Crypto Safety – Navigating Crypto EXCHANGES
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Crypto Safety – Navigating Crypto EXCHANGES

Crypto safety is a big concern in these uncertain times and we all know the stories of hacked crypto exchanges and robbed wallets. I have another post coming later on safely using Crypto Wallets. This post will dive into both my experience with exchanges since 2016 and also some psychic predictions on how to navigate using and trading on exchanges safely.

MY FAVORITE OPTION – BROKERAGE – I prefer to use Caleb and Brown for my crypto purchases. You are tax protected if you send funds from your LLC bank account and open your account with them in the name of your LLC (it has to match exactly). I work with Jake but all the brokers are great and if you tell them I sent you they give you 3.5% fees instead of 5% fees.

Sometimes it is hard to find a place to buy certain coins and C&B can get you anything. They are in Australia and you can set your account up under your LLC if you have one. I have partnered with John Singleton to help bring you what I believe to be the best legal and tax protection in the industry.

EXCHANGES – You can set up your own trades and move your own funds around on an Exchange. If you don’t have an LLC you will have to do KYC with them and be tracked. All exchanges have to follow these laws and they have to report to the Govt. The LLC offers you protection against these invasive government practices, and also creates all kinds of tax havens and strategies.

EXCHANGES WILL HAVE PROBLEMS – There will come a point where some exchanges just shut down and take all their customers money. There will be banking problems that cause exchanges to shut down. Just this month – June 2020 the biggest exchange in the US – COINBASE – had shut down periods. THIS CAN AND WILL HAPPEN TO ANY EXCHANGE AT ANY TIME. I have been warning about this in the Monthly Timing Report for PRO and VIP members for months, and it’s only going to get worse over time. So please be wary of exchanges.

Speaking of COINBASE – although they may be the easiest US exchange to use, just know they are working for the dark side. They are actively working with the FED and the CIA for the specific purpose of illegally tracking thier customers. But even so, you can still use the STABLE COIN TRICK to buy through them. This trick is listed a bit further down.

You can set up accounts in the name of your LLC at any exchange. The one I like the best is CoinEx – they are in Japan and they have a lot of coins that you can trade, they don’t have everything, but a lot of the good ones are there.

Gemini is ok. Really the best thing about Gemini is that you can buy the Gemini coin which is a USD pegged stable coin called GUSD and then send those to your own wallet and then buy the cryptos you want on your own.

This is what I call THE STABLE COIN TRICK (It also works on Coinbase). Why would you want to do this? Because if you do not have an LLC this is a way to get money into the crypto world without creating a tax event. Every time you buy a crypto on an exchange in your own name – you just created a tax event for yourself. But if you buy a stable coin – any stable coin – then you haven’t.

STABLE COINS: – Good stable coins are USDC, TUSD, PAX and DAI. I do also need to mention Tether – USDT – I hate them because they are the coin that is used to manipulate the prices in this market. They are a proven criminal organization. However, they are on pretty much every exchange so you can use them more easily than nearly any other to trade in and out of your cryptos. It’s really up to you. But at some point in the future I do see them having problems because they will eventually come into legal trouble. This isn’t going to happen right away though. So this is the trade off for the convenience of using them – high risk.

And when you trade stable coins on a coinswap sevice (like Coinswitch.io) then you just did it without anyone watching you – so there is no tax event. You can also trade stable coins to crypto in the Exodus desktop wallet. But I would be careful about leaving the coins in Exodus as they have been hacked in the past.

Bittrex is not bad, but recently have become a lot more vigilant about tracking your identity. Bitmex is maybe a little better but in Mexico so I don’t know if they work with US customers.

Cex.io might be allright, I’ve used them with good success.

Special mention for MERCATOX – I have never used this exchange. They offer a HUGE selection of coins to trade. They probably have a lot of hoops to jump through, but I am getting that there will be a pretty big issue with them being hacked and going down for a significant period of time in the next 6-12 months, so as good as they look, I would stay away.

AVOID AT ALL COST – Whatever you do stay away from Poloniex and HITBTC they are both run by scam artists and HitBTC will actively try to steal your money, they are bad, bad, bad.

BINANCE – Many US customers trade on Binance because they have so many coins. They specifically warn US investors that they don’t want to work with you. So you’re really running the risk of them taking all your money at any time – and I do believe there will come a time when they will do exactly that – so I would stay away. 

And that’s about all I have at the moment on the the normal exchanges. However there is still another good exchange option – the DEX.

DECENTRALIZED EXCHANGES (DEX) – In my opinion, if you are going to make your own trades then this is THE best way to do it. It’s a lot harder though and takes a lot more work. Here is a good top 10 article on the supposed best DEX out there (I have not used most of these): https://hackernoon.com/top-10-decentralized-crypto-exchanges-for-a-successful-proofofkeys-in-2019-478dc38cff7a Below are the only ones I have any personal experience with, but I will say that I feel good about WAVES and it will continue to gain strength and grow over time. BANCOR is also going to be good long term.

IDEX – I had some conversation with Phil Ween when they were in the ICO phase and I liked both him and his brother and they have a good business plan. And, of course, I’ve gotta love that their platform token is called Aura but as for an exchange, they are just ok. And this is mainly because about a year ago they started requiring KYC – so as far as I’m concerned – what’s the point?

FORKDELTA – this is probably the best known (no KYC required) exchange in existence. You can get just about any ERC-20 (Etherium Network) coin at ForkDelta (formerly EtherDelta), but it is hard to navigate and there is a learning curve involved in using them, so be prepared to spend an hour figuring out how to do it.

You will need to have either a MYETHERWALLET wallet or a MetaMask Browser Wallet with ETH in it in order to make transactions and trades on ForkDelta – this is how you buy your ERC-20 coins and pay the fees.

PRICE CALCULATION – Just be aware that you have now entered a new world of price measurement and you are no longer buying coins as measured in Dollars but rather as measure in ETH, and it can get very confusing in the midst of big price movements in the market as BTC or ETH is rising or the coin you are trying to buy is rising or falling in USD.

It might be worth getting a MetaMask browser wallet just so you can navigate ForkDelta more easily. You can get a couple of my favorite LONG TERM coins: VERI and PPT there, so it’s good to be able to figure it out. You can find hundreds of YouTube tutorials on this.

The upshot here is that it’s safest to trade on a DEX or a COINSWAP service. See this post about COINSWAP SERVICES. If you MUST trade on an exchange be very careful and wary and don’t leave any significant amount of money on there for very long. Just go in, make your trades over a couple of days on the coin that is moving, and then take your money off.

Or you could just place orders with Caleb & Brown. I’ve done both. But there is a $2,000 minimum with C&B so for small amounts these other options might be better.

This Post Has 25 Comments

  1. Kitty007

    Thanks for the info, I didn’t know exodus was hacked wow…also is Atomic safer?

    1. Aura

      No Atomic is not very safe unless you keep it on a computer that is always offline. I had a member here with that strategy – that would work.

  2. P.Black

    You mentioned Binance but how about BINANCE U.S.? Is the U.S. version ok to use?

    1. Aura

      Binance won’t work with US customers anymore. I don’t know what’s going to happen to Binance US but you can’t trade there.

  3. Vimal Shah

    Hi Aura,
    Do you have any information about the EUROPEAN exchange BITPANDA based in Austria?

    1. Aura

      I think they are ok as far as exchanges are concerned but all exchanges will become dangerous to leave money in by late July or August. So just make a trade and then take your money off asap. I prefer to use Caleb & Brown – they give all my people discounted 3.5% fees (instead of 5%) and they just get it done for you. This actually ends up being cheaper than most of the exchanges because often the exchange takes arbitrage fees as well that you don’t see.

      1. Third Eye Focus

        Well, that makes sense. Especially Binance is famous for its ridiculous withdrawal fees if you want to send coins elsewhere.

  4. TOMjim

    Hi Aura, what NEGATIVE EFFECTS can arise, after a persons trades and investments have been illegally tracked, because they use COINBASE?
    Aren’t there any positive reasons why COINBASE would want to track customers – such as taxes, theft prevention, and being able to track stolen coins in the unfortunate event of a hacking event?

    1. Aura

      Well, regulation of illegal activity is a slippery slope and leads to us losing our privacy. The best way to track and get back your own stolen coins is through a blockchaing lawfirm who specializes in doing that. I can’t remember their name offhand but they are great. The blockchain itself makes this possible – there is no need for an exchange to do it unless they want to control our lives. The issue with Coinbase is that they are working with the Cabal and released a statement that they are also building software for the FBI. There is no way this can lead to anything good for the normal person. Just stay away from them and delete you account asap.

  5. Julie Gum

    what about coins on Atomic wallet on cold storage (old pc not plugged into internet). I have my seed numbers.
    I trust your answer completely.

    1. Aura

      Julie –
      I don’t love Atomic in general, but you have them stored safely and will be fine.

  6. Ajaycsharp

    Aura, do you only buy or do sell also with Caleb & Brown ?

      1. Third Eye Focus

        Even a 3.5% cut (instead of 5%) on any transaction at Caleb & Brown is pretty big. I think it only makes sense to use them in order to try catching the bottom of a huge sell-off, especially if exchanges and banks will get problems.

        1. Aura

          Not really, most exchanges wind up taking more because the put padding on the price of the coin – especially exchanges like CoinBase. When crypto gets really low, you will have a very hard time getting your orders to go through. Even now there are problems getting some things.

  7. Daniel Dydyk Costello

    Bittrex does not allow US customers to use their exchange. I had been using them for 2 years before, last week, they made me complete KYC after which they informed me that I have 14 days to withdraw my assets from their exchange because my primary residence is in the US.. FYI

    1. Daniel Dydyk Costello

      Correction! This was HitBTC that does not allow for US based customers.. sorry!

      1. Aura

        They used to, but you don’t want to use them anyway because they are stealing people’s coins.

    2. Aura

      Yes, stay away because they will steal your coins.

  8. eli

    Recently I discovered 3c.exchange and really like it, it is an offshoot of 3commas
    It connects with Binance exchange, and you only need an email and password (no kyc required).
    So this is probably a good work around for US people
    They allow ‘smart trading’ so you can set stop loss, take profit’s, it’s very easy
    They allow more than one account, just use a different email for each account (they told me I could do this)
    Withdrawal limit is 2 btc /24 hours for each account (after that you need kyc)

  9. Dr. Andy

    Excellent info and guidance on these exchanges front’ AURA.
    I have been using FREEWALLET.org (coinswap service) since 2013 and It has been really good, fast ,reliable and recent years they have very good improvised MOBILE APP too with multi-factor authy security feature. They have some top coins as per coinmarketcap web which are FREE on FEEs to exchange almost instantly for TRADING purpose. I use the same almost many times each day for my crypto endeavors among all other major exchanges as Aura suggested.

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