ether, litecoin, zcash and several other altcoins.
More Solid Alternatives to Poloniex
CEX.IO is a lesser-known European exchange that’s also available in around 20 American states. It has an excellent security track record and offers interesting features including inexpensive bank transfers and support for credit and debit cards. Despite the fact that CEX.IO is somewhat unknown outside of Europe, it could gain more customers if it manages to expand into additional markets.
Like Poloniex, ShapeShift’s speciality is altcoins, but its underlying structure is totally different. Poloniex users store their funds in wallets, which Poloniex hosts on its servers. ShapeShift, on the other hand, is a non-custodial exchange. In other words, it doesn’t store its customers’ funds.
Because ShapeShift relies on other crypto exchanges to process its users’ orders, it’s more like a cryptocurrency service than it is a true exchange. The convenient thing about ShapeShift is that it automates the nitty gritty process of trading one cryptocoin for another. But that convenience comes with a price. ShapeShift only offers “profitable” exchange rates to its users. This enables the exchange to make a small profit (roughly 0.5%) every time it processes a transaction.