Crypto exchange vs crypto broker
The difference in one table
| Crypto exchanges | Crypto CFD brokers | |
|---|---|---|
| What you end up holding | The coin itself | A contract on the price |
| Can you withdraw it on-chain? | Yes | No — ever |
| Typical cost model | One-off % per trade | Spread + daily financing |
| Cost of holding a year | Nothing after the buy | Financing accrues daily |
| Can you go short? | Only with margin products | Yes, natively |
| Retail leverage (UK/EU) | Spot: none | Capped at 2:1 |
| Typical regulation | AML registration | Full investment licence |
| If the firm collapses | Usually an unsecured creditor | Segregated client money; some schemes cover |
| Suits | Owning and holding | Short-term directional trading |
How to tell which one you are looking at
- Look for a withdrawal address. If the platform cannot give you an on-chain address for the asset, it is a derivative, whatever the marketing says.
- Look for overnight financing in the fee schedule. Spot assets do not accrue a daily charge. Contracts do.
- Look at the licence scope. An investment licence with a firm reference number points to a broker. A VASP or MSB registration points to an exchange.
- Look for a loss-percentage disclosure. Regulated CFD providers are required to publish the share of retail accounts that lose money.
Where each of our venues sits
Frequently asked questions
Is a crypto broker the same as a crypto exchange?
No. An exchange transfers ownership of the asset to you and lets you withdraw it on-chain. A broker offering crypto CFDs sells you a contract whose value tracks the price. You never receive a coin and cannot move one to a wallet.
Which one is safer?
They fail differently. Brokers are usually licensed investment firms with conduct rules, segregated client money and negative-balance protection — but the product is leveraged and most retail accounts lose money. Exchanges give you a real asset you can self-custody, but most hold only an AML registration and your balance is unprotected if the firm collapses.
Which is cheaper?
For buying and holding, an exchange is almost always cheaper — you pay a one-off percentage and then nothing. CFDs charge a spread plus daily overnight financing, so cost grows the longer you hold.
We earn a commission on some links. It never changes the ranking — our method is published and the data is sourced.
Crypto is volatile and largely unregulated. CFDs are leveraged and most retail accounts lose money. Never risk money you cannot afford to lose.
Information only. This is not investment advice.