Earnity’s Dan Schatt on Cryptocurrency Exchanges
Earnity is the world’s first community-based crypto platform and marketplace led by fintech veteran Dan Schatt. The San Mateo, California-based Earnity is working on a highly secure and easy-to-use platform for buying, selling, and holding crypto and DeFi assets. To help newcomers in the crypto community, Earnity’s Dan Schatt discusses essential points about virtual currency. This post explores crypto exchanges.
An explosive growth
The cryptocurrency industry is a burgeoning new sector that has seen exponential growth in recent years. Cryptocurrencies are digital or virtual tokens that employ cryptography for securing transactions and controlling the creation of new units. Created in 2009 was Bitcoin, the first and most well-known cryptocurrency. The industry is still in its early stages and is highly volatile. Prices of cryptocurrencies can fluctuate wildly, and scams and hacks have plagued the industry. Nevertheless, the sector has attracted significant profits from buyers and entrepreneurs and continues to overgrow.
A huge part of the cryptocurrency industry is crypto exchanges.
A crypto exchange is a dedicated platform where users can buy, sell or exchange cryptocurrencies. These exchanges typically have a user-friendly interface and may offer features such as a wallet, charting tools, and market analysis. Some exchanges also allow users to exchange or lend and borrow. Crypto exchanges are popular among buyers and parties who want to make money from the volatile cryptocurrency market. However, they can be risky due to the lack of regulation and security measures.
The need for caution
Crypto exchanges usually charge a fee for each transaction. The most common type of fee is the maker-taker fee, which charges a fee for buying (making) and selling (taking) orders. Some exchanges also charge deposit and withdrawal fees. It is important to compare the fees of different exchanges before choosing one to use.
The downside is that these platforms are subject to hacks and scams. In May 2019, Binance, the largest crypto exchange by transaction volume, was hacked and lost 7,000 BTC (worth over $40 million at the time). This highlights the need for caution when using these platforms. Users should always store their cryptocurrencies in a secure wallet such as a hardware wallet.