How does Bitspark get its rate?
When using Bitspark's products you may see an exchange rate and wonder what is an exchange rate and where the rate comes from if not from traditional FX markets.
What is an exchange rate?
An exchange rate is the value of one currency (currency or cryptocurrency) when converted for another currency. Or said in another way, how much your currency is worth when converted for something else. We can tell a lot from an exchange rate like how valuable your currency is compared to another and how much you get for exchanging.
This principle remains the same whether you are exchanging currencies or cryptocurrencies or even exchanging between currencies or cryptocurrencies. This is what Bitspark's products and services specialise in - allowing customers to exchanging currencies (through stablecoins) and cryptocurrencies.
Where does the rate come from?
The Bitspark exchange rate comes from Bitspark's decentralised cryptocurrency exchange - Sparkdex. When you exchange through the web platform or mobile app the rate you are given is direct from the markets on Sparkdex. For example, if you were to exchange between Sparkdex.HKD (Hong Kong stablecoin) to Bitcoin, the rate you are given is live from the Sparkdex Sparkdex.HKD/BTC market. Much like traditional FX markets, the rate given is what the market determines the value of your currency is to what you are exchanging. This is the same for any market pair whether stablecoin to stablecoin, between cryptocurrencies or stablecoins to cryptocurrency.
Depending on your level of understanding and expertise of trading, customers can either use Bitspark's mobile app or web platform to interface with Sparkdex or they can trade directly on the Sparkdex markets. Bitspark suggests that those new to the cryptocurrency space should use the user friendly interface as Sparkdex is a heavy duty, state of the art exchange platform for seasoned trading professionals.
Buy and sell cryptocurrency and stablecoins here.
How can I get a better rate?
Exchange rates are dependant upon market prices for cryptocurrency on Sparkdex. The rate you see takes into account the market depth of the order book on the exchange if there are less trades the rates are worse and if there are more trades the rates are better. Market depth is the market's ability to sustain relatively large market orders without impacting the price of the asset. This means if you trade smaller transaction sizes, the higher in the order book your transaction will be executed and therefore the better the exchange rate.