Finding the best cryptocurrency exchange in the U.K. depends largely on your needs and the type of digital assets you plan to trade. Just about every U.K. exchange supports the best cryptocurrency, Bitcoin (BTC or XBT), although other lesser-known cryptocurrencies may not be supported. Several great crypto exchanges are based in the U.K., so pick the one that best suits your needs.
If you have no experience with cryptocurrencies (even if you have prior experience with forex, stocks or futures) you would be well-advised to learn how to trade cryptocurrency before you open an account with an exchange. One of the best ways to learn cryptocurrency trading involves opening a free demo account with an online broker like XTB.
Regardless of your trading results in a demo account, remember that they could differ significantly when using a live funded account at a crypto exchange or online broker. Your success as a trader typically depends on your trading skills, including how you deal with the inherent volatility of digital assets.
Overview: Cryptocurrency Exchanges in the U.K.
If you plan to exchange one altcoin for another, opening an account at a cryptocurrency exchange might make sense. These exchanges allow you to purchase and sell coins for other digital currencies or for national currencies like GBP, USD or EUR.
Most of these exchanges require identification verification in order to open an account. If you want to make an occasional altcoin transaction, you can use a bitcoin ATM that requires you to have a crypto wallet or you can create one.
In addition to exchanges, peer-to-peer trading platforms can also be used to exchange altcoins. These usually match buyers and sellers in a similar location and take a fee off the top of each transaction. Other exchanges consist of platforms that offer direct person-to-person trading between people in different countries.
Peer-to-peer trading platforms generally do not place a fixed price on transactions, but instead allow each seller or buyer to set their own rate of exchange. Another exchange option consists of cryptocurrency brokers you can physically visit to buy or sell cryptocurrencies at prices set by the broker, much like local cambios do with foreign currencies.
What Makes a Great Cryptocurrency Exchange?
Before placing your first order, do a little research on the different exchanges. The elements listed below can help you find the best ones.
Pick 1: Reputation
Reputation is one of the most important factors to consider when choosing an exchange. To research a cryptocurrency exchange’s reputation, visit trusted industry websites and read reviews. You can also go to cryptocurrency forums such as Bitcointalk and find out what other traders have experienced.
Has the exchange been hacked in the past? If so, what action or inaction has been taken on behalf of clients who may have been hacked?
Furthermore, an exchange that does not insure or segregate client funds could subject your money to theft. If you choose to leave your coins or other digital assets in an exchange, make sure that the exchange has a reliable “cold storage” facility to reduce the likelihood of hacking.
Fees and Payment Methods
To avoid unpleasant surprises after you’ve started to make transactions, be aware of all the fees the exchange charges. Fees can vary considerably depending on what exchange you use.
Does the exchange let you fund purchases with a credit or debit card? Can you PayPal them the money or would you have to pay for a bank wire transfer instead? Some exchanges do not accept national currencies and only accept other cryptocurrencies to fund an account. An exchange with limited payment options could make cryptocurrency purchases quite inconvenient.
Generally, exchanges that accept credit cards require identity verification and charge higher fees due to the higher risk of fraud or theft. They may also charge higher processing and transaction fees. In addition, purchases made through wire transfers can take considerably longer to process.
Almost all U.K. exchanges require some form of ID verification in order to make deposits and withdrawals. Nevertheless, some exchanges do allow you to remain anonymous, so check with the exchange if anonymity matters to you. Exchange ID verification can often take up to several days, but it helps weed out money launderers, fraudsters and other scammers.
Different exchanges can offer varying rates of exchange for cryptocurrencies quoted in national currencies, as well as wider or narrower bid offer spreads. Before you open an account, inquire about the prospective exchange’s dealing spreads.
Exchange rates have also been known to fluctuate widely in fast markets, with the actual volatility observed depending on the currency and cryptocurrency involved.
Below, we’ve rounded up three of the most popular exchanges based in the U.K.
Pick 1: BC Bitcoin
Considered one of the most trusted cryptocurrency exchanges in the U.K., BC Bitcoin is a professional bespoke U.K. cryptocurrency brokerage firm. The company offers a wide range of coins and tokens and buys and sells all major cryptocurrencies including Bitcoin, Bitcoin Cash, Ripple, Ethereum and Litecoin.
The company offers clients a professional and customized execution service that targets specific prices with stop-losses and limit orders. Also, since the exchange’s base is in the U.K., transfers to your British bank account are immediate.
BC Bitcoin offers another service, which consists of mining packages since BC Bitcoin operates a mining pool on the Bitcoin blockchain. The company assists its customers that pay for mining packages by supplying cryptocurrencies to upgrade memberships and account packages.
Mining pool packages range from $500 to $5,000, and memberships to the Bitclub network are priced at $99 each. BC Bitcoin facilitates these packages on behalf of the Bitclub network and has no other affiliation with it.
Pick 2: Localbitcoins.com
LocalBitcoins.com is a person-to-person cryptocurrency trading site that networks buyers and sellers from different countries to trade bitcoins or other cryptocurrencies against local currency. The website allows clients to post advertisements stating the exchange rate and payment methods.
People reply to the advertisements and agree to meet with the counter-party to transact cryptocurrencies versus cash or to trade them directly via online banking accounts. The cryptocurrency seller then places it into the Localbitcoins.com wallet where the buyer can pay directly for it with national currency.
Localbitcoins.com differs from centralized exchanges in that its exchange is decentralized and requires you to deal directly with another person. Consequently, the process saves on corporate overhead, thereby making buying and selling cryptocurrencies extremely efficient.
You receive your cryptocurrency immediately, with just about every financial payment method in the user community accepted by the exchange. Also, Localbitcoins.com offers a transaction escrow service to protect buyers and sellers.
The process of opening an account and buying cryptocurrencies usually takes only a few minutes, from the time a user account is created to the cryptocurrency is received in your wallet.
Pick 3: Quickbitcoin
This U.K.-based exchange prides itself on the speed of their transactions that enable people to quickly and easily purchase cryptocurrency within the U.K.. By using standard U.K. bank transfers, the average time for a transaction to take place is under 10 minutes.
With many crypto exchanges, just opening an account and verifying your identification can take as long as a week before you receive your cryptocurrency. While Quickbitcoin may take a short time to verify your application, the process usually only takes a few business hours and verification often occurs on the same day.
The process for making cryptocurrency purchases could not be simpler:
- First, select the amount of coins you wish to purchase.
- Then, fill out an order form and submit it.
- Next, make a bank transfer to Quickbitcoins that provides you with bank details.
- Your purchased cryptocurrency then gets delivered to your wallet’s public key.
Finding a great cryptocurrency exchange in the U.K. is far easier than you might imagine. There are a number of exchanges available locally, as well as on the international and semi-international exchanges, so it’s only a matter of determining your needs and finding an exchange that best fits those needs.
Take into account exchange reputation, transaction fees, other costs, exchange rates, dealer spreads and customer service. Don’t forget to consider the time needed to open an account, as well as how long it takes for you to receive the cryptocurrencies you purchase.