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bitFlyer

bitFlyer Review
Trader's rating 1
Editor's rating 4

Account type

 

Account type Minimum deposit Leverage Fee
Standard Undisclosed 1: 15 Max 0.15% for BTC

 

BitFlyer is one of the most popular cyptocurrency exchanges in the Far East. It is also among the world leaders, in terms of volume.

 

The company, security of funds

 

Company Country Regulation
bitFlyer, Inc. Japan JFSA, NY BitLicense

 

BitFlyer is based in Japan. The local regulators have made some changes in the way they treat cryptocurrencies in the past. Currently, they are treated as assets, upon which capital gains (profiting from the price movement) is taxed. BitFlyer was one of the first companies to received the JFSA (Japanese Financial Services Agency) license, along with the major competitors from QUOINEX

 

Update: BitFlyer also received has the regulatory approval of the New York Department of Financial Services (NYDFS) in November 2017. The company is set to start offering Bitcoin trading vs the USD, while adding altcoins in the future. We will update this review, when the service is fully implemented.

 

The company has been around since 2014 and has not had any hacking issues yet. The most important thing to note, from a western trader’s point of view is that trading is done (mostly) against the Japanese YEN (JPY), unlike most exchanges where you can trade cryptocurrencies against one another, the US Dollar and occasionally the Euro. You may need an account with a forex broker, such as FXTM, just to hedge your currency risk.

 

The user reviews on BitFlyer (written in English) are mostly positive. This is a good sign, as the company maintains multilingual support. 

 

Trading conditions

 

Trading instruments (cryptocurrencies)

As mentioned above trading at BitFlyer is done against the Japanese Yen. This applies for the plethora of Bitcoin instruments, which include Spot BTC trading, Margin BTC trading, and BTC Futures (not to be confused with Bitcoin Cash Futures). Furthermore Etereum is available for trading, against Bitcoin.

 

Minimum initial deposit

BitFlyer does not give any guidelines about a minimum deposit level. Forex brokers, on the other hand usually announce their minimum entry barriers. For instance, you can open an account with XM, with only $5.

 

Leverage

BitFlyer offers a maximum leverage ratio of 1:15. However, in order to be allowed to trade on margin, one must go through a tougher verification process. This type of ratio may sound very small to someone who is used to forex trading, as lots of brokers provide 1:500 or even higher levels. 

 

Do keep in mind cryptocurrencies often move far more wildly than fiat currencies. While a major pair will rarel move more than 1.5 – 2% percent per day, the Bitcoin often has gains or losses exceeding 10%. This explains the lower leverage offering by BitFlyer, which by the way is one of the highest offers provided by crypto-exchanges. For a full comparison of trading Bitcoin with a forex broker and on an exchange click here.

 

Fees

Fees at BitFlyer vary slightly for the different services, which they provide. They offer directly exchanging JPY to BTC, the fees for which go as high as 0.15% for the lowest volume traders. As a comparisson, Bitfinex charges this type of fee only for the market "makers", while takers pay a slightly higher one. The maximum fee for ETH/BTC is 0.20%. Here is the full information, as provided by the company (click to zoom-in):

 

 

Lightning FX stands for the margin trading of BTC/JPY. Futures on the other hand are similar to exchange traded futures. However the liquidity in them appears to be far lower, which is to be expected. We would not recommend them to inexperienced traders.

 

 

Trading platform

 

BitFlyer provides two trading platforms. They are both web based, which is not unusual for cryptocurrency exchanges. One of them is the so called Bitcoin Easy Exchange, which serves, to facilitate direct JPY to BTC transfers. It is what people, who want to get their funds converted to Bitcoin, before transferring them would use. Albeit simple, it does the job. Here is a preview (click to zoom-in):

 

 

 

The company also offers the BitFlyer Lightning platform. It feels much more like a forex trading platform, as it is designed with the trader in mind. This is the platform where the 1:15 leverage ratio is provided. Here is what platform looks like (click to zoom-in):

 

 

There is a chart on the left, with lots pre-loaded indicators. The order book looks pretty solid (in the middle) and the tape is locate on the right. Several more fields are located below these, similarly to the MetaTrader 4 (MT4) terminal. Charting appears to be decent, with several technical indicators in place. Furthermore the charts can be set to full-screen mode.

 

There are multiple themes available, if you do not like the black and orange feel. One thing we must mention are the maddening sounds, which are turned on by default. Every time a transaction is made, more importantly, every time there is a movement of a bid/ask in the order book, play a sound. Luckily, these can be turned off quite easily.

 

Methods of payment

 

BitFlyer accepts Bank Transfers, Credit Cards issued in Japan and Bitcoin transfers. Although the company has a clear focus on its internal market, a foreigner can still use their services, albeit not with his credit card. Users of online payment systems, such as Skrill are also left out.

 

Conclusion

 

BitFlyer is the number one cryptocurrency exchange in Japan. It also rates pretty highly among the global volume charts. The most specific thing is that trading is done against the Japanese Yen (JPY). There are multiple platforms and services available, including margin trading. Despite being focused on its domestic market, the company appears to be reaching out to the rest of the world and with commission levels so low, customers will come. Here is a summary BitFlyer’s pros and cons:

 

Pros Cons
No major hacks yet Trading against JPY
Accepts Bank Transfer and Japanese Credit Card Does not accept Credit Card, from countries other than Japan
Competitive commissions No altcoins available (ex. ETH)
Relatively nice trading platform  
Allows margin trading and futures  

 

GDAX

GDAX Review
Trader's rating 1
Editor's rating 4

Trading Accounts

 

Account type Minimum deposit Leverage Maker Fee Taker Fee
Standard Undisclosed 1:3 0% Up to 0.25%

 

GDAX, which stands for Global Digital Asset Exchange, is a company owned by Coinbase. While some of you may know Coinbase for the ability to purchase Bitcoin directly by Credit Card, GDAX is the other part of the company – the exchange aimed at traders. Trading fees at GDAX are much lower and margin trading is available.

 

The company, security of funds

 

Company Country Regulation
Coinbase USA NY BitLicense

 

As mentioned above GDAX is actually a part of San Francisco – based Coinbase. The company holds the New York BitLicnese, which is by its nature an interesting piece of legislation. The New York Department of Financial Services (NYDFS) attempted to make the city a major Bitcoin trading center, the same way it hosts the world’s largest stock exchange. One may argue the idea backfired, as a lot of the key players backed-out of the 2015 proposal. This is due to the burdensome and slow regulatory procedure. As of the summer of 2017 only three companies have received the license and Coinbase is one of them.

 

When it comes to hacking, a major attack has not struck GDAX or Coinbase. That being the case, there was a “flash crash” in Ethereum prices, which raises suspicion. The coin was trading at around $317, when it suddenly spiked to an alleged value of 10 cents and quickly retraced. The company proceeded to halt trading and later claimed this was merely a “fat finger” - single large trader accidentally placed a market sell order, which triggered a chain of stop-loss orders to be executed. Here is а live video, shot by a trader, who has connected a MetaTrader4 platform to his GDAX account (the interesting thing happens around 2:50):

 

 

The public’s concerns, of course, come from the fact GDAX offers margin trading. The company could have manipulated the price, in order to wipe-out traders who were long. All of this is purely speculation.

 

 

Other than this case, the user reviews for GDAX generally match the ones for Coinbase. One of the major concerns of the fans of decentralization in the cryptoverse, is the fact a lot of the investors behind the project are well-established in the traditional financial sector.

 

Trading conditions

 

Trading instruments (cryptocurrencies)

Only three crypto currencies are available at GDAX, namelyBitcoin, Ethereum and Litecoin. Trading is done against USD and EUR, with BTC/GBP also being available, alongside the crypto-crosses ETH/BTC and LTC/BTC.

 

Minimum initial deposit

There is no information on the minimum initial deposit at GDAX, which is not that unusual in the crypto currency sphere. On the other hand, most forex brokers have such a level and disclose it on their websites. For instance the FCA-regulated industry pioneers at IG (who also offer some coins as CFDs) proudly announce they do not have a minimum – you can open an account for as low as you want.

 

Leverage

Margin trading is available on GDAX, with a maximum leverage ratio of 1:3. While this may sound like nothing in comparison to the 1:500, which a lot of forex brokers offer, keep in mind such high levels only apply for fiat currencies, which rarely have price movements bigger than 1-2% per day. 

 

When it comes to crypto, the aforementioned broker IG offers 1:13 in leverage (a 7.5% margin requirement). For a full comparison between crypto-exchanges and forex brokers, who offer Bitcoin trading, read this article.

 

Fees

The costs of trading at GDAX are a lot lower than the ones available at Coinbase. When trading on the exchange, market “makers” (the people who place passive orders and wait for other traders to trigger them) do not pay a fee. Market “takers” (i.e. the “aggressive” traders who directly buy/sell with a market order) pay fees starting from 0.25% and going down for the bigger traders. Both of these levels (especially the free of charge passive trading) are very competitive.

 

Trading platform

 

The platform provided by GDAX, which is web-based, is a lot better than the one offered at Coinbase. That being said, we find the charting lacking when compared to the charts provided by TradigView (which other exchanges have integrated, as well as MetaTrader4, of course. Only a couple of predetermined moving averages are available, in terms of technical indicators. Here is a preview (click to zoom-in):

 

 

The order book is located at the left and the more bizarre design decision to place the “ask” column on top of the “bids” is made. While this may seem strange to experienced traders it does provide a nice graphical representation for beginners. The tape is located to the left, with the middle ground being taken by the chart (which is nothing special) and the open positions tab. 

 

Methods of payment

 

While Coinbase is obviously the main source of clients (and funds) for GDAX, money can also be sent directly to the exchange. This is a massive convenience tool, as accounts can be funded, without the need of paying the hefty Coinbase fees. That being said, Credit/Debit Card deposits can only be made via Coinbase, while GDAX accepts Bank transfers.

 

Conclusion

 

GDAX is a part of Coinbase and more specifically the part of the company, which is targeting more active traders. The fee structure is very competitive, especially with the free market “maker” trades. The selection of trading assets is not great, but the trading platform feels relatively nice (although charting is nothing special). Here is a summary of GDAX: 

 

Pros Cons
New York BitLicense Few altcoins available
Competitive trading fees Suspicion regarding the ETH spike
No major hacks yet  
Accepts Bank Transfers  
Relatively nice trading platform  

 

Forex
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