Exchanges

Crypto Exchanges KuCoin vs. Binance

With another government shutdown in the midst, and continued mistrust within the banking industry, more people than ever are turning to cryptocurrency for their futures/retirement. Let’s discuss some of the basics of cryptocurrency and how the numbers are calculated, then we can move on to the top two cryptocurrency exchanges used today KuCoin and Binance.

First let’s go over the basics.  Try to think of how Stock market analysts use the market capitalization of a company to make informed decisions.  Market capitalization or Market Cap simply defines the current share price of that company and then multiplies it by the total number of existing shares. If you take this idea and put it into crypto currency terms, this means that the current price of a coin times the total number of that coin that is in the market (often referred to as the circulating supply.)

Bitcoin holds the largest cryptocurrency market capitalization, with a current circulating supply at a little over 17,000,000 bitcoins with a price at the time of this article of $3,997.99. Looking through the list of cryptocurrency (Alternative Coins), those ranked around the 100 mark on the list you will find generally has a market cap of approx. $55,000,000.  What does this tell us?  It typically tells us the amount of risk that is involved with the investment.  Below are some further examples of this.

Cryptocurrency Market Cap = Total Current Coins * Current Price

Bitcoin Market Cap, approximately = 17,000,000 * $3,997.99 = $67,965,830,000

Although one of these coins may sell at a lower price than Bitcoin, you’re buying into less value. However, these cryptocurrencies also have more potential for growth.  Your challenge is to determine which of these low-cap coins could possibly bring as much value to the world as Bitcoin has.

Now that we have gone through that, let’s get down to today’s topic and let’s talk cryptocurrency exchanges.

In the world of cryptocurrency, exchanges are like snowflakes and fingerprints, there are no two that are exactly alike. There are endless options and each one a vast variety of benefits. The exchanges that succeed will be the ones that offer features that every trader can use and enjoy.

The top priorities you are going to want to be looking for when reviewing/selecting exchanges will differ from person to person, but in case you need some help getting started on what to look for, here are some suggestions.  The safety measures the exchange utilizes for its customers (How safe is it), the overall amount of time that it takes for your transactions to be executed (will the exchange be overwhelmed with orders causing slower transaction times), trading fees, availability (mobile app, exchange website, etc.), Multi-Lingual Support (Assistance in various languages), Coin availability (what variety of alt coins is available and what cryptocurrencies can you trade in on the exchange).

Now that we have addressed the basic’s, let’s move on to some additional questions that tend to pop up.  You might also start asking where do I buy such cryptocurrencies? What are the best cryptocurrency exchanges?

Introduction to the KuCoin exchange

Whether you are a crypto newbie or veteran you have more than likely heard of the exchange KuCoin.  KuCoin is a Hong Kong based cryptocurrency exchange that has been distinguished by its rewards currency, KuCoin Shares (KCS), and its exceptionally wide range of cryptocurrencies.  It has a reputation as an early adopter, so buyers hoping to hold coins while they are still cheap might want to consider KuCoin.

It is one of the strongest exchange’s around that also offers a mobile app (Android and iOS).  They constantly update their mobile app to make it one of the best in the in the industry. KuCoin offers many popular and unique coins such as DragonChain, $KCS, and Many others.

KuCoin has No deposit fees, and a Trading Fee of 0.1% (lower than many other exchanges).  On top of this, it also offers a charting package through a third-party (Trading View System), to suit more focused traders.

The main downside is that KuCoin does not deal in any fiat currencies. You will need to have BTC or ETH to trade the full range of coins that are available.  You can also trade a more limited selection with NEO, BCH, USDT (Ther) or KCS (the exchange’s own coin).

KuCoin offers users the unique chance to hold the platform’s own native cryptocurrency, KuCoin Shares (KCS), which users can hold in order to receive discounts while trading as well as receive dividends from trading fees collected on the platform.

Holders receive a 1% discount on trading fees for every 1,000 KCS they hold, up to a maximum of 30%.

The dividends system is what sets KCS and KuCoin apart from other exchange coins.  KuCoin pays out 50% of all fee revenue from the platform each day which is equally divided between every KCS token held on the platform.

At this point you might be wondering what does this all mean.  What this means is that a user who holds upwards of 1,000 KCS receives both a discount on all trading on the platform as well as a passive income on a daily basis.  KuCoin shares may also be traded with several coins, but KuCoin shares may only be purchased on the KuCoin exchange.

How Do I Access/Open an Account with KuCoin? 

You can view the markets on KuCoin without registering for an account, but to actually make a trade, you will need to sign up and log in.

  • -Visit KuCoin and sign up for an account. Make sure to go the extra step and set up 2-factor authentication (2FA) right away. You can activate 2FA by going to Account and Google 2-Step.
  •         -KuCoin as of November 1, 2018 has adopted the Know Your Customer (KYC) verification process in          addition to the steps above.
  • -Next, you’ll want to add some funds to your account to trade for altcoins. KuCoin hosts an impressive number of trading pairs, so you can use either BTC, ETH, NEO, USDT or BCH for trading.
  • -To send coins, navigate to your wallet by clicking on Assets on the top banner. This shows all your available coin balances. Next, click Deposit. By default, it will show KuCoin Shares. Click on the name to reveal the dropdown menu and select the coin you want to deposit.
  • -Your deposit address and QR code will be revealed. Copy the deposit address into your withdrawal account exactly as it is written. Once you confirm the transfer, wait patiently for the funds to arrive in your KuCoin account. You should receive an email once they have been received.
  • -Once your funds have arrived, navigate to Markets via the top banner menu. You will then need to select the currency you deposited, which will allow you to trade all altcoins paired with that coin. Click on the altcoin pair you wish to trade. For example, clicking on ZIL/BTC will allow you to trade BTC in return for ZIL.
  • -Once you select the pair you wish to trade, you will be taken to a new screen that displays a chart with price over time, the order book (supply/demand), price data and trade history. The box in the bottom right corner will ask you to input your two-step verification code.
  • -This box is where you can buy and sell your cryptocurrency. Use the green box on the left to input the price you wish to pay per unit of the coin, then the total amount of coins you wish to purchase. To make things easier, there is a slider that you can adjust to spend a percentage of your spendable holdings. The box to the right allows you to follow the same process to sell a coin.
  • -Once your trade has been lodged, you will need to wait until there is a corresponding buy/sell order. Once the trade has been matched, the coin will show up in your wallet immediately, which can be accessed via the Assets tab.
  • -After you are done trading, you may keep your coins on KuCoin or move them to another wallet. As always, I recommend keeping your coins in a hard wallet to increase your safety and keep full control over your cryptocurrency.

KNOW YOUR CUSTOMER- SECURITY/REQUIREMENTS

KuCoin is responsible for monitoring trading activity in accordance with AML&CFT rules. You are welcome to upgrade your account to Verified and Qualified status in order to obtain promoted withdrawal volume and upgraded authorization. You may rest assured that your personal information is totally confidential and under stringent security watch. Learn more

Notice: The KYC is not compulsory, which means if client chooses not to complete his/her KYC, the client could always trade without any restrictions. However there will be a limit of 2 BTC on withdrawal amount in 24 hours.The limitation on the withdrawal for KYC unverified account has been implemented on the 1st of Nov 2018.

It normally takes 5 days for KuCoin to verify client’s KYC info.

We strongly suggest  users to complete their KYC verifications. To avoid circumstances like forgetting the credentials to access the platform and accounts being taken over by others (information leakage from client side), the verified KYC information will help the client recover his/her account quickly.  A KYC verified account will have access to the Fiat-Crypto exchange services provided on KuCoin platform in the future.

Now you should be able to navigate through KuCoin like a seasoned professional.  Let’s move on to our next cryptocurrency exchange Binance.

 

Introduction to the Binance Exchange

Binance was founded by business partners Changpeng Zhao and Yi He.  Both worked together at the OKCoin cryptocurrency exchange before they decided to branch out and build their own cryptocurrency exchange which was started back in 2017 in China.  In September of 2017, the company was forced to leave China after the Chineese government banned cryptocurrency trading.   Since this time the company has moved its offices from China, Japan, Taiwan and is currently based in the cryptocurrency friendly country of Malta.

It is a crypto-to-crypto exchange which means that a user can only use it to trade cryptocurrencies. If you don’t already own some cryptocurrency, then you’ll need to buy some before you can start trading with Binance. Once you have the necessary cryptocurrency to get started, you can then use it to trade with more than 200 different coins and tokens.

Binance  is the 2nd largest exchange on the market and is capable of sustaining 1,400,000 orders in just one second’s time.  This means, in their own words, “You can be certain, on our exchange, that your orders will never be stuck due to the matching engine being overwhelmed.”   They also havea trading volume of over 1.4 billion US Dollars leaving millions of happy customers all over the world because it is simple to use and has features that make trading very user friendly no matter what level trader you are.

Binance created its own cryptocurrency called Bianance Coin (BNB).  The exchange use an initial coin offering (ICO) of the Binance Coin to raise 15 Million USD worth of finding in July 2017.  Since creating its own cryptocurrency numerous exchanges have followed the lead by creating their own coins.  When using BNB discounts of  up to 50% are available to traders that choose to use BNB to pay trading fees.

Just a quick note: An initial coin offering (ICO) is an easy way for crypto businesses to raise money without involving more complicated methods like bonds or stocks.

Trading Fees

Binance trading fees are some of the lowest on the market. Binance doesn’t charge users for making deposits since it is a cryptocurrency only exchange. By doing this it  avoids the high fees that exchanges that offer fiat trading have to charge.

Withdrawal fees differ for different cryptocurrencies but are all quite low.  Binance trading fees are capped at 0.1% of each purchase or sale users make. This fee is reduced by 50% if traders use Binance Coin to pay them.

Binance offers its users a great selection of coins and the kind of market information you won’t find on most other exchanges. The one thing it doesn’t have is fiat trading. But that’s about to change…On June 28 2018, Team Binance announced that it had launched its first fiat trading exchange in…Uganda! Binance Uganda will allow traders to use Binance to buy cryptocurrencies with fiat currencies for the first time. When fiat trading becomes available across all of Binance’s platforms, most users won’t need to go anywhere else.

The Tokens Are Burning:

What exactly does this mean?  For those wondering what “burning” is, as it pertains to the BNB token, Blockonomi.com author Oliver Dale provides an excellent explanation.

“Binance will use 20 percent of the profits from every quarter to buy back and then burn BNB. It will continue this process until the supply of BNB is 50 percent of the original amount, with 100 million BNB remaining. Every buyback transaction conducted by Binance to burn BNB will be announced via the blockchain for transparency.”

This leaves us with the questions of how will these buybacks affect the altcoin’s price going forward?  The burns that have occurred already have had a positive impact on the price point.

As Oliver Dale puts it, “The price tends to increase dramatically right before the burn and then drop down a bit right after the burn. This post-burn drop, however, is still well above the value of the token before the pre-burn rally.”

How to Open an Account with Binance

Follow the simple instructions below and you’ll be trading in no time at all!

  1. Get registered: The first thing you need to know about how to use Binance is how to get registered! Go to the Binance homepage and click on Register.
    You’ll be redirected to the registration page where you’ll need to enter your email address and create a password.

Note: Always use an email address which you know is secure and that you check regularly. When creating a password, use a mix of numbers, symbols, upper and lower-case letters.

  1. Read and agree to Binance’s Terms of Use and click Register.
  2. Prove that you’re not a robot. You’ll be asked to complete a puzzle which you should find easy unless…you’re a robot!
    An email will now be sent to you. Click on Verify Email to complete your registration.

Congratulations! You’re a Binance account holder.

  1. Secure your account: When your login for the first time, you’ll be asked if you want to set up 2FA. You want to make sure that you set up the 2FA feature, it’s very important! If you choose Skip for now you will later regret it!

Note: 2FA is two-factor authentication. It’s a security feature which gives users an extra level of security with an additional form of password. When using 2FA, users enter their normal password and a second code which can be sent to a mobile device by SMS or created by the Google Authenticator app.

Once you have completed this added security step you will be ready to fund your account.  You will be funding your Binance account with cryptocurrency from a wallet or other cryptocurrency exchange.

How to Fund an Account

For this Binance tutorial, I will use Coinbase as an example of one way that you can fund your Binance account. A similar process will apply to almost any other exchange you are sending the funds from..

  1. Go to Coinbase: Login to your Coinbase account and click on Accounts. Next, click on Send where it lists the Wallet for the desired crypto.
    You’ll be asked to enter a Recipient. This is where the coin you choose will be sent (ex. ETH). You’re sending it to Binance so you need to get the deposit address from your Binance account for the coin you are depositing into your Binance account.
  1. Login to your Binance account. On the taskbar, click on Funds then Deposits.

Now enter the cryptocurrency you need an address for. Binance will create an address for that crypto for you to send funds to.

  1. The Coin Deposit Address is where you will be sending your funds from your wallet so copy and paste it into the Recipient box in your Coinbase account.

All you need to do now is decide how much you want to send to your Binance account and click Send. The funds will appear in your Binance account as soon as they are processed by the network.

How to Trade on Binance

There are two Binance trading settings: Basic and Advanced. Beginners should start by trading in Basic.

The Basic trade setting has a simple layout that’s easy to understand and only shows  important information for making trades. You must remember that Binance is a professional trading platform, so even the Basic trade setting might seem too complicated but it once you go through the motions once or twice you will be a seasoned pro.

The Advanced trade setting gives expert traders access to all of the price charts and market data that they need to make complex trades.

Binance for Basic Trades

  1. Login to your Binance account. 
  2. Click on Exchange on the taskbar and select Basic
  3. Choose a trading pair. Binance lists hundreds of trading pairs. These are pairs of coins that Binance offers an exchange rate for. For example, Bitcoin can be traded with 143 different coins so we say that Bitcoin has 143 trading pairs on Binance.
  4. Choose which type of trade you want to make. Binance offers three kinds of trade:
  • Limit orders allow users to set the maximum price they are willing to pay for coins or the minimum price they are willing to sell them for. Traders then have to wait until a buyer or seller accepts their price. 
  • Market orders allow users to trade coins at their current market price. This kind of trade is the fastest and most simple. 
  • Stop-limit orders allow traders to buy or sell a coin once it has reached a certain price. This kind of order is often used by pro-traders. Today, I’m only going to show you how to buy on Binance with market orders. They are quick, simple and perfect for beginners.
  1. Choose the amount you want to trade. Click on Market if you are happy with the current market price and enter the amount of the chosen coin that you want to buy. You can enter as an amount or as a percentage in your account.
  2. Click on Buy and that’s it.

 

 

 

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