I’ve been using an altcoin exchange called FreiExchange for a while in order to trade some obscure altcoins that can’t be found elsewhere. This is my review of them:
Founded in 2016 by a Norwegian dude, the website looks like something straight out of the late 90s but is surprisingly functional and responsive – using modern technologies like Flexbox. The color scheme is a pleasant dark grey with hints of red, green, and blue and is a welcome change from the usual corporate look of other exchanges as well as being easy on the eyes.
The name of the exchange comes from an old cryptocurrency called Freicoin. Released in 2012, Freicoin was unique among cryptocurrencies in that it discouraged hoarding and encouraged spending by causing a portion of one’s coins to slowly disappear over time. It was an interesting economic experiment that failed to attract significant investment for obvious reasons and is relatively unknown today. FreiExchange is the main exchange to buy and trade Freicoin, although the exchange features over 100 other pairs including popular coins like Litecoin, Dogecoin, and Monero.
Registering an account is a simple process that takes less than a minute. There are no KYC requirements which given that there are no fiat currencies being traded, is really the way things should be. Additionally, FreiExchange supports and encourages its users to enable two-factor authentication (2FA) to add an extra layer of security to their accounts. Both deposits and withdrawals were generally fast and easy, although sometimes they can take several hours due to the need for additional network verification:
Given that many of the coins on FreiExchange aren’t super popular, lack of liquidity and volume can be a real issue however. 24-hour trading volumes for most pairs tend to be quite low (<0.05 BTC) and spreads between buy and sell orders can also be a bit high at times.
FreiExchange also doesn’t support trading in units smaller than one satoshi. This can be an issue for coins with high supplies or low prices. FreiXLite is a sister exchange of FreiExchange that uses Litecoin instead of Bitcoin which helps mitigate the sub-satoshi issue but a quick look at their markets shows that their trading volume is very, very low.
A unique aspect of FreiExchange is its lack of trading or deposit fees. Instead, the exchange makes money solely through withdrawal fees. Bitcoin withdrawals also come with a 0.0006 BTC processing fee (about $35) and the minimum withdrawal limit of 0.0025 BTC is quite high (almost $150) so I wouldn’t recommend withdrawing Bitcoin too often unless the high costs don’t bother you. Fortunately, withdrawal fees and limits for other coins are far more reasonable.
Another unique aspect of FreiExchange is the option to invest in FreiXShares (FXS) as a way of making some passive income on the side. According to their official description, these aren’t securities and don’t represent ownership of the exchange. Instead, they entitle you to a cut of the profits of the exchange taken from users’ fees. Just out of fun, I decided to purchase 0.1 FXS (worth about $8.60) and sure enough, about $0.10 to $0.15 worth of dust spread across Bitcoin, Dogecoin, and Namecoin as well as a handful of coins with names like MotaCoin and Riecoin started appearing in my account every Sunday. FreiXShares can be traded on FreiExchange just like any altcoin but they aren’t a cryptocurrency and don’t have their own blockchain. Therefore, if FreiExchange goes kaput then any FXS tokens would cease to exist.
All in all, I’m pleased with FreiExchange. It’s not perfect but it does fulfill a unique role in the cryptocurrency space. According to their website, there are no listing fees for a coin to be added to the exchange and many of the coins featured would otherwise have no other place to trade, making it a much-needed sanctuary for older and less visible coins.