What is Bitcoin Exchange?
A bitcoin exchange is similar to the stock exchange. It is a digital marketplace where various bitcoin traders (or buyers and sellers) exchange bitcoins for fiat currencies (currencies declared to be legal tenders by government regulation) and altcoins (which simply means “alternative coins”, other cryptocurrencies created after bitcoin such as Dash, Ripple, Ethereum).
How to exchange bitcoin for US Dollar and other Altcoins?
Before you start trading, it is important you understand that there are different types of bitcoin (or any cryptocurrency) exchange. Trading platforms help connect buyers and sellers of bitcoin and collect a fee from every transaction These direct trading platforms do not have a fixed price but work with exchange rates set by the sellers. Brokers are similar to foreign exchange dealers and they set prices for anyone who is interested in buying cryptocurrencies.
Now, to exchange bitcoins for other altcoins or fiat money, all you have to do is head on over to a cryptocurrency exchange site. There are many out there, so it is important you select one with good reputation and service. Many platforms give traders the option to buy and sell by inputting a market order or limit order. Market order enables the buyer to trade his/her coins for the best available price on the online marketplace while limit order directs the exchange to trade coins for a price below the current ask.
Some online platforms for bitcoin exchange require you to sign up with your email, where a link would be sent to confirm your account. After you have opened an account, all you have to do is select the amount of bitcoins you want to exchange and what you would like to exchange it with, transfer it to you exchange account and within a specified time (usually minutes) you will get your converted new cryptocurrency.
If you want to convert your bitcoin to fiat money like the US Dollar, you will be required to input your PayPal details and simply select the “from Bitcoin” and “to PayPal” options. You will then send the coins you wish to exchange to the platform or any unique address sent to you by the platform. Once the transfer of the bitcoins has been confirmed, the platform would then send the amount in US Dollars to your PayPal account.
What is Bitcoin Exchange rate?
The price and market capitalization of bitcoin changes frequently but you can always get the latest price and market capitalization by clicking on “right now” button on the page.
What determines Bitcoin Exchange Rate?
Bitcoin exchange rates are determined simply by supply and demand. When the demand for bitcoins increases, the exchange rate increases and when the demand falls, the exchange rate also decreases.
How to transfer bitcoin from exchange to wallet
When you newly download a wallet for storing your new coins, encrypt the wallet with a good passphrase. After that, generate a new address for the purpose of receiving. It is advisable for you to generate a new address for every transaction for security purposes. After generating the new address, copy it and send your coins from the bitcoin exchange account to the newly created address.