The size of the billion-dollar cryptocurrency market is a testament to the burgeoning popularity and global adoption of cryptocurrencies. The number of cryptocurrencies has grown to over 2,300 through 2019, according to CoinMarketCap, and the market has witnessed an incredible increase in the number of crypto investors over the past decade.
Earlier, people preferred Bitcoin mining to earn rewards, however, the reduction in block rewards has shifted people’s interest to cryptocurrency exchange development. Businesses and entrepreneurs globally are choosing to create cryptocurrency exchange platform to enter the crypto market and rake in huge profits. Binance, one of the leading crypto exchange platforms, hit a massive $1 Billion mark in cumulative profit, out of which $183.5 Million was made in Q3 of 2019 alone.
The stats reveal that setting up crypto exchange is a huge opportunity that can be capitalized by crypto enthusiasts looking to start a crypto exchange for revenue generation. If you are planning to make your own cryptocurrency exchange – be it from ground zero or white label exchange software – follow a well-orchestrated approach to create crypto exchange platform that can bring you profits.
This guide will walk you through how to make your own cryptocurrency exchange. Let’s delve into the step-by-step guide.
Step 1: Identify the type of exchange you want to launch
Identifying the type of crypto exchange that you want to launch is crucial. To make this decision, it is important to understand the different types of exchange platforms in the first place.
Centralized exchange: A centralized exchange involves a middleman or a third party for crypto transactions. This is why it is seen as a trustworthy exchange by traders. Since an intermediary is involved to handle the transactions in a centralized exchange, this type of exchange charges around 0.1-1.5 percent of the trading fee. It means that as an owner, if you choose this option to start own crypto exchange, you can earn through the trading fee. Besides, a centralized exchange offers high liquidity and is thus popular among traders.
P2P exchange: A P2P (Peer-to-Peer) exchange executes transactions without any third party involvement and connects the buyers and sellers directly. However, the third party comes into play for dispute redressal. This type of exchange is usually underpinned by a smart contract-based escrow system to drive trusted transactions. A P2P exchange is also popular among traders so it can be also an ideal option to create your own cryptocurrency exchange.
Decentralized exchange: A decentralized exchange facilitates transactions without any intermediary. This type of exchange platform is not much prevalent thus it lacks liquidity. However, a decentralized exchange offers better security than both centralized and P2P exchanges.
Once you have decided on the type of exchange, find out whether you want to build cryptocurrency exchange website from scratch or rather go with white label crypto exchange software.
Step 2: Conduct thorough market research
Any project should be backed by extensive market research as it helps solidify your decisions. Do rigorous research to identify current crypto market trends and the anticipated price of cryptocurrencies in the year 2020. This will help you decide which cryptocurrencies should be listed on your exchange. In addition, find out what features do traders seek in a cryptocurrency exchange. Integrating the most sought-after features into your exchange will help you acquire more users and amplify your revenue generation opportunities.
Hey this is realy interesting man. Did know such thing actualy exist regrding exchange mathod. Thanks for sharing such vakuable infoemation