You can’t invest in crypto without converting some of your melting-ice-cube-money into crypto.
In other words, you need a way to get your cash into crypto.
The best way to do that is through a trusted crypto exchange.
But, there are dozens of exchanges. But, which exchanges are the best? What are the fees? How do you signup?
Let's jump into it.
Also FYI - DeFi Puma is an affiliate of Kraken Pro and FTX. However, we did not select these exchanges based on affiliate status. For example, Coinbase is not an affiliate but still selected as a best exchange for US residents.
Which exchanges are the best?
I think there are four primary factors to evaluate when choosing an exchange:
- Low fees
- Lots of options
- Trust
- Usability
Based on these criteria, I think the best crypto exchanges for US residents are:
- Kraken - the best exchange for security, never hacked. Kraken takes security very seriously. In fact, employees aren't allowed to even list they work there on their LinkedIn profiles. The only downside to Kraken is that there are less options than some other exchanges.. But, this may be a blessing in disguise because it keeps new users from aping into bad assets. Kraken lists all the major/important assets; including native (i.e., actual) LUNA and UST which are not present on Coinbase or FTX.
- Coinbase - the best exchange for ease of use and lots of options. Coinbase is simple for users and the fees aren't bad. However, they do list way too many s***coins.
- FTX.US - the best exchange for users with financial backgrounds. FTX offers very detailed asset price charts & order books. However, the interface is a bit less intuitive and US residents must use FTX.us (which doesn't list as many assets as the international site FTX.com).
How do I keep the fees low?
There are two primary ways to keep fees low when you are trading on crypto exchanges.
#1 - Trade more volume.
Of course, overall fees increase with increased trading.... but, in percentage terms, fees tend to drop as you do higher amounts of trading in a month.
#2 - Use the Pro version of these exchanges.
This can save you 50% or more on fees!
For example:
- use Kraken Pro instead of Kraken,
- Coinbase Pro instead of Coinbase, and
- FTX.us Pro instead of FTX
How big of a difference is there between the pro versions of the apps and the non-pro versions?
Let's use Coinbase as an example. Unfortunately, the normal Coinbase app doesn’t even list standard trading fees - but a $1,000 of BTC right now would incur a fee of $14.68 (~1.4%). However, Coinbase Pro does list standard fees and the fee for the same trade is currently $6 (or less; dpending on trade type & volume). The difference between Kraken Pro fees and Kraken is even larger — 0.2% vs 1.5% instant buys on Kraken!
How much are the fees?
Crypto exchange fees are often difficult to understand aren't always prominently listed.
With that said, we've done the digging. Here are our rankings along with specifics of the fees across Kraken, Coinbase, and FTX US:
#1 - Kraken Pro:
#2 - FTX US Pro:
#3 - Coinbase Pro:
- Maker Transaction Fees: .25-.60%
- Taker Transaction Fees: .15-.40%
- ACH Fees: free
- Crypto Deposit Fees: free
- Crypto Withdrawals: unclear; appear to be free or negligible
A few things to note:
- The fees listed in the table above are for anyone trading up to $100,000 per month and are current as of March 2022.
- The difference between maker and taker transactions is basically prioritization. Maker transactions are where your order is filled more or less immediately. Taker transactions are where your order is basically added to the order book to increase liquidity depth but not necessarily filled as quickly.
How do I signup?
To signup for any of these crypto exchanges, you'll first need to create a general account with the exchanges.
Step #1 - signup via the following links:
Step #2 - download the pro version of whichever app you chose:
- Kraken Pro - only available via iOS or Android mobile app
- Coinbase Pro - available via iOS or Android app or the web at pro.coinbase.com
- FTX.US Pro - available via iOS or Android app or the web at ftx.us, just don’t use normal FTX app (fornerly Blockfolio)
Step #3 - fund your account & make your first purchases!
You're all set! Enjoy the journey into DeFi.
TLDR
Create an account with a major, US-based crypto exchange to buy your first crypto. Kraken, Coinbase, and FTX.us are the best options. Signup for either FTX.US Pro here, Kraken Pro here, or Coinbase Pro here. Use the pro version of their apps for the lowest fees.
