The steps to follow during the process of Exchange Platform Development in 2020
As cryptocurrencies continue to disrupt the operations of several industries, it has a strong future ahead courtesy of its consistent adoption. Investing in a reliable exchange platform for dealing in cryptocurrencies has become a profitable business today. Let us know more about the dynamics behind exchange platform development.
Meaning of a Cryptocurrency Exchange Platform
It is an online marketplace where buyers and sellers deal in digital currencies at market rates. These platforms act as an intermediary between customers and traders of virtual currency.
The different types of exchange platform development available in the market
- Centralized exchanges – It involves a custodian who manages the user’s funds while a third party executes the transactions for a corresponding trading fee. Of late, their reputation has suffered a dip due to multiple incidents of hacking. Though they provide sufficient liquidity and can handle substantial trading volumes, security lapses are an area of concern.
- Decentralized exchanges – They are the exact opposite of Centralized exchanges. There are no intermediaries involved in transferring funds. More freedom is provided to the users for handling daily operations. Though liquidity is a bit less, there is no compromise on security.
- Hybrid exchanges – They combine the aspects of both centralized and decentralized exchanges, ensuring a seamless balance between liquidity and security. It promotes a peer-to-peer mechanism for trading. Third parties play a role in dispute redressal. A smart contract powered escrow system executes transactions quickly.
Points to take into account before investing in Exchange Platform Development
- Undertake market research – Since every country has its demand and supply conditions, study the prevailing situation carefully. Decide the prices to be fixed for different digital assets, the countries where an official launch is going to be planned, and discuss with experts the features needed in the platform.
- Figure out an ideal location for operations – Not all governments in the world welcome the existence of cryptocurrencies with open hands. Few countries such as the USA, UK, Japan, Singapore, Switzerland, and Malta are friendly towards cryptocurrencies. On the other hand, some nations like China, Saudi Arabia have restricted the operation of cryptocurrencies.
- Comply with existing regulations – Make sure to follow the guidelines issued by a country’s regulatory authority. Not following them with due diligence can lead to cancellation of license, curtailment of operations, and increased overhead costs.
- Employ a legal team – Keeping in mind the risks and volatility involved in cryptocurrencies, it is better to hire legal experts who have good knowledge of different market conditions. They will guide a firm in the right direction. Lawyers will help to deal with the KYC (Know Your Customer) verification process and the AML (Anti Money Laundering) guidelines. They can scrutinize the identity proof of users such as passport and license effectively.
- Decide on the cost to build a cryptocurrency exchange platform – While different solution providers quote various prices for the platform, it depends on factors like technology stack to be used, features to incorporate, and the type of exchange to be utilized. Make sure you have the required amount of funds sufficient to withstand the different development stages involved in the process. Firms that want to save costs can opt for a readymade Whitelabel exchange platform with all the necessary features in-built.
- Partner with a well-known and experienced provider – The development team plays a crucial role in the success of your exchange platform. Check out the projects they have worked in the past and the clients they have teamed up with. Ensure that the company’s team has members who specialize in different areas such as blockchain development, designing layouts and interfaces, marketing specialists, and financial advisors.
- Efforts needed to satisfy the target audience – Once the exchange platform is fully functional, promote your offering across various channels using free and paid tools. The main aim should be to improve user retention. Utilize strategies such as SEO, PPC, email marketing, social media promotion, public relations, posting content on discussion forums, establish bounty programs, and indulge in reputation management.
- Technical support – As all users will not be comfortable handling the different operations at one go, make sure to have a dedicated support team to handle queries and resolve glitches swiftly. It should function round-the-clock in multiple languages. A robust technical support facility helps in building trust and reliability in the long run.
Some of the vital features needed in every Cryptocurrency exchange platform are
An exclusive dashboard to monitor operations, presence of adequate liquidity, 24×7 technical support in multiple languages, high-level security measures such as encryption and two-factor authentication, multi-device compatibility, availability of numerous payment methods and an integrated referral program are the essential features to be present in a Cryptocurrency exchange platform.
Follow all the above guidelines for ensuring success in your exchange platform development process. For developing a well-performing exchange blended with all the latest features, reach out to the accomplished developer team of Blockchain App Factory. Their unparalleled experience will result in a customized and market-oriented solution that will fulfill your business objectives smoothly.