Key points
- Price exposure is not the same as owning the underlying asset.
- Broker and exchange cost models can be structurally different.
- Leverage changes risk and liquidation mechanics.
- Compare products only within the correct class.
Begin with what the position actually represents
A spot exchange account can credit a balance in the traded crypto asset, subject to the venue's custody and withdrawal terms. A broker may instead offer a derivative, contract or other instrument that references a crypto price without giving you the underlying asset. The screen can look similar while the legal and operational product is very different.
Read the instrument name, contract specification and client agreement. If a product settles in cash or is a derivative, do not describe it as equivalent to buying and withdrawing the underlying asset.
Compare execution, leverage and total cost
Brokers can price through spreads, commissions, financing or overnight charges. Exchanges may use maker/taker fees, spreads, conversion fees and derivative funding. The correct comparison depends on holding period, order type and whether leverage is involved.
Leverage magnifies both gains and losses and can create liquidation risk. A small move in the underlying market can have a much larger effect on a margined position. Check margin rules and liquidation mechanics before focusing on the advertised maximum leverage.
Keep legal entity and market rules visible
Broker permissions, exchange registrations and product restrictions vary by jurisdiction. A brand can offer different products through different entities. Research should identify the entity and avoid turning a generic regulatory label into a claim about every service the brand offers.
For comparisons, keep spot exchanges and leveraged broker products in separate lanes unless the user deliberately selects a cross-class educational comparison.
Primary reading
These official sources provide background for the risk and custody concepts used in this guide. Product-specific facts should still be checked against the relevant operator and jurisdiction.