Build An Awesome Cryptocurrency Exchange Using These 7 Steps
Believe it or not, cryptocurrencies and allied activities no longer fall under the shadow of the niche label. After Bitcoin’s commendable run in 2017, cryptocurrency has become a global phenomenon. Not only did it bring innovative crowdfunding models like ICO, IEO, and more, it also opened a Field of Opportunity, as singer Niel Young would croon.
With cryptocurrency often touted as the future, it provides budding entrepreneurs with a galaxy of business initiatives. One such opportunity is that of cryptocurrency exchanges. They can be compared to traditional forex platforms that allow the exchange between different fiat currencies. With more than 2200 cryptos in circulation, the possibilities are endless.
By including a few additional features like margin trading, trade bots, binary options, and more, crypto exchanges are now a multi-billion dollar endeavor. A simple scroll on CoinMarketCap will reveal that the daily trading volumes of many platforms are in the vicinity of the three comma club.
Interestingly, it is very easy to enter the exchange business. With the presence of many technology solution enterprises, launching a platform is a matter of days. However, it’s easier said than done. As a rule of the thumb, a business person should always do his/her research before committing. Fortunately, this article serves as a primer that will guide you through the different stages involved in Building a Robust Crypto Exchange.
1) Checking The Legalities
It is always wise to understand the legal aspect associated with cryptocurrencies. While a few countries like Estonia, Malta, and Singapore are regarded as crypto-friendly countries, many other nations are still on the fence. Hence, take steps to ensure that you understand the different crypto-related regulations and legislation of your country.
2) Attracting the Seed Funding
Capital is the life-blood of any business prospect. When it comes to setting up a crypto exchange, multiple components come into play such as hosting, registration, and much more. All of these cost money, so it is essential that you find a means to raise funds for your project. Alternatively, plan a budget that takes into account major expenses and leaves you enough capital for your runway.
3) Selecting A Technology Partner
Cut down costs on development by hiring a competent technology partner to build your platform. Today, with many firms offering white-label and customizable solutions, an entrepreneur’s task is simplified. Lastly, it always helps to verify the credentials of the firm beforehand.
4) Getting The Initial Crowd
First impressions matter; hence, it is critical to feature a user-friendly interface and a feature-rich platform. Moreover, including lower transaction fees and referral programs will help build a good rapport with your customers. Additionally, it is always a good idea to support a fair mix of popular as well as niche cryptocurrencies.
5) Optimizing Trades And Withdrawals
When choosing an exchange platform, a customer takes into consideration the transaction speeds and liquidity options. Thus, take steps to allow the easy deposit and withdrawal of funds. Moreover, provide support for a variety of payment options such as net banking, credit/debit card, and even cryptocurrency. With cryptocurrency trading heavily dependant on price volatility, put in place protocols that facilitate higher throughput rates.
6) Bolstering The Platform’s Security
Do not ever overlook the aspect of security for your platform. Hackers are constantly taking advantage of vulnerabilities and stealing funds as well as user data. However, you can easily avoid this and protect your users by enforcing a number of security practices such as two-factor authentication, jail login, multi-sig wallets, and much more. And, just like the saying, prevention is better than cure, make it a practice to organize security audits of your platform regularly.
7) Promoting Your Brand
Marketing plays a significant role in ensuring the success and prominence of your platform. Put together a campaign that will effectively promote your product and attract users en mass. Make use of social media platforms as well as advertising portals to increase your reach.
Currently, the market cap of the cryptocurrency market stands at an enormous $287 billion. Experts suggest that this figure could increase substantially in the coming months. Moreover, cryptocurrency exchanges have played a very critical role in actively pushing the boundaries of the cryptocurrency’s pricing. Thus, Launching your own Exchange Platform can be a very profitable endeavor.