Activity in the online trading world is one of the key factors that will determine how successful you can be. Learning the basics, tracking the price of Bitcoin (BTC) et al, and reading the crypto headlines are all important tools. However, if the exchange you’re using doesn’t have any trading volume, you can’t put your skills into practice.

Before we rank cryptocurrency exchanges by volume, we’ve broken down exactly how activity is defined in the trading world.

What is trading volume and how does it affect you?

crypto trading volume
Source: Wit Olszewski/Shutterstock.com

Closely linked to liquidity, trading volume is the term used to describe the number of coins bought and sold over a certain time period. In general, cryptocurrency trading volume is tracked over a 24-hour period. When you’re assessing the trading volume of a particular exchange, it’s important to note that volume may be a total figure or an individual figure.

For example, it’s possible to rank cryptocurrency exchanges by volume based on the total number of coins traded in a day. Binance is one of the largest exchanges in the industry. When you look at the number of digital coins bought/sold (it offers 150) and the USD value of each coin traded added together, the average daily trading volume at this exchange is $753 million. That figure puts it among the top-five crypto exchanges by volume in the world and, therefore, an active place to invest.

However, what you can also do when you’re sizing up an exchange is to look at the trading volume of individual assets. For instance, just because Binance is a big player when it comes to overall volume, it may be lacking when it comes to Litecoin (LTC) activity. So, by looking at individual stats, you can see which exchanges are best for you and the digital tokens you want to trade.

Naturally, the more trading volume an exchange has, the more chances you’ll have to buy/sell at the best price. Activity makes it possible to complete orders in less time; therefore, you’ll get the price you expect when volume is high.

Can you make more money from high-volume exchanges?

cryptocurrency exchange volume
Source: Wit Olszewski/Shutterstock.com

In theory, yes. However, it’s important to understand that high trading volume doesn’t automatically mean you’ll make more money. The reason it’s possible to make more at the top-ranked high-volume crypto exchanges is because they allow you to access better conditions. As we’ve discussed in our guide to liquidity, lag can cause you to lose money. If you see a price you want to buy/sell at but the exchange has low trading volume, it may take a few minutes to buy or sell tokens. If the price changes during the delay, you’ll be forced to take the new price or cancel the order.

Therefore, if you can find a high-volume cryptocurrency exchange, you stand a better chance of executing orders at the price you want. What’s more, because there’s a greater level of activity, you can be confident the prices are the best they’re going to be. Finally, from a stability standpoint, crypto exchanges with a lot of trading volume are going to be making more money which, in turn, means they’re less likely to go bust and leave you without a place to trade.

Ranking cryptocurrency exchanges by volume

You can read our cryptocurrency exchange reviews to get an insight into the nuances of each platform. However, to ensure you’re able to join sites with the most activity, we’ve ranked our recommended cryptocurrency exchanges by volume in the list below:

Add Comment