Exchange Grading Methodology

Overview

BridgePort Analytics provides independent, data-driven rankings of cryptocurrency exchanges based on real execution quality metrics. Our methodology focuses on what matters most to traders: how much it actually costs to execute trades at various sizes.

Unlike rankings based on self-reported volume or trust scores, our grades are derived directly from order book data—measuring spreads, slippage, and liquidity depth across multiple trade sizes and time periods.

Execution Quality Metrics

We evaluate exchanges across five core dimensions:

1. Spread

The bid-ask spread measures the cost of immediately crossing the spread to execute a trade. We calculate spreads at multiple depth levels (1K, 5K, 10K, 50K, 100K, 500K, and 1M USD equivalent). Tighter spreads indicate more competitive pricing.

2. Slippage

Slippage measures the price impact when executing larger orders. We calculate expected slippage by simulating market orders at various sizes against the live order book. This metric is especially important for institutional traders.

3. Spread Consistency

Beyond average spreads, we measure how stable spreads are over time. High consistency indicates reliable execution conditions, while high variability may signal liquidity concerns.

4. Bid/Ask Balance

We analyze the ratio of bid-side to ask-side liquidity and its stability. Balanced order books suggest healthy two-sided markets.

5. Fragmentation

Fragmentation measures how liquidity is distributed across price levels. Lower fragmentation indicates concentrated liquidity near the mid-price, enabling better execution.

Grading System

Our grading system uses relative performance ranking to assign letter grades from A+ to C-.

Retail vs. Institutional Grades

We provide separate grades because execution quality varies by trade size:

• Retail (1K-10K USD): Evaluates execution quality for smaller trades typical of individual traders.
• Institutional (50K-1M USD): Evaluates execution quality for larger trades that consume multiple price levels.

Data Sources

We aggregate market data from leading cryptocurrency data providers. Our infrastructure captures order book snapshots, executed trades, and covers 15+ major exchanges across spot, perpetual, and futures markets.

Limitations

• Grades reflect order book conditions and may not capture all execution factors
• Data coverage varies by exchange
• Past performance does not guarantee future execution quality
• This analysis does not constitute trading advice