What is a floating exchange rate?
Selecting an exchanger on BestChange, you can notice that some of them have a “This exchanger does not fix the exchange rate in the order” mark. Let’s see what this means for the user.
This mark can be set in two cases:
🔒 If the trading pair is very volatile. In this case, the exchanger sets a short lifetime of the order or a maximal allowable percentage of deviation to insure against sharp fluctuations in the exchange rate. When going beyond these limits, the rate will be recalculated up or down.
🔒 If an order can take a long time — for instance, for cases with cash or during a high load of the cryptocurrency blockchain. In this case, the exchanger recalculates the amount at the rate that took place at the moment of closing the deal.
Some exchangers set a specific time limit (for example, 10 minutes), during which the rate will be fixed. If the order hasn’t been paid for during this time, then the fixing of the rate is canceled. Also, sometimes, the rate gets reviewed only after a considerable change in the market rate of the currency. Say, by 5%.
A decent exchanger must specify the relevant information at the stage of creating an order — conditions for the rate change, the number of the network confirmations for cryptocurrencies, the conditions for rate formation (for example, at the indices of this or that exchange), maximal amount of recalculation of the final amount, etc.