Top 7 crypto exchanges of 2024: a comprehensive guide to security, technology, and trustworthiness

In the ever-evolving world of cryptocurrency, centralized exchanges have become pivotal platforms for trading and managing digital assets. With so many options available, knowing which crypto exchange offers the best security, liquidity, and overall experience is essential. Below, we dive into the top centralized exchanges of 2024, evaluating them on governance, business practices, liquidity, security, technology, and data quality. Let’s explore how platforms like Coinbase, Binance, Kraken, and others stack up and highlight some best practices to keep your assets safe.

Why choose centralized exchanges?

Centralized exchanges (CEXs) streamline the buying, selling, and trading of digital assets, making them ideal for beginners and experienced traders alike. However, CEXs come with trade-offs. While they offer advanced trading options and liquidity, they control your private keys, meaning you don’t have direct ownership of your crypto. We’ll discuss the importance of keeping your keys in a separate wallet later in this article.

Evaluation criteria and calculation methodology

Each score (out of 10) is calculated based on several sub-criteria, industry benchmarks, and recent performance data. Here’s a breakdown of what each criterion measures and how the scores are calculated.

Governance Score

• Definition: Assesses the transparency, regulatory compliance, leadership structure, and accountability measures of each exchange.
• Factors Considered:
  • Regulatory Compliance: Evaluates the exchange’s adherence to regional and international laws.
  • Transparency: Considers public disclosures, audits, and company communications.
  • Leadership Accountability: Evaluates the leadership structure and decision-making processes.
• Calculation: Exchanges with a strong track record of regulatory adherence and transparent policies received higher scores. For instance, Coinbase and Gemini, which are more heavily regulated and transparent, scored higher in governance than Binance, which operates more independently.

Business Score

• Definition: Reviews the exchange’s business model, growth stability, profitability, and customer service.
• Factors Considered:
  • Revenue Model and Sustainability: Considers how the exchange makes money and its profitability.
  • Customer Service: Examines user feedback on support and issue resolution.
  • Growth Trends: Looks at user acquisition, trading volumes, and partnerships.
• Calculation: Exchanges with reliable and responsive customer service and a sustainable growth strategy scored well. Binance, with a wide user base and varied product offerings, scored higher, while Bitstamp, with a more niche audience, scored slightly lower.

Liquidity Score

• Definition: Measures the exchange’s ability to handle high trade volumes without significant slippage or price distortion.
• Factors Considered:
  • Trading Volume: Assesses the 24-hour average trading volumes across major pairs.
  • Market Depth: Examines the order book’s depth to support large trades.
  • Spread: Evaluates the bid-ask spread consistency for various assets.
• Calculation: Liquidity scores reflect the exchange’s ability to process high trading volumes efficiently. Binance, known for its massive daily trading volumes, scored the highest, while Bitstamp and Kraken, with less volume, scored moderately lower.

Security Score

• Definition: Rates the platform’s security infrastructure and history of handling security breaches.
• Factors Considered:
  • Infrastructure Security: Evaluates security protocols, encryption, and multi-factor authentication.
  • Cold Storage Usage: Assesses how much of user assets are stored offline.
  • Incident Response: Considers how past security breaches were managed, if any.
• Calculation: Exchanges with a flawless or minimal incident history scored higher in security. For instance, Kraken and Gemini, known for strong security practices, received higher scores. Binance, which experienced a security breach in 2019, scored slightly lower but still has strong protocols.

Technology Score

• Definition: Assesses the technological capabilities, features, user experience, and innovative offerings of each exchange.
• Factors Considered:
  • Platform Stability: Evaluates downtime frequency, especially during high market activity.
  • Feature Set: Assesses trading options like spot, futures, margin, and advanced analytics.
  • User Interface: Looks at the design and ease of use for both beginners and advanced users.
• Calculation: Exchanges with robust platforms that support a range of advanced trading tools scored higher. Binance, known for its versatile trading options and smooth platform performance, scored high, while Bitstamp, which offers fewer features, scored lower.

Data Quality Score

• Definition: Evaluates the reliability and accuracy of the data provided by the exchange, including pricing, volume, and market analysis.
• Factors Considered:
  • Real-Time Data Accuracy: Assesses the precision of price quotes and market data updates.
  • Order Book Transparency: Considers the clarity of order book data and any discrepancies reported.
  • Market Analysis Tools: Evaluates the quality of in-platform analytics and insights.
• Calculation: Exchanges with real-time, reliable data reporting scored higher, especially those with transparency in order book and market depth. Coinbase and Gemini, which prioritize data accuracy and transparency, scored well, while others with occasional reporting inconsistencies scored slightly lower.

Top Centralized Crypto Exchanges of 2024

Coinbase

• Governance Score: 9.5/10
• Business Score: 9/10
• Liquidity Score: 9.5/10
• Security Score: 9/10
• Technology Score: 9/10
• Data Quality Score: 9/10

Coinbase remains one of the most trusted exchanges worldwide. With a transparent business model, high governance standards, and regulatory compliance in multiple regions, Coinbase is popular with both institutional and retail investors. Security is paramount, and Coinbase uses sophisticated encryption and cold storage for most assets, giving it a high-security score. Its user-friendly interface makes it ideal for newcomers, while more advanced users appreciate Coinbase Pro for deeper market insights.

Binance

• Governance Score: 8.5/10
• Business Score: 9.5/10
• Liquidity Score: 10/10
• Security Score: 8.5/10
• Technology Score: 9.5/10
• Data Quality Score: 9/10

Binance is a top choice for its liquidity, providing seamless trading options for a vast range of cryptocurrencies. Binance has some of the most robust technology in the industry, supporting advanced features like futures trading, staking, and lending. However, governance issues have been a topic of discussion as it operates without a unified regulatory jurisdiction. Security is strong but not without incidents, as Binance continually improves its protocols.

Kraken

• Governance Score: 9/10
• Business Score: 9/10
• Liquidity Score: 8.5/10
• Security Score: 9.5/10
• Technology Score: 8.5/10
• Data Quality Score: 8.5/10

Kraken is one of the most secure exchanges available, with a strong emphasis on compliance and transparency. Based in the U.S., it offers top-tier security and has maintained an excellent track record. Kraken’s governance score is high due to its adherence to regulatory standards and responsible business practices. Although Kraken’s liquidity is slightly less than Binance’s, it remains strong for major pairs. The platform’s solid data quality and security measures make it a reliable option for security-conscious traders.

Bitstamp

• Governance Score: 9/10
• Business Score: 8.5/10
• Liquidity Score: 8/10
• Security Score: 8.5/10
• Technology Score: 8/10
• Data Quality Score: 8/10

Bitstamp, one of the longest-standing exchanges, is known for its reliability and transparency. Its governance practices are solid, focusing on long-term growth and compliance. Bitstamp’s interface is simple, making it suitable for beginners, though its liquidity may not be as high as Binance or Coinbase. Security measures are robust, with regular audits and strict protocols in place.

Gemini

• Governance Score: 9.5/10
• Business Score: 9/10
• Liquidity Score: 8.5/10
• Security Score: 9.5/10
• Technology Score: 8.5/10
• Data Quality Score: 9/10

Gemini, founded by the Winklevoss twins, is committed to regulatory compliance and user security. With licenses in the U.S. and high standards for business ethics, Gemini scores well in governance and business categories. The platform’s high-security score is due to its stringent policies and secure infrastructure. Although liquidity is slightly lower than some competitors, Gemini’s focus on transparent operations makes it a solid choice for those valuing compliance and security.

Crypto.com

• Governance Score: 8/10
• Business Score: 8.5/10
• Liquidity Score: 9/10
• Security Score: 8.5/10
• Technology Score: 8.5/10
• Data Quality Score: 8/10

Crypto.com’s rapid rise is marked by a focus on accessibility and growth. Offering a variety of services, from staking to NFTs, Crypto.com provides high liquidity across many tokens. While governance and security are strong, some users report concerns over the platform’s sometimes slow support response. However, it’s a competitive choice for those looking to access diverse crypto services.

OKX

• Governance Score: 8/10
• Business Score: 8/10
• Liquidity Score: 9/10
• Security Score: 8.5/10
• Technology Score: 9/10
• Data Quality Score: 8.5/10

OKX is an innovative platform with a focus on high-volume trading and advanced technology features, such as an integrated DeFi ecosystem. OKX offers strong liquidity and a vast range of supported tokens. Although not as widely known as Binance or Coinbase, it remains a powerful contender for those needing advanced trading tools and diversified digital assets.

Comparative Table

The table below summarizes the comparative scores (out of 10) of each major centralized exchange across six key evaluation criteria: Governance, Business Practices, Liquidity, Security, Technology, and Data Quality.

Top Crypto Exchanges in Specific Areas

This comparative analysis helps highlight which exchanges perform best in specific areas.

• Best for Security: Kraken and Gemini
• Highest Liquidity: Binance
• Top in Governance: Coinbase and Gemini
• Best Technology: Binance and OKX

Each of these top exchanges is built for trading, not storage, and keeping crypto assets on an exchange for extended periods is discouraged. Transferring funds to a private wallet (such as a hardware wallet) provides you with complete ownership over your keys, enhancing the security of your holdings.

Why Centralized Exchanges Shouldn’t Be Used as Wallets

Centralized exchanges are convenient, but they aren’t suitable for long-term storage. When you hold your funds in an exchange, the exchange retains the private keys to your assets. This arrangement means that if the exchange experiences a breach or if regulatory issues arise, your access to your assets could be impacted.

To truly own your cryptocurrency, it’s recommended to transfer funds to a secure external wallet. Here, “not your keys, not your crypto” is a vital rule to remember. By holding your private keys in a non-custodial wallet, you ensure complete control over your assets and reduce the risks associated with centralized platforms. Cold wallets, hardware wallets, and decentralized wallets are some of the best options for safeguarding your crypto.

Conclusion

Each of these top centralized crypto exchanges in 2024 — whether Coinbase, Binance, Kraken, Gemini, or others — brings unique strengths to the table. For the best experience, consider factors like liquidity, governance, and technology, and always prioritize security. Remember, while centralized exchanges offer trading ease, using them as long-term wallets is risky. Take control of your assets by moving them to a private wallet where you hold the keys, ensuring your crypto investments are as secure as possible.