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Cryptocurrencies have become far more accessible for the average American after their recent rise in popularity. Several brokerage firms now allow investors to buy and sell cryptocurrencies right alongside their stocks, mutual funds, and other investments. Some of the top cryptocurrency exchanges have made the process more user-friendly than ever, especially those with the best cryptocurrency trading apps.
Investing in cryptocurrencies may not be right for everyone, as they're still a somewhat speculative investment. Whether or not they make money in the long term, investors can expect a roller coaster ride. That said, if you believe in the long-term potential of cryptocurrencies and have a fairly high risk tolerance, there's nothing wrong with holding some digital currency as a long-term investment.
With that in mind, here are some of the best crypto exchanges for December 2022. These include brokers, exchanges, and apps you can use to start building your own cryptocurrency portfolio today.
Our Rating:
Bottom Line
Offers a nice range of cryptocurrencies and a simple-to-use app experience. The Gemini Earn feature is also a standout perk and pays interest on idle cryptocurrencies at high rates.
Fees:
$0.99-$2.99 orders < $200, 1.49% for orders at least $200 (default), 0% – 0.40% (Gemini ActiveTrader)
Account Minimum:
$0
Our Rating:
Bottom Line
Among the best apps to buy cryptocurrencies and traditional investments like stocks and options under one roof. It has wide array of popular cryptocurrencies and gives immediate access to deposits. Plus, cryptocurrency trading on Robinhood is 100% commission free.
Fees:
$0 for stocks, ETFs, options, and cryptocurrencies
Account Minimum:
$0
Special Offer
Earn a $25 to $600 reward
Limitations Apply
Our Rating:
Bottom Line
SoFi Active Investing has a well-rounded financial ecosystem. SoFi Members can buy and sell five different cryptocurrencies. They can take out loans, save, and trade stocks. SoFi does charge a markup, but the all-in-one convenience of the platform could still make it worth a look.
Fees:
$0 for stocks, 1.25% for cryptocurrencies
Account Minimum:
$1
Special Offer
Get up to $100 in crypto with a qualifying first trade
Our Rating:
Bottom Line
eToro has a good selection cryptocurrencies on its platform. It also offers some unique offerings, such as social network-like commentating capabilities and the ability to follow and match the investments of other cryptocurrency traders.
Fees:
1% for trading crypto plus spread, $0 commission for stocks & ETFs
Account Minimum:
$10
Special Offer
Limited time offer: Deposit $100 and get a $10 bonus. Terms apply.
eToro USA LLC; Investments are subject to market risk, including the possible loss of principal.
Our Rating:
Bottom Line
Coinbase shines with its vast array of cryptocurrencies available. There's also an advanced trading platform for serious cryptocurrency enthusiasts. Plus, you can earn some free cryptocurrencies if you're willing to take some educational courses.
Fees:
Variable fees (Coinbase), 0%-0.60% (Coinbase Advanced Trade)
Account Minimum:
$2
Our Rating:
Bottom Line
Square's Cash App only offers bitcoin. But it could be a smart choice for people who only want to buy, sell, and hold the leading cryptocurrency. Plus, the popular finance app has some other great features, such as stock trading and person-to-person payments.
Fees:
$0 for stocks, fees vary for cryptocurrencies
Account Minimum:
$0
TIP
Investing in crypto can be extremely risky. We think investors should approach these assets like any other technological investment — with a long-term mindset and the expectation of ups and downs. The Fool realizes there may be opportunities for investors. We do actively recommend select cryptocurrencies to our community. But we encourage everyone to be well versed prior to investing to understand the potential risks and rewards.
If you're wondering where to buy cryptocurrency, you have several options. The best places to buy cryptocurrency can generally be separated into two main baskets:
Whether you go with a broker or an exchange, make sure it has the functionality you need. For example, if you want to buy cryptocurrency on your mobile, look for the best cryptocurrency app.
It's also possible to buy cryptocurrencies directly from other people. This used to be far more popular in the early days of Bitcoin. However, that can get a little complicated and is beyond the scope of this discussion.
A cryptocurrency exchange is a company that facilitates cryptocurrency transactions. Cryptocurrency exchange customers can buy and sell various digital currencies. They may also be able to do the following through the exchange's platform (not an exhaustive list):
Many of the best crypto exchanges have mobile apps which offer convenience if you plan to trade digital assets on the go
TIP
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There are several great cryptocurrency apps on the market. To choose the best exchange, you'll need to decide on which features matter most to you.
Here are a few to consider:
Compare top exchanges, view our expert reviews, and find the right platform for your needs.
By definition, a broker is an intermediary between two parties. It typically involves a financial transaction. For example, a real estate broker facilitates transactions between buyers and sellers of real estate.
So, technically speaking, cryptocurrency exchanges can be considered brokers. However, as we discussed above, there are two different types of intermediaries that facilitate the buying and selling of cryptocurrencies. Cryptocurrency exchanges, which allow users to buy and sell cryptocurrencies only. And brokerages that offer cryptocurrency trading alongside other investments like stocks and bonds.
They are all technically brokers. But there are two distinct types of businesses you can use to buy and sell cryptocurrencies.
Binance.US won The Ascent's 2022 award for best cryptocurrency exchange for Bitcoin. It has excellent security credentials, and offers a wide range of features for beginner and advanced traders.
Outside of focusing on just Bitcoin, Gemini stands out as one of the best cryptocurrency trading apps because you can do more than just buy Bitcoin. Gemini Earn pays interest on cryptocurrencies, and Gemini Pay lets you spend your Bitcoin at over 30,000 stores.
The best Bitcoin trading app depends on your personal needs, and there are many good apps on the market. Before you download an app, think about everything you want it to do. For example, if you want to buy and hold Bitcoin, your needs are different from those of a person who plans to build up a diverse portfolio of coins.
Learn more: Best Places to Buy Bitcoin in 2022
Cryptocurrency wallets are a safe way to store your digital assets, but you really only need one if you plan to amass large amounts of crypto assets or want to spend your crypto easily. The cryptocurrency you own is protected by public and private keys — a bit like your PIN and bank account number. You use a wallet to store your encrypted keys and keep them safe.
There are two types of wallet:
Until recently, when cryptocurrency became more mainstream, wallets were a lot more necessary. In the early days, several cryptocurrency exchanges fell victim to hacks. And at that point, if your crypto was stolen, there was no way to get it back. So long-term crypto enthusiasts use exchanges only for trading, and store their coins in their own wallets.
However, these days, it is a lot safer to leave your coins with the exchange or brokerage where you bought them. The best app for cryptocurrency will have excellent security and store your assets offline in cold storage. Several companies also insure the crypto assets they hold.
Moreover, some platforms don't give you the option to move your digital currencies. For example, the crypto platforms offered by Robinhood or SoFi Active Investing are designed for investment purposes. So if you bought Bitcoin with them, you wouldn't be able to move it out of your account.
In contrast, some of the best exchanges, like Coinbase and Gemini, have built-in wallets. Like any good exchange, each lets you transfer your currency to an external wallet as well, though you may have to pay a withdrawal fee. You may have to find a wallet that is compatible with your exchange.
Think about what you plan to do with your cryptocurrencies before you buy them. If you are investing long term and want to buy and hold, you may be happy to entrust your crypto keys to the exchange or brokerage. But if you plan to trade regularly or want to spend your coins, a wallet may make sense. In which case, you'll need to look for the best app for trading cryptocurrency that will connect easily to your wallet.
Learn more: How to safely store cryptocurrency
If you're looking for the best cryptocurrency app, fees play an important role.
Here are some fees to watch out for:
Fees can really eat into your profits, especially if you trade regularly. The best cryptocurrency trading app will let you trade, deposit, and withdraw your money at a minimal cost.
There are two components to cryptocurrency safety — security and investment volatility.
Let's first look at the security of your cryptocurrency investments.
The cryptocurrency you hold in your account in a broker or exchange is typically very secure. That's as long as you use a reputable exchange or broker (like all of those mentioned here). Indeed, one of the selling points of Bitcoin's blockchain is its security.
Most of the top cryptocurrency exchanges keep the bulk of their digital assets in "cold storage." This means they are stored offline and aren't at risk of being hacked or stolen. In the earlier days of cryptocurrencies, there was a risk of exchanges being hacked, but these issues have largely been dealt with.
Alternatively, as discussed above, you can opt to keep your cryptocurrencies in a separate digital wallet of your own. You could even use one to create your own offline storage. However, the security and functionality of the major exchanges should be enough for most investors. Bear in mind that you'll need to take steps to secure your account too — even the best app for cryptocurrency won't be protected if you don't enable two-factor authentication and set up strong passwords.
Now let's consider safety from an investment perspective.
It's important to point out that cryptocurrencies — even Bitcoin, the largest and most-established one — are a young asset class and are rather volatile. This is especially true for the smaller cryptocurrencies in the market. So, you need to be ready to withstand major price swings over time. And, just as with other investments, don't invest money you can't afford to lose.
Gemini Exchange
Investing simplicity and high interest rates
$0.99-$2.99 orders < $200, 1.49% for orders at least $200 (default), 0% – 0.40% (Gemini ActiveTrader)
Robinhood
Diversified investing needs
$0 for stocks, ETFs, options, and cryptocurrencies
Limitations Apply
SoFi Active Investing
Membership ecosystem
$0 for stocks, 1.25% for cryptocurrencies
eToro
Finding new cryptocurrency investing strategies
1% for trading crypto plus spread, $0 commission for stocks & ETFs
eToro USA LLC; Investments are subject to market risk, including the possible loss of principal.
Coinbase
Trading platform and crypto selection
Variable fees (Coinbase), 0%-0.60% (Coinbase Advanced Trade)
Cash App Investing
Investing and peer-to-peer payment
$0 for stocks, fees vary for cryptocurrencies
Reputable cryptocurrency apps take security seriously and are safe to use. Two of the best options in terms of safety are Gemini and Coinbase, which are known for employing industry-leading security measures.
If you're trying to figure out whether a specific cryptocurrency app is safe, research the security features it offers and check if it has been hacked before. The most secure crypto apps use two-factor authentication (2FA), keep the majority of customer funds offline in cold storage, and have bug bounty programs.
Crypto.com has among the most cryptocurrencies available for U.S. traders to buy and sell. It offers over 150 cryptocurrencies. For traders outside the United States, KuCoin has among the most cryptocurrencies available for purchase with over 750.
Some decentralized exchanges, including Uniswap, SushiSwap, and PancakeSwap, have much larger selections with thousands of different cryptocurrencies. However, they don't allow you to buy crypto using fiat money. You can only trade cryptocurrencies on these exchanges, which means you need to already have your own cryptocurrency ready to trade.
The best cryptocurrency app for beginners is Coinbase. It has a user-friendly design that makes it easy to buy and sell crypto, a wide selection of coins, and modules with educational content. Coinbase even rewards you with free crypto when you complete its educational modules.
A cryptocurrency exchange facilitates the purchase and sale of cryptocurrencies only. A broker is a type of investment platform. It might allow users to buy and sell cryptocurrencies as well as stocks, mutual funds, and other types of investments.
The cost to buy and sell cryptocurrencies depends on the platform. Some charge a percentage of each transaction as a "markup." Others simply make their money on the spreads between a bid and ask price. Either way, the cost of trading is one of the main points to compare between the different brokers and exchanges.
It depends. There are more than 4,000 (not a typo) different cryptocurrencies in existence, and some are far more legit than others. Most investors should stick to bitcoin and other large, established digital currencies. Avoid the newer and smaller varieties.
Hailey Lennon
Partner at Anderson Kill
What should you know before buying cryptocurrency?
You do not need to buy a whole Bitcoin or any cryptocurrency; you may make fractional purchases. For example, you can buy $10 worth of Bitcoin regardless of the price.
Most exchanges also allow you to do auto-buys so that you can have an automated purchase each week or month. This allows you to dollar-cost average given how volatile cryptocurrencies can be and not buy a large sum all at one.
There are also ways to earn free Bitcoin. For example, rewards platform Lolli offers Bitcoin back on online purchases.
How do you buy cryptocurrency?
Through a regulated exchange. I recommend exchanges that have state money transmitter licenses and the NY Bitlicense or other state or Federal licenses/charters, including, but not limited to, Gemini, Kraken, or Square.
How is cryptocurrency taxed?
Cryptocurrency is taxed as property, and as such, any profits will be taxed as capital gains. Capital gains occur when a person sells their cryptocurrency for dollars or another cryptocurrency and makes a profit.
Matt is a Certified Financial Planner® and investment advisor based in Columbia, South Carolina. He writes personal finance and investment advice for The Ascent and its parent company The Motley Fool, with more than 4,500 published articles and a 2017 SABEW Best in Business award. Matt writes a weekly investment column (“Ask a Fool”) that is syndicated in USA Today, and his work has been regularly featured on CNBC, Fox Business, MSN Money, and many other major outlets. He’s a graduate of the University of South Carolina and Nova Southeastern University, and holds a graduate certificate in financial planning from Florida State University.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
Robinhood disclosure
This advertisement contains information and materials provided by Robinhood Financial LLC and its affiliates (“Robinhood”) and Publisher, a third party not affiliated with Robinhood. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Securities offered through Robinhood Financial LLC and Robinhood Securities LLC, which are members of FINRA and SIPC. Publisher is not a member of FINRA or SIPC.
Robinhood Crypto disclosure
This advertisement contains information and materials provided by Robinhood Financial LLC, Robinhood Securities LLC and its affiliates (“Robinhood”) and Publisher, a third party not affiliated with Robinhood. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Securities offered through Robinhood Financial LLC, a member of FINRA and SIPC and a wholly-owned subsidiary of Robinhood Markets, Inc. Cryptocurrency trading offered through Robinhood Crypto LLC. Robinhood Crypto and Publisher are not a members of FINRA or SIPC and cryptocurrencies are not stocks and your cryptocurrency investments are not protected by either FDIC or SIPC insurance.
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