Over recent years, we have seen a Cambrian explosion of Bitcoin and cryptocurrency exchanges. It is reported that there are more than 500 crypto exchanges worldwide today, each with its own unique interface, set of markets, and order types.
In today’s Crypto Traders Guide, we find out what is a multi-exchange cryptocurrency trading platform, explore the benefits and risks of using such platforms, and examine three such crypto trading terminals.
What is a Multi-exchange Crypto Trading Platform?
A multi-exchange cryptocurrency trading platform is a trading terminal that enables users to connect and manage your portfolio across multiple exchange accounts all from one single platform. This is done by adding your API keys which are generated from your exchange accounts.
Once all your crypto exchange accounts are connected into a single platform, you no longer have to use each individual exchange’s interface. The unified account will now track and combine all portfolios, and traders will be able to track prices, view and execute orders, and other data across all exchange accounts from a single interface.
In addition, most multi-exchange platforms provide various information tools such as price charts, news aggregators, sentiment tools, arbitrage matrix and price alerts.
With regards to API keys security, these platforms do not require withdrawal or deposit permissions which limits the possibility of theft.
Finally, multi-exchange trading platforms do not typically charge additional trading fees and usually use a flat-fee monthly subscription model.
Why Use a Multi-exchange Crypto Trading Platform?
It is common for a crypto trader and investor to have an account on more than one exchange. Users have to re-learn the interface with each new exchange, make do with whatever order types are made available on the exchange, and deal with having multiple tabs open on your browser to navigate through all these exchanges and various trading tools.
Not to mention, it is quite a hassle to have to log in to these multiple accounts, entering your 2-factor authentication every time, or deal with those annoying captchas.
A multi-exchange crypto trading terminal solves many of these problems.
Benefits of Using Crypto Trading Terminals
One of the biggest benefits of using multi-exchange cryptocurrency trading terminals is that you only need one interface no matter which exchange you’re trading on, making it more user-friendly, and less of a hassle since you only need to log in once.
Such platforms generally provide a suite of advanced trading tools, such as advanced order types, price alerts, technical indicators, and analysis tools. Some platforms also provide arbitrage opportunities, either by displaying an arbitrage matrix to see at one glance which exchange provides the best price, or the ability to route orders to a crypto exchange of the user’s choice to achieve the best execution (taking into account price, depth of the ladder, available funds, etc.).
Lastly, these trading terminals provide an aggregated view on account balances and portfolio metrics across all exchange accounts, without having to input the data manually.
Risks of Using Crypto Trading Terminals
You have to trust your API keys with a third-party, although this is mitigated because deposit and withdraw permissions are usually not required. Furthermore, this can be reduced to a risk-free option by using read-only keys if you only want to use portfolio tracking features without the ability to execute trades.
There are also limitations of APIs, such as rate limits, and the potential for downtime which could significantly impact trading results.
3 Types of Multi-exchange Cryptocurrency Trading Platforms
There are several multi-exchange platforms offering a variety of services, ranging from simple crypto portfolio trackers to advanced trading suites, web apps and mobile apps, while some incorporate social trading. Let’s look at three varieties of multi-exchange crypto trading platforms available on the market today.
Coinigy lets you trade on more than 25 Bitcoin and crypto exchanges through one account, and dubs itself as the ultimate cryptocurrency portfolio management suite. The web-based multi-exchange API trading platform combines a wide array of trading features such as advanced trade orders, price alerts, market data overview, crypto news, and charting tools.
TabTrader is a free multi-exchange crypto trading terminal for Bitcoin and cryptocurrency exchanges. It is a mobile application available on both iOS and Android, enabling you to track and analyse prices on-the-go. It also provides alerts on indicators, technical analysis tools, and enables you to track your crypto portfolio. You don’t need to store your API keys with TabTrader as they are kept on your own device.
Aluna.Social combines a multi-exchange crypto trading terminal with a social network. On top of being able to manage all their exchange accounts in one place, users benefit from the wisdom of crowds as they get to see the live trades and performance history of other users, get access to useful sentiment data and have the ability to automatically copy the trades of the best traders in the World.
Multi-exchange cryptocurrency trading platforms provide a multitude of benefits over using individual exchanges separately but are not without risks. There are several choices of such platforms, each with their own distinct set of unique features, ranging from advanced trading tools to integration with social features. These API trading terminals are useful tools for traders looking to up their trading game, but it is essential that traders weigh the pros and cons of each option according to their needs in deciding on which one to use and handing over any sensitive data.