How to Choose the Canadian Crypto Trading Platform That’s Right For You - Part 2
Besides trade commissions, spreads and withdrawal fees, what other factors might a would-be crypto investor look at when choosing a Canadian crypto trading platform?
Evaluate the platform's security measures, including cold storage, multi-signature authentication, and insurance policies. Does the platform just talk a good deal, or have they put their money where their mouth is? If that’s not on their website… Probably safest to look elsewhere.
Assess the platform's trading volume and liquidity to ensure efficient order execution. This alone will determine how large or small your spreads are. For example, part of why NDAX’s spreads are so consistently thin is that NDAX is one of the largest crypto trading platform by volume in Canada. More volume means more liquidity and more liquidity means thinner spreads.
User Interface and User Experience (UI/UX)
Evaluate the platform's ease of use, navigation, and overall user experience. Is the platform optimized for simplicity, transparency and ease of use?
Trading Tools and Features
Assess the availability of advanced trading tools, technical analysis indicators, and market research resources. Do they offer recurring purchases? Do they have a great referral program?
TO THINE OWN SELF BE TRUE
Chances are, if you use online banking, you’re most likely tech-savvy enough to buy Bitcoin or crypto. But even if you doubt your ability, this doesn’t necessarily mean you should seek out the most childish platform available––it’s more likely that you’ll want a platform with amazing customer support. (Beware of companies that rely on cartoonish branding or that treat you like a child! Remember that if you’re not paying for a product, the product is likely you.)
Determine your preferred investment style. Are you the type to invest everything in one lump sum and forget about it, or would you prefer to “dollar cost average (DCA)” by spreading that investment budget out over several months?
Set realistic investment goals and risk tolerance! Don’t invest more than you can afford to not touch for at least 5 years! Since Digital Assets can be very volatile, it would be a shame to have to sell something at a loss because you invested too much upfront and need some of it back.
OTHER CRUCIAL CONSIDERATIONS
Has your Canadian crypto trading platform undergone the Pre-Registration Undertaking (PRU) required by Canadian regulators in 2023? Are they registered with Fintrac? When applicable, are they licensed in Canada as a Money Service Business, or in Québec by Revenu Québec? Canada has historically been quite open to digital assets–if your platform is not registered, that’s a red flag.
Assess the quality and availability of customer support services. What are the reviews telling you about a crypto trading platform’s dedication to making (and keeping) their current customers happy?
Evaluate the availability and functionality of a mobile app for convenient trading on the go… What are other people saying about it on the Apple and Google Play stores? Anything less than 4 stars out of 5 across the board may not be a company with whom you want to entrust your hard-earned crypto. Which brings us to–
Reputation and Trustworthiness
Research the platform's reputation, track record, and user reviews. Has your platform of choice had any public audits performed on their company? If not, that should be a red flag.
Weigh the pros and cons of each platform based on your specific needs. Consider creating a shortlist of potential platforms and conducting further research.
Once you’ve narrowed down your list, choose the platform that feels like the right fit for you. Get your driver's license or passport ready, sign up and fund your account via Interac transfer!
LAST NOTE: ANALOG TO DIGITAL
Moving your ‘monetary value’ from one (banking) system to another (digital) system.
Every monetary system is its own parallel universe for ‘monetary value’, each blockchain its own private silo that may or may not be capable of communicating with other open, public networks (like Bitcoin) or closed, private networks (like CAD, Euro, USD).
Therefore (until you can mine or earn crypto directly), to acquire digital assets, one must transfer their ‘money’ from one network to another, and to bridge these networks, an intermediary is required.
Hence, the Canadian Crypto Trading Platform.
We’ve seen the importance of doing a little due diligence when choosing the right Canadian crypto trading platform for you. We’ve seen the importance of understanding the math behind commissions/fees and spreads over the long haul… And we’ve gone over some of the other factors one should be prepared to research before opening an account with a crypto trading platform.
(As a reminder, we speak about Canadian crypto trading platforms because funding your account is free via Interac. If you want to use an American crypto trading platform, be prepared to pony up an extra 2.5-5% in credit card transaction fees. Should we draw you a picture of what that looks like after 5, 10 or 20 years? :)
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Disclaimer: This article is not intended to provide investment, legal, accounting, tax or any other advice and should not be relied on in that or any other regard. The information contained herein is for information purposes only and is not to be construed as an offer or solicitation for the sale or purchase of cryptocurrencies or otherwise.