What makes a good Bitcoin Exchange?
I can think of 4 things that make a bitcoin exchange a good one:
- Customer Service
I’ve only seen one company doing a free exchange service that I’m interested in and that is britcoin.co.uk otherwise known as Intersango (who also have Euro and USD exchanges). After using it, nothing irks me more than to see an exchange operating wanting to take a cut out of my transactions. When you get used to trading for free, you don’t want it any other way after that. Why have someone helping themselves to your profits when you don’t have to?
This is important as larger volumes mean you can make more money on speculative trading. Though it’s not required (I’ve still speculated on Intersango USD and made a nice profit from it). I’d recommend a two pronged attack here. Go for the biggest exchange in your native currency, but don’t make them abuse you like eBay (you want 10% of my sales?). Invest some of your money in other exchanges you like the look of too. If we all did that we’d all have more choice.
Any exchange that tells me I have to ‘establish trust’ with some random stranger and directly do deals has got to be kidding me. You could run an account honestly for some time before making a steal with rather a large amount of someone else’s money. So it’s going to happen, these systems are naive.
Thankfully there are exchanges that you can deal with in escrow, as in they manage the transactions so you only have to deal with and trust them. Britcoin, Intersango & MtGox are all good ones here.
Ok, so being in the UK most of my trading is through britcoin.co.uk. I did however make a big mistake while being pissed off that my Barclay’s bank account kept throwing me out every 2 minutes claiming I’d been inactive for 10! So anyway, I sent the money with the wrong reference and realised my mistake a week later when the funds hadn’t turned up. I thought I’d lost the money but an email late Friday and it was sorted out by Sunday. Now that’s impressive customer service.
I tend to have shrunk my exchange usage to MtGox and Intersango exchanges. It really comes back to fees at the end of it all. When I’m on Intersango exchanges I make more money, when I’m on the MtGox exchange I know I can make big buys and sells and I know that there is a faster moving market. Always someone ready to buy and sell.
The best outcome for the end user is for the Intersango approach to be adopted by more exchanges and people to put their money where there mouth is. Ultimately if people are happy to pay transaction fees then they’ll have to, because the providers will learn it from their success and from their failure.
Research and vote for what you like with your feet.