Cryptocurrency exchanges are one of the least talked about parts of cryptocurrency; however, they can be one of the most critical parts of your crypto journey. The same way you’d use an online casino app to access games is the same way you’d need a crypto exchange.
Come with us as we unpack what’s really going on with crypto exchanges in the UK.
What are crypto exchanges in the UK?
Before we look at what’s happening with crypto exchanges, we need to have a fundamental understanding of what cryptocurrency exchanges are. A cryptocurrency exchange is an online platform or business that deals with and allows customers to trade cryptocurrencies or other digital currencies for other assets. This can be traditional fiat currencies or any other digital currency.
To simplify this idea, let’s consider our usual way of banking. For many of us, the traditional ways of banking have been replaced with online banking. When we think of cryptocurrency, we need to think of our banking apps that offer us the chance to control our money by allowing us to make transactions, approve payments, and many more. Cryptocurrency exchanges are simply a means to an end, and like our banks, they charge a fee for their services.
Cryptocurrency exchanges in the UK
Now that we have a rough idea of what we’re dealing with, we can try to break down the concept of cryptocurrency exchanges in the UK. Before we go any further, it’s important to remember that cryptocurrency and the use of crypto exchanges are legal. It also means that there is little regulation on the use of cryptocurrency and its platforms in the UK. The only catch is that all crypto businesses or platforms providing service need to be registered and approved with the FCA.
In its nature, cryptocurrency is perceived as a threat to traditional banking methods. Yes, many countries have tried to adapt the use of blockchain technology to traditional banking methods; however, its threat is still genuine. Cryptocurrency is also known for its ability to act as a tool for money laundering, which is why many countries tend to shy away from it. For this reason, many countries tend to ask that crypto exchanges abide by anti-money laundering rules and regulations, and the UK is no different.
Businesses providing services in the cryptocurrency field need to ensure that they are registered and approved by the FCA. The FCA, which is simply the Financial Conduct Authority, is a financial regulatory body in the UK. It’s important to know that the FCA is an independent body from the UK government. They generate profits by charging their members a fee for their services. The company was founded in April 2013 and only has jurisdiction in the United Kingdom.
What to look for in a crypto exchange platform in the UK
When we’re looking for good crypto exchanges within the market, there are certain things we need to look out for. Below we take a glance at some of the things you may need to consider when considering going with a particular crypto exchange platform.
License
Before we venture into anything with any crypto exchange platform, we must ensure they have a license and are registered with all the necessary platforms. The issue of money and investments is sensitive, so you always need to make sure that you invest or give yours to a platform you can trust. Building that trust starts with the platform having a license to show that the necessary parties have vetted them.
Variety
When dealing with things like cryptocurrency, you will definitely want to make sure that you have various options at your disposal. The cryptocurrency market is highly volatile, making it very easy for things to change. To stay ahead of the curb, you need to make sure that you’re able to jump ship whenever you need to to keep your money safe. It’s better to have options in a big pool so that you have different avenues to run to if there’s ever a crisis.
