How to choose a crypto exchange

By the Blockhorizon Editorial Team · Updated 2 October 2026 · How we check facts

What should you check before you open an account?

A crypto exchange (regulators often say “platform”) is a company that lets you buy, sell and often store crypto. Choosing one is less about features and more about what happens to your money when something goes wrong. The checks below come from guidance published by financial regulators: the UK Financial Conduct Authority (FCA), the US Securities and Exchange Commission (SEC), the EU’s European Securities and Markets Authority (ESMA) and others. We name no platforms on this page. We have not rated any yet, and we will publish how we will rate them before we do.

The short version:

1. Is it registered or authorised where you live? Check the official register yourself.
2. What does that registration actually cover?
3. Who holds the private keys to your crypto?
4. What happens if the platform halts withdrawals or goes bankrupt?
5. What will you pay in total, including the spread?
6. If you are in the UK, does its marketing follow FCA rules?
7. Did you hear about it from an influencer, and were they paid?

Is the platform registered or authorised where you live?

Start with the regulator’s own register, never a link or badge supplied by the platform. Type the register’s address into your browser yourself; the FCA tells consumers not to click links in emails to reach its Firm Checker. Then compare the exact legal name, reference number, website, phone number and email with what the register shows. Scammers copy the reference numbers of real firms, so a matching number alone proves little. See our guide to checking if a crypto firm is authorised.

Where to look depends on where you live:

• UK: the FCA is the anti-money-laundering supervisor of UK cryptoasset businesses. Firms offering exchange or custodian wallet services in the UK must register with it before starting. Check the FCA Firm Checker and the FCA Warning List. A firm that is not on the Warning List may still be unauthorised; the FCA says unauthorised firms often change their names.
• EU: under the Markets in Crypto-Assets Regulation (MiCA), ESMA publishes a register that lists authorised crypto-asset service providers and also non-compliant entities. The transitional period for firms without MiCA authorisation ended on 1 July 2026. ESMA invites clients “to verify whether their provider is authorised under MiCA in the ESMA Register”.
• US: the Financial Crimes Enforcement Network (FinCEN), part of the US Treasury, treats a business that buys or sells convertible virtual currency as a money transmitter, unless an exemption applies. FinCEN publishes a list of registered money services businesses.

If you cannot find the platform on the register for your country, do not open an account.

What does being on a register not tell you?

A register entry is a minimum, not a seal of approval. Read what each regulator says about its own list:

• The FCA, in its guidance for crypto firms: “Being registered with the FCA as a cryptoasset business does not mean your customers benefit from the protections of the Financial Ombudsman Service or the Financial Services Compensation Scheme (FSCS).” It adds that registration “is not a recommendation or endorsement of your business.”
• FinCEN: “The inclusion of a business on the MSB Registration Web site is not a recommendation, certification of legitimacy, or endorsement of that business by any government agency.” It also says “FinCEN does not verify information submitted by the MSB.”
• The SEC warned in March 2023: “None of the major crypto asset entities is registered with the SEC as a broker-dealer, exchange, or investment adviser”.

So the register answers “is this firm allowed to operate here, and is it who it says it is?” It does not answer “is my money protected?” The next checks do that.

Who holds the private keys to your crypto?

Whoever holds the private key controls the crypto. The SEC defines custody as “how and where you store and access your crypto assets.” When you leave crypto on an exchange, the exchange usually holds the keys. That is called third-party custody.

The SEC’s December 2025 bulletin is blunt: “If the third-party custodian is hacked, shuts down, or goes bankrupt, you may lose access to your crypto assets.” It names two practices to ask about:

• Rehypothecation: some custodians use deposited crypto as collateral for their own purposes, such as lending.
• Commingling: some custodians pool customers’ crypto instead of holding it separately for each customer.

Look in the platform’s terms of service for answers to three questions. Are customer assets held separately from the company’s own? Can the platform lend or reuse what you deposit? Can you withdraw to a wallet you control? Our lesson on wallets and private keys explains the trade-offs of holding keys yourself.

What happens if the platform stops withdrawals or goes bankrupt?

This has already happened. The SEC noted in 2023 that some crypto firms “have faced severe financial difficulties, sometimes resulting in suspending customers’ ability to withdraw their assets”. Others “have entered bankruptcy proceedings, and it is unclear how much of their holdings (if any) customers might be able to recover.” The same alert warns that people who deposit crypto with such a firm “might cease to have legal ownership of those assets”.

Do not assume a safety net exists:

• UK: the FCA says crypto “is largely unregulated in the UK, so it is highly unlikely you will be covered by the Financial Services Compensation Scheme”.
• EU: the joint warning of the EU supervisory authorities (2025) says that even under MiCA, “you will not benefit from compensation schemes”. ESMA also says clients of unauthorised providers “do not benefit from MiCA safeguards, including protections for client assets.”
• US: the SEC says the protections that apply to brokerage accounts do not carry over: “There are no such protections for accounts that you place with crypto asset entities”.

A practical rule follows: only keep on a platform what you could afford to lose if it froze tomorrow.

What will you really pay in fees and spread?

The headline trading fee is only part of the cost. Every price has two sides: the bid (what a buyer will pay) and the ask (what a seller will accept). The gap between them is the spread. The SEC notes that the ask “will almost always be higher than the bid price”. So if you buy and immediately sell, you usually get back less than you paid, even before fees.

Before you deposit, write down every cost the platform lists:

• the spread on the coin you want, at the size you plan to trade;
• trading fees or commissions on each buy and sell;
• fees to deposit money and to withdraw money;
• fees to withdraw crypto to your own wallet.

“Zero commission” does not mean free, because you still pay the spread. Put your numbers into our crypto profit calculator to see how fees change the price a coin must reach before you break even.

Does the platform follow the UK’s crypto marketing rules?

If you live in the UK, how a platform markets itself is a useful test. Since 8 October 2023, crypto promotions aimed at UK consumers must follow FCA rules. Among them:

• A prescribed risk warning, which begins: “Don’t invest unless you’re prepared to lose all the money you invest.”
• No bonuses for joining, and no refer-a-friend bonuses.
• A 24-hour cooling-off period for first-time investors with that firm.
• Checks that you have the appropriate knowledge and experience before you invest.

The FCA’s consumer guidance turns this into a simple check: “you should see prominent warnings about the risk of losing your money, and you shouldn’t be offered any free gifts to join or refer a friend bonuses.” If the warnings are missing and you are offered an incentive, the FCA says the company “isn’t following our rules, and could be illegal, or even a scam.”

Outside the UK the rules differ, but a sign-up bonus is still a sales tactic, not a sign of safety.

Should you trust an influencer’s recommendation?

Treat it as an advert until proven otherwise. The EU supervisory authorities warn of promotion “especially on social media where influencers can be incentivised to advertise certain crypto-assets.” In the UK, the FCA’s 2024 guidance on social media says that “Unauthorised persons, such as social media influencers, who promote a regulated financial product or service without approval of an appropriate FCA-authorised person may be committing a criminal offence.”

Ask three questions. Is the post labelled as an advert, and does it show the risk warnings your country requires? Is the influencer pointing you to a platform you can find on the official register? And are they pushing you to act fast? Pressure and urgency are classic scam red flags.

What does the full checklist look like?

What are the risks even if you choose carefully?

A careful choice lowers platform risk. It does not remove market risk. The FCA says that if you invest in crypto “you should be prepared to lose all your money, for any one of a variety of reasons, including sudden market moves, the failure of a firm, poor segregation of client funds or cyberattacks.” Registers can be out of date, terms of service can change, and a platform that is sound today can fail later. Re-check the register from time to time, and read our overview of crypto risks and our risk disclosure.