Three or four years ago, many people saw cryptocurrency as a fly-by-night fad. But this so-called short-lived craze has evolved into a significant revenue generator. One that's changing the face of finance.
An increasing number of banking institutions are looking for ways to incorporate crypto into their service offerings. This year, hundreds of American banks will add Bitcoin to their list of capabilities.
But the fascinating crypto-related developments don't end there. The Federal Reserve is even getting in on the action with its recent announcement of a potential digital dollar. Of course, platforms like Bybit and Kraken remain among your best digital currency trading options.
How do they compare, and which one will best meet your crypto investment needs? Let's take a closer look at these two crypto trading companies and how they stack up.
The Race for Crypto to Buy Right Now
Whether it's Ripple, Dogecoin, Ethereum, or Bitcoin, a growing number of consumers have started tapping into the investment potential associated with cryptocurrencies.
As a growing number of users muse the question, "Which crypto to buy right now?," countless exchanges have arisen to meet this new demand. Of course, not all of these exchanges are created equal.
They vary in significant areas, from fees to supported currencies. What's more, they may only provide services to some countries, and their security measures vary, too.
As a result, you'll need to consider multiple factors before deciding on the best exchange for your financial needs. Here's what you need to know about Bybit and Kraken and how they compare in some of these areas.
What Is Bybit?
A Singapore-based peer-to-peer (P2P) crypto futures exchange, Bybit exchange started in 2018 with an edge on the game. After all, there aren't many platforms that specialize in this area of the market. But there's more to Bybit's edge than simply offering a needed service.
The company also boasts an excellent team that brings plenty of experience in the financial sector and blockchain tech to the table. It offers perpetual futures products, providing leverage of 100:1.
As a result, Bybit has positioned itself to go neck to neck with other exchanges such as Deribit and BitMEX.
What else do you need to know about this company? Bybit faces restrictions in some countries as a result of current legislation. These restrictions apply to users in parts of Canada, Syria, and the US.
That said, we foresee greater accessibility for customers living in these nations moving forward. After all, Bybit's market presence continues to grow, and we anticipate worldwide acceptance in the near future.
What Is Kraken?
Founded in 2011 and launched in 2013 in San Francisco, Kraken exchange represents a fully functional crypto platform known for its robust mix of supported coins and low fees.
It also holds the distinction of being one of the only American exchanges to offer advanced tools and resources. These include margin trading capabilities.
The company aims to be the "best and most secure" crypto trading platform out there and has the reputation to prove it. Kraken had consistently led the competition regarding security matters, and it boasts some of the best financial stability and physical security in crypto.
What's more, the platform encourages users to practise healthy security habits, which represents the first and most important line of defence. But Kraken is no a watered-down, easy-to-use exchange. And we don't recommend it for beginners.
But it's hard to beat Kraken's stellar reputation and choice of nearly 60 supported coins. For investors in the US who have trouble finding exchanges that don't restrict them, Kraken represents one of the best options out there.
Bybit vs Kraken: Fees
What's one of the most important factors to consider when choosing a crypto exchange? Trading fees (or transaction fees). This statement proves especially true if you're going for a futures option where you must shell out a significantly higher amount than your original margin.
With that in mind, how do Bybit and Kraken compare when it comes to trading fees, withdrawal fees, and other potential charges? Let's take a closer look at each exchange's policies.
Fee calculation can get complicated when it comes to some crypto exchanges. But you'll never have this problem with Bybit.
The platform features a practical and straightforward way to calculate fees, and they only charge when you take liquidity off the market. Like many exchanges, Bybit follows the maker-taker model.
Takers pay 0.075%, and makers can earn up to a 0.025% rebate. In the process, Bybit earns roughly 0.05% on these maker and taker fees. Currently, spot trading fees sit at 0.2%.
Like Bybit, Kraken also bases fees on the maker-taker model. But unlike Bybit, they offer one of the lowest transaction fees in the industry. This fee ranges from 0.025% to 0.010% based on each user's trading volume over the past 30 days.
Savvy traders and investors will also find ways to enjoy additional savings. For example, makers who add liquidity to the exchange through limit orders will see further fee decreases.
When using Kraken, deposits are usually free. That said, Kraken sometimes charges a nominal fee for setting up the address, so you'll want to inquire before making any deposits.
Kraken vs Bybit: Withdrawals
How do Kraken and Bybit compare in other areas such as withdrawals? There are some significant differences worth noting when it comes to depositing capabilities and how long they take.
Kraken: What to Know About Deposits
Kraken permits traders to withdraw and deposit funds in cryptocurrencies and fiat, which gives it a distinct advantage over Bybit. (We'll come back to this in the next section.)
That said, you'll want to research these features before committing to the platform as fiat currency choices prove restricted.
Deposits typically take between one and five business days. They can be done through SEPA or SWIFT as well as wire transfers.
Bybit: What to Know About Deposits
How does Bybit fit into the mix when it comes to deposits? Unlike many other exchanges that have started accepting fiat, Bybit remains narrowly focused on cryptocurrencies.
This strategy comes with a couple of easily overcome cons. You could make the argument that Bybit suffers in the areas of usability and attracting more customers because of its narrow focus on digital currencies.
After all, you can't deposit or withdraw funds in fiat. Although this creates an additional step, given the vast array of options on the market, most users don't miss a beat. These customers transfer their funds from ByBit wallets to other platforms and then convert what they need into fiat.
Bybit vs Kraken: Security Matters
Perhaps one of the scariest areas for new digital currency investors as well as crypto enthusiasts is security. After all, we've all heard terrifying news stories about hacking and fraud issues. Even big names like Binance haven't gone untouched by the spectre of security breaches.
Keeping funds safe starts with learning and practising the best practices in user safety. Beyond learning to recognize the telltale signs of phishing schemes and other risky situations, platforms have upped their security protocols in recent years.
With that in mind, let's take a closer look at how Bybit and Kraken compare in this vitally important area.
Bybit's Security Protocols
Bybit has implemented a robust security system designed to keep its user's money safe. These features include storing most user coins in cold wallets offline.
This all-important yet straightforward step puts an almost impenetrable barrier between hackers and consumer funds. The company also places a premium on coin safety when assets must be moved from a secure vault.
The team at Bybit relies on a multi-signature address mechanism to ratchet up the difficulty with which malicious elements can attempt to trace user transactions.
The website also comes with an SSL certificate as a standard feature. This certificate encrypts all the data transmitted between the exchange and its clients.
The result? A powerful antidote to sniffing and phishing attacks.
Kraken's Security Protocols
We've already briefly mentioned Kraken's impressive security features, but let's take a closer look at how these features protect client money. Kraken relies on state-of-the-art security to protect the privacy and funds of its clients.
The company also has two-factor authentication (2FA) in place at the time. You'll notice it during withdrawals as well as anytime you need to verify your ID before fund transfers.
But the safeguards don't stop there. Kraken boasts a Global Settings Lock. This lock prevents unauthorized access of your funds by blocking IP addresses not associated with your account. We expect to see more crypto market companies adopt similar features in the future.
These additional layers of security provide peace of mind for individuals involved in crypto investment.
Kraken vs Bybit: The Takeaway
When it comes to making your next trade crypto, which of these two exchanges deserves your business? The answer to this question depends on how you feel about the three core areas where these two platforms compete.
For example, it's hard to beat the level of security you'll enjoy with Kraken. Because the exchange accepts a limited number of fiat currencies, you can also cut steps out of your crypto routine.
That said, you stand to get up to 100x leverage with Bybit as opposed to 50x with Kraken. And you'll never have to pay deposit fees with Bybit, although you could face some with Kraken.
Are you interested in exploring other exchanges to see how they compare to Bybit and Kraken? Check out our complete exchange listings for 2021 now.