# How to identify the safest exchange for your cryptocurrency trading

**TL;DR: In my opinion [flyp.me](https://flyp.me) is the safest exchange. This because flyp.me does not expose me to the risk of a hacker attack and one remains in possession of its coins at all times. You can read more about why I think [flyp.me](https://flyp.me) is the [safest exchange](https://flyp.me) below.**

This short example from history is intended to illustrate why it is important to know and use the safest exchange.
By 2014 at the latest, when the Bitcoin trading platform Mt. Gox filed for bankruptcy, everyone became aware of the risks they faced when trading on such platforms and the confidence they placed in them. Estimates speak of around 650,000 bitcoins that Mt. Gox lost. These bitcoins actually belong to the clients of the Trading Platform.
With this somewhat frightening example, it is much easier to take the stony road and find the safest exchange (and also know why it is the safest exchange).

## What makes an exchange safe (and what does the safest exchange need)
To determine what is making an exchange safe, we must first become aware of the risks we are exposed to when using exchanges. With this knowledge we will later be able to find out which is the safest exchange.
1. Hackers steal all coins deposited on a trading platform. [[1]](http://money.cnn.com/2017/12/20/technology/south-korea-bitcoin-exchange-closes/)
2. An exchange trades more bitcoins than it effectively has. If too many customers want to withdraw their Bitcoins at once, they are facing bankruptcy or the customer cannot withdraw their Bitcoins.
3. A exchange goes offline for a certain period of time because the platform is not stable and customers therefore have no access to their coins. [[2]](https://www.bloomberg.com/news/articles/2018-01-12/crypto-exchange-kraken-goes-dark-and-user-anxiety-surges)
4. An exchange blocks an account at the request of a government agency and all coins in that account can no longer be withdrawn.

These are just a few of the dangers that traditional exchanges expose us to.
The safest exchange is the one that protects us from such possible dangers or makes it impossible for them to arise.

### Exchanges getting hacked
With traditional exchanges you deposit your coins, trade with them and they remain on the exchange most of the time.There is a simple reason for this: most exchanges require a high number of confirmations until a transaction is considered valid.
Poloniex, for example, requested 999 confirmations until a Gridcoin transaction was considered valid. 999 confirmations mean about 24h waiting time. This waiting time makes trading impossible if you withdraw your funds from the exchange every time. This is why most users have their coins on an exchange.
Instant exchanges like [flyp.me](https://flyp.me), on the other hand, allow you to trade with a very small number of confirmations and thus the coins can be in your wallet at any time. Therefore it is already clear to me that the safest exchange can only be an instant exchange!

### Exchanges having less coins than claimed
Since with traditional exchanges the coins usually remain on the platform, they can sell more coins than they actually own. However, if everyone wants to withdraw at once, the exchange collapses.
So in that case the instant exchanges will be the safest exchange again.

### Exchange goes offline for a certain amount of time to do maintenance work
The popular cryptocoin exchange kraken went offline in January 2018 for more than 38 hours due to maintenance work. During this time customers were unable to access their funds. Any losses in value due to price fluctuations could therefore not be prevented by trading.
However, anyone in possession of their private key can choose another exchange in such a case and buy or sell there. The safest exchange must therefore ensure that the customer is in possession of his private key at all times.

### The government seizes funds on an exchange account
The fact that the government has no problems confiscating funds was made clear to everyone with the arrest of the well-known (and controversial) Internet entrepreneur Kim Dotcom. He was arrested in 2011 on charges of commercial copyright infringement and his assets were frozen. The fact that his arrest may even have been unlawful does little to help him. [[3]](https://www.radionz.co.nz/news/national/337996/spy-agency-s-dotcom-surveillance-illegal-court-rules)
Such things should also be prevented by the safest exchange. With an instant exchange that doesn't have any accounts, this can't happen. The client is ALWAYS in possession of his assets.

## All right, but which exchange is the safest?
After careful analysis of all the above examples, it is surely clear to everyone that the safest exchange can only be an instant exchange. These combine the advantages of fast trades with the fact that you always have access to your private key.
However, there is not only one instant exchange. There are three big players on the market.

1. [flyp.me](https://flyp.me)
2. [shapeshift.io](shapeshift.io)
3. [changelly](https://changelly.com)

However, since changelly needs an account, it is already out of the competition for the safest exchange.
Now we just have to decide if flyp.me or shapeshift can take the title the safest exchange home! The two exchanges are very similar and offer similar coins. Flyp.me offers for many coins slightly better exchange conditions as you can see on https://exchangecompare.io
However, a small but important point distinguishes flyp.me from its opponent: flyp.me does not use tracking. As we all know, privacy and data protection are closely related to security. Therefore it is clear to me that the safest exchange must not use tracking via google analytics or other services. Otherwise it cannot be the safest exchange!

That's why the [safest exchange](https://flyp.me) for me is flyp.me!