Are you considering launching a cryptocurrency exchange? It’s never been a better moment to get started. The cryptocurrency market is expected to reach $1 trillion in global sales by 2022, growing at a CAGR of 6.18%. For the first time in a decade, the trading market for cryptocurrencies is experiencing the quickest turnover in hours. The cryptocurrency exchange software development has soared in popularity since it is viewed as the breakthrough that everyone is awaiting.
Important Elements Of A Crypto Exchange Platform
Graphic User Interface
The appearance of a cryptocurrency exchange must be properly crafted to ensure optimum accuracy. It’s critical that it’s easy to use as well as visually appealing. Both newbie and experienced cryptocurrency traders should find the app’s design appealing.
The crypto exchange platform employs an algorithm to match buyers and vendors. Sophisticated matching engine algorithms make it feasible to conduct buy/sell transactions quickly. You must have a smart matching engine in place in order to attract and keep more customers.
A product’s ability to be acquired or sold is still heavily influenced by its liquidity. If your exchange has a high amount of liquidity, crypto traders are more likely to use it. You may boost your liquidity in several ways by allowing consumers to access several order books and by listing other cryptocurrencies.
You’ll need a wallet if you wish to trade cryptocurrencies like Bitcoin, Ethereum, or any other. Cryptocurrency exchanges must be linked to a secure wallet in order to securely store and exchange digital currencies. Your platform’s customers may retain all of their crypto assets in one place if you provide them with a multi-currency wallet.
Cryptocurrency Exchange’s Security
Cryptocurrency exchange platforms must be secure in order to appeal to their target demographic. Since a number of well-known cryptocurrency exchange platforms have been breached in the past, you need to beef up your own security in order to provide your customers peace of mind when trading.
How To Launch A Crypto Exchange Platform?
Ensure That All Necessary Permits Have Been Obtained
Before implementing your plan, speak with an attorney to understand more about the legal requirements that may apply to your new business. For each nation in which the company plans to do business, it must first get the necessary permissions. Governments throughout the world have been unable to keep up with the rapid developments in technology. In the United States, however, crypto exchanges are required to be registered as Money Transmitter businesses in order to comply with SEC and CFTC requirements.
Obtain Capital from Venture Firms
Before you begin, you should have an idea of how much your project will cost. To start and maintain a cryptocurrency exchange, you’ll need at least $135,000. Technology, hosting, first legal advice, government registration, and initial promotion are all included in this price tag. The company must have access to enough financing to get off to a good start, even if not all of it is raised up front.
Many businesses fail to plan for the future, which results in low early funding to pay development costs while leaving the company short of crucial operating capital. Some startup firms are known to grant licenses to unethical crypto exchange providers that charge ongoing fees but fail to reveal the legal obligations or expenses required to set up and operate an exchange. You must not fall into that trap!
Hire a Cryptocurrency Exchange Expert
It takes a lot of time and work to build a cryptocurrency exchange platform. Subject matter professionals, top executives, blockchain developers, blockchain analysts, crypto marketers, and financial advisors are all needed to do this. There is no way for small businesses or solopreneurs with limited funds to build a crypto exchange platform in-house.
Increase Your Liquidity by Trading With Others
Any exchange’s performance is dependent on the availability of liquidity. If your new company doesn’t have an active order book and trading activity, potential customers will be suspicious. These worries can be avoided if other exchanges are linked up with your new one, improving its liquidity. Your new exchange will be easier to get up and operating if you have other exchanges on the same network.
Use a Payment Gateway Service Provider
Different payment processors use different standards. You must have the lowest possible transaction rate in order to contend with other exchanges. Make sure you read the small print before signing anything with a payment gateway since some of their contract agreements include hidden expenses!
Implement Best Security Procedures
Trading cryptocurrencies is often ignored by people because of worries about safety and confidentiality. You must ensure the safety of your exchange and the confidentiality of your traders’ financial assets and personal data. Mt. Gox, a Tokyo-based Bitcoin exchange, filed for bankruptcy, claiming hackers had stolen $460 million from its bank accounts. Many anticipated the collapse of digital currencies in the aftermath of the tragedy, which shocked the crypto world.
In contrast, security enhancements have fueled the expansion of the cryptocurrency sector in recent years. However, hackers are still drawn to crypto exchanges. It is therefore imperative to ensure the safety of your business.
Organize a PR and Marketing Plan
Forming connections with established crypto exchanges like CoinDesk is critical after your exchange is up and running. Your marketing activities and the accompanying expenses must be properly budgeted if you want to avoid scrambling for more money after your initial fundraising. Without a dedicated marketing team, exchanges sometimes struggle to draw in enough traders to stay in business.
Service Your Clients Like a World-Class Business
We currently live in a customer-centric business environment because of the various options accessible to customers. A good customer experience and help may persuade your clients to stick with you.
Always Have Legal Support on Hand to Ensure Compulsive Adherence
There are two ways to make sure your exchange complies with local regulations: hire full-time in-house legal compliant specialists or outsource the task to reputable law firms.
Important Points To Consider To Make Your Crypto Exchange Successful
- Intuitive User Interface
While creating the most cutting-edge cryptocurrency exchange, most companies overlook the need of a simple user interface. People will always find it simpler to use an online portal if it has an excellent User Experience (UX). Be mindful of the fact that you’re creating your platform for both novices and veterans.
It is possible to keep the cryptocurrency exchange uncluttered while still offering all the complex trading features you need. Developers must ensure that consumers can easily find and use the features they need while establishing a new trading platform. Moreover, making your platform mobile-friendly has become increasingly important in light of the growing popularity of mobile trading.
- The User Administration Module
A dedicated dashboard for administering users and the exchange is essential for operating a crypto exchange efficiently. Everything from KYC and AML to client administration and application optimization should be managed from a single dashboard.
Customers should be able to make simple profile adjustments like updating their phone number or email address. Investors always seek easy access to basic functions like seeing trade history, managing funds, and modifying personal information.
- Establishing a Safe and Secure Setting
Any cryptocurrency exchange platform should put the privacy and security of its consumers at the top of its priority list. Having a large quantity of cash and crypto assets held on the crypto platforms implies that firm operators should not put anything to chance. Keep your platform safe and secure by implementing many layers of protection. AML and KYC should also be included in the security elements that developers implement.
To ensure the safety of the whole ecosystem, professional developers must implement extra security measures. Anti-DDoS plugins and secure wallet integration should be addressed while developing a crypto exchange’s security extensions.
- Multiple Layers of Security for Logins
SQL injections and other trespassing tactics are used in the bulk of cyber-attacks. Your platform must be protected from any unauthorized logins or signups. Fake login attempts must be prevented by the system.
Additional security measures, such as using two-factor authentication (2FA), eliminate the chance of password theft or hacking. Enforcing two-factor authentication (2FA) for all users is an effective technique to safeguard your platform.
- Support for Numerous Cryptocurrencies
Having a large selection of cryptos on your platform is essential because they are so extensively utilized nowadays. More than Bitcoin, Ethereum, Litecoin, and XTC, there are other cryptocurrencies that are traded on a daily basis.
Therefore, you should conduct market research to learn which cryptocurrency is most popular within your target market. Always keep future scalability in mind when designing an exchange, so that you may expand support for other coins in the future.
- API Integration
It is essential that your Bitcoin trading platform incorporate API integration. It allows for greater adaptability and freedom in the integration of different services and the improvement of the user experience. For many people, open-source software offers several advantages. API integration helps you to swiftly deliver these services to your customers and increase the number of users on your platform.
Third-party APIs allow you to give real-time market insights to customers. This functionality makes it easy to make your platform future-proof and adaptive to new advancements.
Cryptocurrencies are slowly gaining acceptance across a wide range of countries and large enterprises. As more countries open their doors to cryptocurrencies and token development services and the crypto ecosystem builds further, they will become more generally acknowledged. With this, investing in crypto exchange software development will allow you to take advantage of several opportunities.