The cryptocurrency euphoria in 2021 led to a boom year for crypto exchanges. Bitcoin, the digital coin created in 2009 that was once worth a fraction of a cent, rode Covid anxiety, investor thrill-seeking and mainstream adoption to a nearly $69,000 price last year.
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In the process, trillions of dollars in trade volume whisked through cryptocurrency exchanges. Matt Damon and Larry David did TV ads for them. And Los Angeles’ Staples Center got renamed after one.
As those exchanges battle for new crypto converts, Binance — a massive global exchange with a smaller U.S. offshoot — emerged over its many rivals as the Best In Fintech among cryptocurrency exchanges, according to customers surveyed by Investor’s Business Daily and polling partner TechnoMetrica. The cryptocurrency exchange ranking is part of IBD’s Best In Fintech series, which previously highlighted the best digital wallets. Future coverage will include the best investment and savings apps.
The survey findings are not based on sheer size or number of transactions, which can say more about marketing than service. Instead, the rankings reflect the consensus of customers who rated the crypto exchanges that they actually use. Binance topped Coinbase (COIN) and Crypto.com, the No. 2 and No. 3 exchanges in the survey.
The survey of 6,000 U.S. consumers scored the three exchanges across five criteria, which together produced an Overall Customer Experience Index rating. Five other exchanges didn’t qualify for the survey analysis because fewer than 100 of their customers took part in the survey. And the lion’s share of respondents, 4,324, didn’t use any cryptocurrency exchange at all.
The crypto exchanges have tried to compete for users in different ways. Some, like Binance, cater to sophisticated traders and offer some of the lowest trading fees in the game. Others, like Coinbase, charge a little bit more. But Coinbase and other higher-cost exchanges try to offer a more beginner-friendly experience.
“The beginning of the evolution was a lot of race-to-the-bottom,” Chris Kline, founder of the crypto retirement platform Bitcoin IRA, said of competition among crypto exchanges. “It was a very heavy fee conversation. Where you see it shifting toward is people are looking to pay for the experience that they want for themselves.”
Overall Customer Experience Ratings |
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| Rank | Company | Rating |
| 1 | Binance | 70.7 |
| 2 | Coinbase | 55.1 |
| 3 | Crypto.com | 53.7 |
| The Best In Fintech logo and accolade are available for licensing through IBD’s partner, The YGS Group, at [email protected] or 800-290-5460. | ||
What Is A Cryptocurrency Exchange And How Does It Work?
A cryptocurrency exchange is an online platform where people can buy and sell cryptocurrencies like Bitcoin, Ethereum or the meme-based digital asset Dogecoin.
Each platform is a bit different, though most are available via mobile apps as well as their own websites. The most popular ones offer a clean, simple menu allowing users to select what cryptocurrency they want to buy or sell and the amount they want to spend. Some charge lower fees the more a person trades, or they may tack on other fees depending on how you pay.
To sign up, users generally must provide basic information and upload a photo ID. The verification process can take several days.
As crypto made an unrelenting push into pop culture last year, volume on the exchanges swelled. On Coinbase, the largest exchange in the U.S., trading volume surged 766% last year to $1.67 trillion, according to a shareholder letter last month. Some $38 trillion in spot crypto volume passed through crypto exchanges in 2021, based on those exchanges tracked by CryptoCompare.
Where that volume might be headed is difficult to predict. The digital assets’ volatility — and the prospect of huge returns or losses — is part of the appeal as well as the danger. Investors, in some sense, are still hashing out whether Bitcoin is a currency, a safe haven against inflation or a risk asset.
“It’s still a new asset class, and it has features that fall into the safe-haven side and the risk-asset side,” said Matt Weller, global head of research at Forex.com. “I think in real time, traders are grappling with that.”
IBD Survey Of Cryptocurrency Exchange Users
The IBD/TechnoMetrica survey, conducted in late December, asked users to rate cryptocurrency exchanges based on five criteria. Those criteria were ease of use, low fees, security and privacy, customer service, and ease of converting funds from crypto to cash and vice versa.
TechnoMetrica used a Customer Experience Index, or CEI, to gauge those criteria. Each rating was calculated by adding the percent of customers who rated their experience Excellent or Very Good and subtracting the percent who gave ratings of Fair or Poor. The closer the score was to 100, the higher the user satisfaction.
The survey also asked participants for their perspectives on “digital wallet” platforms and investment apps. (See all the Best In Fintech coverage.)
Seventy-two percent of the survey participants said they hadn’t used any cryptocurrency exchange over the past year. Of those that had, Coinbase, Crypto.com and Binance were the most used.
Best Crypto Exchange: Binance
Overall, Binance ended up with the survey’s highest overall score, earning it the Best In Fintech distinction among crypto exchanges. Binance received an overall rating of 70.7. It also came in first for all five categories.
Best Crypto Exchange: Binance |
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|---|---|---|
| How customers surveyed by IBD and TechnoMetrica rated Binance among three crypto exchanges. | ||
| Rank | Service Component | Rating |
| 1 | Customer service | 73.9 |
| 1 | Ease of converting funds | 65.0 |
| 1 | Ease of use | 80.0 |
| 1 | Low fees | 56.1 |
| 1 | Security/privacy | 78.7 |
| 1 | Overall Customer Experience | 70.7 |
The survey, while focused on a U.S. audience, did not make a distinction between Binance or the version of the platform geared to the U.S., called Binance.US.
But Binance’s interface, either in the U.S. or around the world, can feel like a control tower. The interface offers a panorama of price metrics, candlestick chart indicators and elementary and sophisticated trading tools.
| Rank | Company | Rating |
| 1 | Binance | 73.9 |
| 2 | Crypto.com | 52.5 |
| 3 | Coinbase | 51.8 |
Launched in 2017, Binance made its debut in China. It doesn’t have a single specific headquarters. In 2019, after two years of rapid expansion and stretching boundaries on the ways users could access and trade on cryptocurrency exchanges, the company halted services for U.S. users.
Later that year, Binance launched Binance.US, amid efforts to stay within U.S. regulatory limits. To do so, it partnered with BAM Trading Services, based in San Francisco. Still, even within the U.S., Binance.US is unavailable in several states. And some U.S. users have tried to find ways onto the larger global Binance exchange.
Binance.US charges a 0.1% fee on spot trades on its standard interface. But for users looking to buy or sell in one click — on its easier-to-use interface — there’s a 0.5% transaction fee. Users get discounts if they pay for trading fees with BNB, a cryptocurrency created by the global version of Binance. Binance.US fees decrease with higher trading volumes. Its larger counterpart offers similar low fees and discounts.
Binance Coins, Platform Features
Newcomers to cryptocurrency exchanges likely will gravitate toward Binance.US’ “Buy Crypto” section. That section, viewed on a desktop or laptop, contains a simple interface that is heavy on white space. Its menu offers “Buy,” “Sell” and “Convert” options. Users enter how much they want to trade into a prompt that displays the amount in large font. That page also shows the price chart and a brief description of the selected cryptocurrency.
| Rank | Company | Rating |
| 1 | Binance | 65.0 |
| 2 | Coinbase | 58.7 |
| 3 | Crypto.com | 49.4 |
For more advanced traders, Binance.US also offers tools that provide visibility into technical indicators and a view of its order book. It also allows limit orders and stop-limits.
As of March 2, Binance.US allowed trading of 74 cryptocurrencies. A Binance.US spokesperson said more listings are expected this year and the platform has “millions of U.S. users,” without providing a specific figure. Binance.US saw $278 billion in trading volume last year, according to CryptoCompare.
By comparison, the global Binance service offers hundreds of cryptocurrencies, with roughly $9.9 trillion in trading volume last year. Binance’s chief executive said in 2020 that it had users in more than 180 nations.
“There are a lot of people who like Binance because it has more coins,” Kline said. “It usually comes first with new things like pairings, stablecoin differentials, those types of things.”
The menu of trading options on Binance’s main international site is far longer and, at times, more avant-garde. Those options include futures, options, leveraged tokens and competitions to predict price direction. Users can also use that platform’s ecosystem to buy or sell the crypto artwork known as NFTs, or non-fungible tokens, which have unique, stand-alone digital properties. The company did not respond to a request for an interview.
Binance Vs. Coinbase
Coinbase got an overall score of 55.1, putting it in second place but far behind Binance. Among the three cryptocurrency exchanges scored by the survey, it received the lowest rankings in customer service and low fees. Coinbase scored second in the other categories.
While Binance swept all five categories in the IBD/TechnoMetrica survey of customers, other product reviews have given Coinbase high marks for convenience and its appeal to novices and people trading from their phones.
| Rank | Company | Rating |
| 1 | Binance | 80.0 |
| 2 | Coinbase | 64.7 |
| 3 | Crypto.com | 61.0 |
Still, Coinbase users might pay a bit more than Binance for the user-friendly trading experience. Coinbase fees can be influenced by things like order size, payment method and market conditions. Those fees are calculated at the time users place their orders.
The company, when reached, would not provide specific fee amounts. But according to other reports, Coinbase charges anywhere from 0.5% to 4.5% on transactions. The trading fees cost less on Coinbase Pro, its platform for more seasoned traders.
Coinbase went public in April 2021 on the Nasdaq. The exchange closed out that year with 89 million verified users. Coinbase allowed trading of 139 different assets at the end of last year.
Coinbase has said it wants to be the “Amazon” of digital assets. CEO Brian Armstrong said in August that he wanted Coinbase to list every legal crypto-asset possible.
“There’s thousands of them today,” he said. “There’s eventually going to be millions of them.”
A Coinbase spokesperson said it would “provide tools over time to give customers ratings/reviews of assets, so they can make even more informed decisions.”
Coinbase’s ambitions have also moved beyond trading into the broader universe of Web3. Web3 envisions a more decentralized version of the internet, where apps and other services run on the blockchain.
“We now have one in four households that own some form of crypto asset,” Alesia Haas, Coinbase’s chief financial officer, said at a conference this month. “We have growth in utility of crypto, which is (why) we’ve seen new growth in NFTs, in DeFi, which all gives us a lot of hope that we’ve moved beyond speculative investing into the next generation of crypto, which is the utilization of these exciting assets and the use cases.”
Crypto.com And Other Crypto Exchanges
| Rank | Company | Rating |
| 1 | Binance | 56.1 |
| 2 | Crypto.com | 41.7 |
| 3 | Coinbase | 30.2 |
Crypto.com received an overall score of 53.7 in the IBD/TechnoMetrica survey. Volume data from CryptoCompare was unavailable.
Crypto.com allows users to buy and sell more than 250 digital assets. Trading fees on Crypto.com start at 0.4% and go lower the more volume a user trades.
The other exchanges that didn’t qualify for the analysis based on the number of customers who completed the survey were Avatrade, BitMEX, BlockFi, Cex.io and Circle.
Cryptocurrency Regulations, Security
Investors should keep in mind that crypto’s popularity has come with regulatory and security issues. Customer ratings are not the only thing that investors should consider when choosing a crypto exchange.
| Rank | Company | Rating |
| 1 | Binance | 78.7 |
| 2 | Coinbase | 70.0 |
| 3 | Crypto.com | 64 |
Coinbase, Crypto.com and Binance’s international exchange have been hacked in the past. All three cryptocurrency exchanges, to some degree, have been targeted by regulators. Nations like Italy, the U.K., Japan and Germany have also narrowed their focus on Binance over the past year.
And according to reports from Bloomberg last year, Binance’s international site faced investigations from the Justice Department and IRS. Bloomberg said “officials who probe money laundering and tax offenses” were seeking information about the exchange.
The outlet also reported that the Commodity Futures Trading Commission was looking into possible insider trading and whether Binance allowed trades of crypto derivatives. Those trades are prohibited in the U.S. unless the businesses offering them register with CFTC, Bloomberg said.
Bloomberg noted that Binance hasn’t been accused of wrongdoing. The exact scope of the U.S. investigations, and whether they’re still active, is unclear. The Binance.US spokesperson said the company did not comment on potential regulatory inquiries.
The CFTC and IRS did not respond to emailed questions. The Justice Department declined to comment.
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