In our modern age, anyone desiring a cryptocurrency can go to an exchange and become the proud owner of a Bitcoin (Bitcoin), Ethereum (ETH/USD) or any other Altcoin. It seems that nothing could be easier, if not for a few ‘buts’.
History demonstrates that crypto-exchanges are not the most reliable place for purchasing and safekeeping your assets.
The story of Mt.Gox — which, overseeing circa 70% of all Bitcoin transactions, used to be the largest crypto-trading platform — has now become infamous. In early 2014, Mt.Gox ceased operations. Its founder justified this by alleging a cyber-attack. It was later revealed, however, that Mt. Gox had already started moving out assets in 2011, meaning that its balance sheet was virtually empty by 2013.
Another recent case is that of Coincheck — a cryptocurrency exchange which was breached by hackers this January, resulting in a loss of around 400 million dollars’ worth in digital tokens. To date, this represents one of the largest such exfiltrations in history, with hackers having been able to steal over 500 million ‘NEM’ coins.
Such attacks are far from the only issue. For instance, the BTC cryptocurrency exchange shut down last summer when Alexander Vinnik, its owner and manager, was arrested on charges of laundering 4 billion US dollars.
Bitcoin does not possess the legal status of a currency in most countries, meaning that authorities are often puzzled as to what to do in the event of a hacking or fraudulent event. Some cryptocurrency exchanges opt to compensate their clients for any stolen funds. However, they have no legal obligation to do so.
What should one do, then, if one wants to buy cryptocurrencies (without necessarily wanting to trade it after) but would rather avoid the risk of dealing with such exchanges?
The most reliable option in this case would be working with an intermediary, the trustworthiness of whose services is guaranteed.
Brokers buy cryptocurrencies on exchanges and sell them to clients themselves. All clients need to do is access the broker’s website, decide on a means of payment, transfer the payment, and await receipt of the chosen number of coins.
NordFX stands out among brokers offering such services—it has been operating since 2008 and possesses all the necessary licenses for carrying out brokerage activities.
It takes less than a minute to open an account on the NordFX website. Meanwhile, the terms for purchasing Bitcoin and Ethereum are better than those on exchanges due to the existence of many direct liquidity suppliers. Besides these coins, one can also work with four other leading cryptocurrencies—Litecoin (LTC/USD), Ripple (XRP/USD), Dash (DASH/USD) and Bitcoin Cash (Bitcoin.Cash).
In terms of margin trading, NordFX provides a unique opportunity to trade cryptocurrencies with a leverage ratio of up to 1:1000, which means that you can buy 1 bitcoin for less than $100. But one should keep in mind that the leverage is just a trading tool and each trader makes his own decision whether it is worth using or not.
If you are not an active trader and would like to simply invest your funds, say, in bitcoin, you just need to choose a leverage ratio of 1: 1, buy cryptocurrency and leave it stored on your account until better times. And later, when selling your bitcoins at a more profitable rate, you can at any time withdraw your money along with the profit.
We firmly believe that the choice between a highly vulnerable exchange that offers no guarantees and a highly experienced broker that has spent years refining capital protection practices is an obvious one.