A cryptocurrency exchange is a business or service that enables users to buy and sell cryptocurrencies. Cryptocurrencies, or digital assets, can be bought or sold with conventional fiat or traded with other cryptocurrencies.
Cryptocurrency exchanges can function as:
- A market maker that take the bid and ask spreads as transaction commissions
- A matching platform that charges transaction fees
They provide a much-needed service that allows greater liquidity in the cryptocurrency industry while opening up opportunities for investors and traders to turn a profit through purchasing a digital asset or trading on the asset’s price movements.