The World’s Most Trustworthy Crypto Exchanges And Marketplaces

Forbes

After years of turbulence, including jail time for the founders of the two biggest cryptocurrency exchanges, many providers are getting serious about controls and regulation. Coinbase leads our list of the 20 most trustworthy marketplaces in an industry that still requires caution.  Read the full story on Forbes: https://www.forbes.com/sites/javierpaz/2024/05/15/the-worlds-best-crypto-exchanges-and-marketplaces/?sh=594fcfab1755  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00 Here's your Forbes daily briefing for Sunday, May 19th.

00:05 Today on Forbes, the world's most trustworthy crypto exchanges and marketplaces.

00:11 With the sentencing of former industry kingpins Sam Bankman-Fried and Changpeng Zhao, the

00:17 cryptocurrency exchange business is by necessity moving toward a more transparent and compliant

00:21 model.

00:22 The transformation has been made easier by a doubling in the price of Bitcoin over the

00:26 past year.

00:27 It is now trading at $61,568.

00:32 That doubling has been powered in part by the influx of about $11.8 billion into newly

00:37 allowed U.S. exchange-traded funds based on the spot price of the cryptocurrency.

00:43 These ETFs, offered by sponsors including BlackRock and Fidelity, are bringing new credibility

00:48 to the digital assets industry, whose reputation has been sullied by a string of bankruptcies

00:53 in 2022 that culminated in the failure of Bankman-Fried's FTX exchange.

00:58 FTX was run in a criminally haphazard way, leading to the former CEO's conviction on

01:03 seven counts of fraud, money laundering and campaign finance violations and a 25-year

01:08 prison sentence.

01:10 Zhao's Binance ran afoul of U.S. authorities and pleaded guilty to breaking anti-money

01:15 laundering laws, as well as to unlicensed money transmitting and sanctions violations.

01:21 The exchange had to pay $4.3 billion of restitution, and Zhao himself admitted to a single charge

01:27 of failing to implement an effective anti-money laundering program at Binance, for which he

01:32 was fined $50 million and sentenced to four months in prison.

01:37 Binance remains the world's largest cryptocurrency exchange by average daily trading volume,

01:42 but you will not find it among the firms we ranked.

01:45 We excluded Binance and BitMEX from our 2024 ranking because of their legal and regulatory

01:50 infractions.

01:52 Aside from its problems with the U.S., Binance was expelled from at least 17 countries in

01:57 the past three years, including India, the U.K. and Japan.

02:02 One of its reputational issues has to do with not having a fixed headquarters and therefore

02:06 no home regulator for the majority of its business.

02:10 Other large exchanges excluded from our ranking include OKEx, MEXC and KuCoin due to lack

02:17 of credible regulatory oversight and what we perceive to be weak internal controls.

02:23 Most of our 20 trustworthy exchanges are based in nations with significant oversight of their

02:27 financial markets.

02:29 The top three are all in the United States.

02:32 We considered 646 exchanges and other kinds of marketplaces that allow investors to trade

02:37 crypto and narrowed down the list based on nine different criteria.

02:43 Leading the 2024 ranking is publicly traded Coinbase, which is not only an exchange, but

02:48 a top cryptocurrency custodian.

02:50 It has been entrusted with 13 percent of the world's Bitcoin and Ethereum supply and 40

02:55 percent of all crypto assets held on exchanges, a key indicator of trustworthiness.

03:02 It gets the highest possible score for regulation, although it is not without issues with government

03:06 overseers.

03:07 It is currently embroiled in court actions with the Securities and Exchange Commission,

03:11 which considers almost all digital currencies other than Bitcoin to be securities.

03:15 It therefore considers Coinbase, which makes markets in no fewer than 260 tokens, to be

03:21 an unlicensed broker dealer.

03:24 But Coinbase's issues are civil, not criminal, and it also gets top marks for the quality

03:29 of its audits and for its acceptance among institutional investors.

03:34 Coinbase also topped our 2022 list.

03:38 The runner up is not properly a crypto exchange at all.

03:41 CME Group is the largest regulated crypto marketplace and the closest thing to the arbiter

03:46 of official Bitcoin and Ethereum prices.

03:49 With roots in the old school Chicago commodities markets, it has more than $2 trillion in U.S.

03:54 Treasury futures, trillions in other asset classes, and more than $9 billion worth of

04:00 regulated crypto futures contracts outstanding, the most in the world.

04:05 ETF issuers such as ProShares, as well as retail traders and hedge funds, use the CME

04:11 for hedging and speculating on future prices of Bitcoin and Ethereum.

04:17 In the world of cryptocurrencies, the difference between exchanges and brokers can often appear

04:21 to be a matter of semantics.

04:24 For most investors, cryptocurrency exchanges are indistinguishable from securities brokers.

04:28 They are the middlemen you go through to buy or sell digital assets.

04:33 With this in mind, we have included discount stock broker Robinhood and Fidelity on our

04:37 list.

04:38 Robinhood has zero fees on crypto transactions compared to Coinbase, which charges a $6-$17

04:44 fee per $1,000 of Bitcoin purchased.

04:48 Most other crypto exchanges on our list charge transaction fees, ranging up to 0.2%.

04:54 Robinhood would have scored even higher, but was held back by its lack of institutional

04:58 traders and derivatives.

05:00 Like Coinbase, it has come under scrutiny by the SEC.

05:05 For full coverage and to see the whole list and Forbes' methodology in creating it, check

05:10 out Javier Paz's piece on Forbes.com.

05:14 This is Kieran Meadows from Forbes.

05:17 Thanks for tuning in.

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