Guide Exchanges

What is an Exchange? In the Bitcoin world, an exchange is an exchange house, and most of them are online, some web pages, with tools for buying – selling cryptocurrencies. Some more basic, some more advanced, some more private, some of nothing, some more secure some of nothing. There is something for everyone. Hundreds of exchange pages. What I try here with this guide is to give you more extensive information about this world and some guidelines that must be followed, IN ORDER NOT TO END UP BEING SCAMMED! Bitcoinland is full of scammers, because they attract them, the easy money obtained and the innocence of newbies. Being knowledgeable, you can easily spot these scammers.

But when choosing any of these “Exchanges” you have to take many factors into account. And they are very important aspects, so I beg you to pay attention. Not everything that is “recommended” out there, from other friends or links shared by chats and groups, are “the best”. Each of these Exchanges try to attract more people inside, because from each one they earn a commission. They do not care if they help you or not from your person. For them the important thing is to “make money”, a lot of money. They are even capable of taking the money, setting up some “hacking” charade and vanishing … with your money.

You can ask now: “But if they are so bad, most of them, why do we use them?” Well, because at the moment not all the people who want to use Bitcoin as money, or simply save in BTC, can earn some BTC directly with their work, there are not many companies and / or systems that can pay you directly in BTC. It starts little by little, some freelancer, some technology company, some that are more advanced on the subject, but there is still a lot of information work needed for these companies that have not yet considered paying their employees in BTC. But it’s all up to us BTC users to train us and then inform others. Knowledge is power.

These Exchanges are practically exchange ramps between two very different worlds: the world of fiat currency and Bitcoinland. And precisely because of this, they must be treated as if they were banks, intermediary banks. So, here, we are going to mention some that have been tested and which meet the minimum privacy and user requirements.

The only one (at the moment), to which we raise an ALERT NOT TO USE Coinbase. I repeat: DO NOT USE COINBASE! It is the worst exchange system, the one that most tracks, blocks, controls its users. From here we tell you: if a “smart friend” recommends Coinbase, because this is NOT your friend … There are many tests and aspects, which are in a special section of NO COINBASE.

When you use an Exchange to buy or sell BTC, you must ALWAYS keep this golden rule in mind: NOT YOUR KEYS = NOT YOUR BITCOINS (you do not control your BTC keys = you do not control your BTC, they are NOT your BTC, Bitcoin is PROPERTY of the one who controls the keys). With this saying, when you use an Exchange, because you use it only for this purchase / sale, NOT to save your BTC there in this account, an Exchange is NOT your wallet, it is a bank that guards your BTC. You enter, you deposit the money to buy, you give it to buy, and then withdraw the BTC to your personal, private wallet. This is all.

Now, we are going to categorize the Exchanges a bit, so that you can make a better choice when using them, according to your own needs and guidelines.

A. P2P exchanges: (P2P = person to person, such as Bitcoin is a P2P currency, without an intermediary in this transaction) those exchanges, which use a direct exchange system between participants, each user puts their direct sale / purchase offer and others choose it from the list, more or less like an auction. The Exchange only acts as an arbitrator, with a system of “escrow” trust. This way they can protect themselves against scammers and everyone is assured that the exchange process is completed correctly.
Now, within this P2P category there are several subtypes of exchanges:

  • Centralized: where there is normally a central web page, which is accessed by users, is a single point of access and which can also be a point of attack by governments, hackers, etc.
  • Decentralized: where there is NO central point of access, there is no central website where everyone enters with their user. Access is done through specific applications that hide your identity and position on the network. There is no central point of attack, it would be very difficult to block access to these types of exchanges. Exactly how it would be very very difficult to block the entire Bitcoin network, because it is decentralized.
  • KYC / AML verification: KYC – Know Your Customer, AML – Anti Money Laundering (anti money laundering). There are exchanges, which even though they are P2P, require these verifications (they ask for copies of your ID, proof of your address, some even that you send photos with your mobile with the ID next to it). These data, GUARANTEED, are communicated at some point to your government, finance or authorities. Now, not all this data reaches the authorities directly, but at some point for sure. For this reason, this aspect must be taken into account. If you do not have any problem with your BTC purchases, for personal use and you also declare everything to the farm, because you have absolutely no problem using these types of exchanges. The only problem that we see in this is that it is possible that these exchanges can also sell this data to third parties, even though they keep saying no. Caution is recommended when choosing these. Better to go for the ones that most people use and that are more reliable, more serious.

—> Here is a list of various P2P exchanges of various types, but as a proven recommendation, I have personally used Bisq and HodlHodl. You are free to try any of this list.

—> Here is another list of various P2P Exchanges, well explained and simple graph (hover the mouse over the icons and it explains the functionality).

Example how to use P2P exchanges: HODLHODL (onchain y LN)  –  Bisq P2P exchange  –  LocalCoin Swap P2P exchange   –  LocalCryptos P2P exchange

BlueWallet – HODL in-wallet exchange  –  Bitstamp (KYC)

B. Exchanges Trading (Market Maker): A market maker (MM) is a company or individual who actively trades two-sided markets in a security, providing bids and offers (known as requests) along with the market size of each. The most common type of market maker is a brokerage firm that offers buy and sell solutions for investors in an effort to keep financial markets liquid. Most of these exchanges are centralized and with KYC / AML. These are recommended in the case if you want to enter the world of speculation, massive buying / selling of BTC and other cryptos. They can also be used for small, normal purchases, in case you want to take advantage of the lowest price on the market. There are people who buy BTC from here and sell them in P2P exchanges for a higher price, making a good profit from this movement. But you have to take into account all the factors and risks that this implies. This is NOT for newbies (padawans)!
We are going to mention here a few with which they have been tested and there is no risk of fraud: BitstampBinanceBitMexKrakenBTSE and many more you can check here: https://www.buybitcoinworldwide.com/
—> Here you have a list of Trading Exchanges, of the most cited.

C. Exchanges Lightning Network (LN): They are those exchanges (web pages or mobile applications) that offer changes from LN channels / wallets to onchain wallets and vice versa. It can also be Trading Exchanges which offer support to withdraw your purchases of BTC in LN channels.
—> Here we have a list of Exchanges LN.

Here is a curated list of exchanges for UK, US, South Africa in particular (users tested and used with success).