Cryptocurrencies, especially bitcoin, have proven to be a popular trading vehicle, even if legendary investors like warren buffett think it’s as good as it is useless. Part of the popularity of cryptocurrencies is due to their volatility, as these changes allow traders to make money from price movements.
for example, in early 2017, the price of bitcoin broke the $1,000 barrier. by the end of the year, the digital currency had reached almost $20,000. Almost a year later, bitcoin hovered around $3,200. but it came back to life in 2019, rising to over $10,000 and then significantly higher, crossing the $60,000 level in early 2021. it hit an all-time high of over $68,000 in November 2021, but has been under intense pressure ever since pressure.
Reading: Best bitcoin broker
It is this type of price movement that has attracted traders looking to ride the waves for profit. while some traders like to own the currency outright, others turn to the futures market. Futures can be an even more attractive way to play on the volatility of digital currencies like bitcoin, because they allow traders to use leverage to increase their profits (but also to increase their losses). but futures carry much more risk for that potentially higher reward.
where you can buy and sell cryptocurrencies
Traditional brokers have the advantage of offering a wide selection of investable securities, although you can’t usually trade bitcoin directly, only futures. Crypto exchanges, meanwhile, are limited to digital currencies, though you can own the coins outright and can often buy multiple ones, rather than just bitcoin or bitcoin futures as you would with a general broker. and services like cash app and paypal have also gotten in on the act, allowing us users to buy and sell cryptocurrencies.
here are the best brokers for cryptocurrency trading, including traditional online brokers as well as a new specialized cryptocurrency exchange. You may also want to check out which brokers offer the best account opening bonuses to determine where you can get a little extra.
Summary: Best Brokers for Cryptocurrency Trading in August 2022
robinhood is a great option to buy crypto directly. You’ll also be able to take advantage of Robinhood’s wildly popular trading fees: $0 per trade, or no fees, though you’ll still pay a built-in markup on any trade. And if you’re interested in more than just cryptocurrencies, you can stick with stock trading and ETFs for the same low price. Robinhood’s nifty app makes trading so easy, though those looking for a full-featured trading experience will be disappointed.
account minimum: $0
interactive brokers allow you to trade four cryptocurrencies directly, including bitcoin and ethereum, for one of the lowest fees on the market. it also allows you to buy bitcoin and ethereum futures instead of owning the coins directly. And in the case of this broker, you can buy bitcoin futures on the Chicago Mercantile Exchange, with contracts costing $11.02 at five coins per contract or Ethereum contracts for $9.02 at 50 coins per contract. Plus, Interactive Brokers brings their full suite of investment offerings, so you can buy just about anything that’s traded on an exchange.
commission: 0.12-0.18 percent of trade value; $10.02 per futures contract
account minimum: $0
Although webull may be less well known than its rival no-fee trading app robinhood, it offers investors a solid offering that includes cryptocurrency trading. While you won’t pay commissions for trading cryptocurrencies (or stocks and ETFs), WeBull charges a 100 basis point markup (1 percent of the price) on both sides of a trade. Several cryptocurrencies are available for trading, including Bitcoin, Ethereum, and Cardano. charting tools and an impressive mobile app make webull a broker worth considering.
minimum account: $1 to trade cryptocurrencies
Traders have a couple of options at this broker, which has implemented direct forex trading via trading station crypto, with commission-based pricing for traders. the price is based on your account balance with the broker and whether your order is directly marketable. typically the price ranges from 0.05 percent of your order to 0.3 percent. Traders can also buy and sell bitcoin futures, as well as take advantage of significant volume trading discounts.
commission: 0.05-0.30 percent
account minimum: $0, but futures margin depends on the contract
binance is a specialized trading platform that allows you to buy and sell digital currencies, including the largest ones like bitcoin and ethereum, but also dozens of other much smaller currencies. In total, you will have access to about 60 cryptocurrencies. The commission structure on Binance is low and it only gets cheaper the more you trade. trading fees start at 0.1 percent of your trade value (that is, $10 for every $10,000 traded) and decrease from there, based on your trading volume over the previous 30 days.
commission: 0.1 percent of the value of the transaction or less
account minimum: $0
coinbase is a specialized cryptocurrency-focused platform that allows you to trade digital currencies directly, including bitcoin, ethereum, solana, and tether. In total, you will have access to more than 100 cryptocurrencies. You will also be able to store your coins in a vault with deferred withdrawals for additional protection. the commission structure of the exchange is steep. it charges a markup of around 0.5 percent and adds a transaction fee depending on the size of the transaction and the funding source, although its professional platform is cheaper.
commission: at least 1.99 percent of the value of the transaction
account minimum: $0
etoro offers commission-free cryptocurrency trading, but like many other brokers, it charges a spread based on the cryptocurrency being traded. You will pay a 75 basis point surcharge per bitcoin, but more obscure cryptocurrencies can approach 500 basis points, or 5 percent. An important feature of etoro is the copytrader, which allows you to follow and identify other major traders on the platform and copy their trades. be sure to do your research before committing to this strategy.
commission: $0 plus a differential markup based on the cryptocurrency being traded
account minimum: $50
kraken is a cryptocurrency exchange that allows you to trade dozens of different digital currencies like bitcoin and ethereum, as well as emerging ones like cardano and solana. you’ll pay a 1.5 percent fee, or 0.9 percent for stablecoins, plus additional fees if you use a card and fund through a bank. The most active traders can benefit from a premium level called Kraken Pro, where the fee range is reduced from 0.16 to 0.26 percent. Kraken is not yet available to residents of New York and Washington State.
commission: 1.5 percent, or 0.9 percent for stablecoins (less with kraken pro)
account minimum: $1
charles schwab is routinely one of the bankrate options for the best broker, and this investor-friendly company offers bitcoin futures trading. Schwab also does not have an account minimum, but any futures contracts you trade will require a minimum margin to keep them open. schwab offers an attractive commission of $1.50 per contract and if you can contribute a lot of money, you will also receive a welcome bonus.
commission: $1.50 per contract
account minimum: $0, futures margin depends on the contract
td ameritrade is one of the leading full-service brokers on the market and not only offers access to traditional products like stocks and bonds, but has expanded its offering to include bitcoin futures. however, td ameritrade does not allow direct trading in the digital currency. You will need to meet the account minimum to get started with bitcoin futures. (Charles Schwab bought TD Ameritrade and will eventually integrate the two companies).
commission: $2.25 per contract
minimum account: $25,000 for futures
Whenever selecting a broker, it is important to consider all of your needs. And for new cryptocurrency traders, you’ll want to figure out if you want to own the virtual currency directly or if you want to trade futures, which offer higher reward, but also higher risk.
You will also need to consider whether you want to trade more than bitcoin, which is what most traditional brokers restrict you to. If not, you may want to turn to a cryptocurrency exchange as they offer more options of tradable cryptocurrencies.