What is Bittrex?

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robertstevens

Robert has reported for a variety of international publications including the Associated Press, The Guardian, Vice, and Decrypt. Current areas of interest include the political economy of technology, cryptocurrencies, and privacy. Robert has a Bachelor of Science from UCL, and a Master's degree from the University of Oxford's Internet Institute.

Bittrex is a cryptocurrency exchange on which you can buy, sell and hold cryptocurrencies like Bitcoin and Ethereum. It lists 399 coins, the 11th highest number of coins of all major exchanges, on 893 markets, the 9th highest number. It’s a fairly popular exchange and traded $124 million on its spot exchange on July 21.

The exchange, which operates under the name Bittrex Global (a common term for crypto exchanges, which often have no official headquarters and hop between the countries that haven’t banned them), is registered in Bermuda and Liechtenstein.

Bittrex was created in 2014 by three former cybersecurity engineers at Amazon: Bill Shirara, Richie Lai and Rami Kawach. It’s now run by CEO Stephen Stonberg, who spent the past 25 years in finance in New York and London. The exchange promises all the offerings as all of the other big crypto exchanges: security, custom-built trading engines and fast deposits and withdrawals. Here’s what it’s all about.

How to buy Bitcoin on Bittrex

Suppose you want to buy Bitcoin on Bittrex. The first thing you need to do is decide how you’re going to buy the “digital gold.” You have plenty of options, and each might incur different fees.

You can buy it through the Bittrex website or on Bittrex’s mobile app. To trade on either, you’ll have to submit identification information to help Bittrex engage in the “fight against illicit financial activity” (to prove you’re not laundering money or scamming people).

Once that’s all done, it’s time to buy your Bitcoin, which you’ll have to buy with another cryptocurrency, like Dogecoin or Ethereum, or with a fiat currency, like the U.S. or Canadian dollar.

Moving cryptocurrencies onto Bittrex will incur the cost charged by the blockchain network; Bittrex doesn’t charge for deposits, but you’ll have to pay the network fee, payable to, for instance, Dogecoin or Ethereum miners. It’s the same deal with bank transfers. Bittrex doesn’t charge users for USD deposits but your bank might levy a fee for wire transfers.

Say you’ve loaded up your Bittrex account with 100 US dollars. What next? You’ll have to go to Bittrex’s exchange page, and from there place a trade on the spot market. Bittrex’s Bitcoin/U.S. dollar pairing is its largest market so you shouldn’t have any problem placing your trade, but you’ll have to pay a trading fee.

In this case you’ll be liable for a “taker” fee because you’re “taking” someone else’s offer off of the market’s orderbook. Taker fees vary according to your monthly trading volume. If you’ve traded under $5,000 a month, it’s 0.75%. Between $5k and $10k, it’s 0.5%. These fees stretch to 0.05% if you’ve traded more than $100 million in the past month.

“Taker” fees contrast with “maker fees,” which are paid for adding trades to the orderbook. At the higher end of trading volume, maker fees are lower than taker fees to encourage traders to add offers to the orderbook rather than simply take them away. You can benefit from the maker fee if you trade through a “limit” order, which allows you to specify the price at which you’d like to buy your Bitcoin. On Bittrex, maker fees only undercut taker fees if you’re trading more than $25,000 a month.

Bitrrex’s fees are higher than other exchanges. Binance, the largest crypto exchange in the world, charges spot trading fees of 0.1% for both makers and takers, and these fees can be reduced by holding BNB, Binance’s own cryptocurrency, or by trading more cryptocurrency in a given month.

Another option on Bittrex itself is the “instant buy” feature, which lets you buy Bitcoin from Bittrex itself in just a few clicks. Note that you pay a premium for this feature, and spending a few minutes getting familiar with how the exchange works can save you money in the long run. For $100 of Bitcoin, Bittrex returns $98.52, thus charging a 1.48% fee. In other words, you’ll pay double the fees you’d pay if you just bought Bitcoin on Bittrex’s exchange through its matching engine.

Let’s assume you’ve now bought your Bitcoin, sacrificing whatever fees you must to Bittrex for the privilege of using their services. And let’s assume that you want to move that crypto off Bittrex. You might do this for a number of reasons. Perhaps you’re concerned that Bittrex could collapse and withhold your money; if you keep it in your own wallet, you’re in control of your funds and nobody can take your Bitcoin away unless they have the keys. Perhaps you want to buy something with that Bitcoin. Or perhaps you want to plug that Bitcoin into one of several dozen lending protocols or companies, like BlockFi or (if you first convert it to an Ethereum-compatible version of Bitcoin, like Wrapped Bitcoin) Compound or Aave.

Whatever your reason, Bittrex is going to charge you a fee of 0.0003, or about $10, to withdraw your Bitcoin. That’s regardless of the size of your withdrawal. Plus, you’ll have to pay a Bitcoin network fee, which could range from a couple dollars to $40, depending on how busy the network is at that moment in time. Not cheap!

One way of cutting these fees is to just… buy Bitcoin elsewhere for less and skip Bittrex altogether. Another is to first convert your Bittrex-based Bitcoin to a cryptocurrency with a cheaper withdrawal fee, like Bitcoin Cash (its withdrawal fee is $0.43) or Bitcoin SV ($0.12), then send it to your destination, like another exchange, and rebuy that Bitcoin before the price changes too much. It’s not perfect, but there are ways to get around these fees.

It’s the same process for all other cryptocurrencies. And on Bittrex, there are hundreds of them, each with their own markets, communities, and purposes. Remember that this is crypto, and thus incredibly volatile, and you shouldn’t invest a penny more than you can stand to lose. Consider watching the markets for a few days to get a feel for things, too, keeping in mind that cryptocurrency markets can collapse in an instant, leaving their investors high and dry.

Can you use Bittrex in Canada?

Yes, Bittrex operates in Canada.

The company also operates in most US states apart from New York, where few crypto exchanges are licensed to operate. However, it operates under “Bittrex”, as opposed to “Bittrex Global,” and offers fewer coins.

Bittrex is banned altogether in a few countries, including the Ukraine, Belarus, Burundi, Mali, Myanmar, Nicaragua, and Panama.

Tokenized stocks

The exchange was one of the first to offer tokenized stocks. These are cryptocurrencies that represent a stock on the US stock market, and are pegged to the value of said stocks. Unlike real stocks, you can buy fractions of tokenized stocks, letting you buy, for instance, half a Tesla stock.

And unlike real stocks, Bittrex’s tokenized stock markets operate 24/7. “Note, however, that the liquidity of the underlying assets may vary over the course of the day and week,” warns Bittrex.

It’s a limited offering—don’t expect to trade the entirety of the S&P 500 on Bittrex—but certainly an attractive prospect to investors who find it difficult to access global markets. Unlike its competitors, Bittrex’s tokenized stock entitles holders to dividends. However, only DigitalAssets.AG, the company actually issuing stocks, can exercise voting rights.

Bittrex’s tokenized stocks are available to customers outside of Europe and the UK, and the US, as well as any “banned jurisdictions.” Note that Binance, one of Bittrex’s (much more powerful) rivals, suddenly stopped offering tokenized shorts in July, 2021 after a bunch of regulators from the UK, Hong Kong and others said that its tokenized stocks probably constituted securities fraud and that Binance should stop as soon as possible.

How does Bittrex compare to other exchanges?

There are dozens of cryptocurrency exchanges. Most look pretty similar and offer the same services, albeit with different fee structures. Some offer more advanced services to help earn money on exchanges, like staking and lending. Bittrex keeps its offering traditional and has stuck to spot trading. Within that, there’s instant buys and sells, stock trading, and more complicated tokens like leveraged tokens, which are tokens that futures contracts and margin trading.

Bittrex lacks some of the more advanced trading options, like actual derivatives trading, NFTs (crypto art) or staking and lending. Its fees are higher than other exchanges, like Binance or FTX, which offer the same services with higher liquidity (i.e. less chance of an order going unfulfilled). But few exchanges rival Bittrex Global (the non-US version of the exchange) in terms of the number of coins and markets offered.

Last Updated August 2, 2021

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