In this article, we shared with you our opinion on how to start a cryptocurrency exchange website development. Let’s get started.
Cryptocurrency is a type of digital currency. Cryptocurrency uses blockchain, a secure, unalterable, decentralized ledger that keeps track of transactions. These transactions take place from peer to peer through blockchain with no intermediary, such as a bank, which allows them to take place efficiently
A crypto exchange is a platform on which you can buy and sell cryptocurrency. You can use exchanges to trade one crypto for another — converting Bitcoin to Litecoin, for example — or to buy crypto using regular currency, like the U.S. Dollar. Exchanges reflect current market prices of the cryptocurrencies they offer. You can also convert cryptocurrencies back into the U.S. Dollar or another currency on an exchange, to leave as cash within your account (if you want to trade back into crypto later) or withdraw to your regular bank account.
Cryptocurrency transactions are verified on the Blockchain, paving way for a decentralized value exchange. A Cryptocurrency Exchange platform development allows buyers & sellers to exchange their coins with other coins or to further sell or buy the crypto currency with the market trends.
Cryptocurrency is considered as future money. It leads to several companies and governments of different countries to invest in digital assets. Besides, it doesn't involve any third party. The software is responsible for the encryption of the digital currency. Due to the fame of bitcoins globally, various cryptocurrencies have entered the market. In fact, it is one of the most demanded forms of online investment in today’s world.
• High performance
• Secure and reliable
• Highly customizable
• Cheaper and faster
• Advanced control panel
• Enhanced buy and sell system
• Two factor authentication
This is the most common type of exchange. Such exchanges have a centralized operator who is responsible for security, updates, and functionality. Centralized exchanges manage order books, which record all buy and sell orders. The weak point of this type is that coins are stored in the services themselves, which increases the likelihood of losing your funds due to hacker attacks. Therefore, centralized exchanges work hard to ensure the proper level of security.
Decentralized exchanges provide transfers of funds directly between users' wallets. This reduces the potential for theft from exchange hacking since the exchange never actually stores cryptocurrency. However, you should keep in mind that in such exchanges, the lack of moderating third-party shifts all responsibility for errors and security to the users themselves
A customer saves up their time as the platform is ready-made. In fact, the characteristics and the work ability are already tested and used by various other traders.
P2P exchanges provide the sale and purchase of cryptocurrency directly between users. Traders leave their orders as on a bulletin board, and other network participants can respond to the offers and agree on the terms of buy/sale.
The white label cryptocurrency exchange software is highly customizable and secured. At the same time, it allows customers to trade in top-notch currencies.
With the use of this platform, several projects can gather funds using the software’s database. The details of the investors are verified by the exchanges relieving traders from the hands of getting cheated.
One-page Exchange development eradicates tedious KYC authentication thereby making it easier for customers. The traders can strike a deal between numerous kinds of cryptocurrencies.
The marketplace place is decentralized which means that no form of third parties would interfere while trading. Therefore, private details of traders are restored by the exchange. Users are verified before they are allowed in the marketplace.
The cryptocurrency currency can be well compared with a bank account. It lets you store your sum and also transact when required. To ensure safety a two-way authentication process is maintained.
Blockchain development lets customers trade sitting at the comfort of their own space. The cryptocurrency exchange software development can be accessed using phones as well as laptops.
Smart Contracts can be used by a trader endlessly. The entire process does not involve any form of a third party. This service lets a trader hire a smart developer whose task is to help traders find a suitable business contract for the progression of firms.
This service includes encryption of data which helps secure transacted data and personal details of a customer. When a customer fails in their attempt to log in several times then they remain blocked for a particular period of time from using it.
The service includes encryption of data so that private details about a trader is not revealed to anyone. Apart from this, customers are able to trade sitting anywhere and anytime. The app is made user-friendly, it is suitable for Apple and Android users.
The first and essential step to build your own bitcoin exchange website is to have thorough research about the competitors. For every kind of website creation, it is excellent to check out the existing website providing the bitcoin exchange.
For every business startup, knowing your competitor is the first and most crucial step. So, to start a Bitcoin exchange website, it will be great to do some research on existing Bitcoin websites and know their rating and reviews on google.
As they are the competitors of your website and researching them will provide you with an essential strategy to create a bitcoin exchange website. It is best to narrow down all the competitors to have plenty of ideas to create a website in the best possible manner.
The next step is to find the area where you will provide bitcoin exchanges as bitcoin exchanges can vary from place to place, country to country or across the globe. Thus, when you build your own bitcoin exchange website, decide where it will be operated. This is also important as some countries do not allow bitcoin exchanges, and some have strict rules and regulations.
When you are starting a website, you need to check out everything globally and provide accordingly. If you fail or miss this step, you are likely to end up with problems in the end. For this, you must check your peers and areas where their website operates.
This is another step to make your bitcoin website exchange a success. Knowing the target audience before starting a website is a must to create content according to the audience you target. Like, bitcoin exchanges are not for kids or people who do not deal with bitcoin exchanges. It is for the people who work in bitcoin and want to invest in it. Know about the target audience and determine the success of your site in advance.
After you have decided the area, audience, and competition to build your own bitcoin exchange website, the next step is to create the website, which is an important segment. It is a must for you to create a website that is eye-catchy and alluring to your audience. Make sure the functionality and security of the website are high. Here are some core segments that you need to consider to build your own bitcoin website exchange. Maintain high speed for page loading and transactions happening on your website. People could get frustrated because of delays in any of the above two tasks. So, this is another criterion to pay attention to when you are creating your website.
Determining on the data distribution channel for your website is yet another essential step. Because choosing the accurate communication type will attract the customers more. There are two channels — Synchronous and Asynchronous distributed systems; you can select the best one depending on the need of your website:
• Synchronous method
Synchronous communication happens when you have devised specific technology like API, etc., to remain in contact with your customers in real-time.
Therefore, in the synchronous method, there is no gap between the data.
• Asynchronous method
Connecting with your customers by email messages. Here the provider and the customer are both not expected to be in constant contact. As a result, there is a gap between message delivery and receiving time, each computer connected with the other processes the information independently.
As Bitcoin is the most famous cryptocurrency, many people try to copy it. However, don’t forget that building a Bitcoin exchange website isn’t enough for your original cryptocurrency website. Except when you are going with the classic Bitcoin exchange website. Coding assembles all your ideas in one place. It holds them together. So, keep your mind open while selecting the software type for your website, as there are three broad types to choose from:
- White label software White label software is another popular choice. And that too for a very valid reason— they are pre-existing sets but can also be customized to suit your needs. This way, it takes less development time and can be modified a little. However, not all white label software offers that much coding freedom. They use the SaaS service model and are generally used on a rent or subscription basis. They are considered much more secure than open-source software.
- Use current open-source software. Open-source software is readily available on platforms such as GitHub etc. There is pre-prepared open source software for online cryptocurrency exchange websites. And in huge numbers for a Bitcoin exchange website. Until and unless you have a unique idea that needs all newly built software. Go with the pre-existing software. These are free of cost and also save a lot of development time. If you don’t want to utilize your money for the whole software development process, this is the most cost-efficient method.
- Built an Internal software For this, you have to conjure up a large development team. Also, this is the most expensive method out of the three. It takes almost a year-round to complete all the coding, testing, etc. This is, though, as much beneficial as costly. As a result, a whole online cryptocurrency exchange software development right from scratch will give you an upper hand. Moreover, you can take time to closely observe and improve the back-end and the front-end coding, etc. ### Step 7. Payment processing Finding a bank or any other payment processor is not an easy task. Many banking institutions are skeptical of any cryptocurrency. Therefore, you need to start your payment processor-hunting a tad bit earlier. Most importantly, do not open a personal bank account. That could get shut down immediately because the bit transactions require immediate transactions of high amounts. This will not work if you open a personal account with a bank. So, the frequency and speed of transactions are two essential factors to consider while choosing a bank. As a result, choose the favorable bank or any other payment processing system like the cryptocurrency payment apps. If you are selling goods or services and want to use your cryptocurrency for that purpose, many such payment apps are available online. ### Step 8. Launch the marketing plan Now that everything is set. The software has been developed. Launching a website should also be strategized. Prepare a well-set plan to promote and market your presence. Creating an inside network is the first step. Next, think of outside promotions. So many currently working online cryptocurrency exchange websites use digital marketing as the best source of attracting potential customers. ## How does Cryptocurrency Exchange software development works? Just as cryptocurrency is based on blockchain technology, the cryptocurrency exchange software or platform is also based on blockchain technology. The heart of cryptocurrency exchange software is its trading engine. It matches buyer and seller orders, executes transactions, and calculates balances. ## Build the best cryptocurrency exchange website architecture ### A basic architecture solution for the cryptocurrency exchange website will include the four necessary steps: • Trading engine. Without this core part, the whole mechanism cannot work. A trading engine should have unhindered access to the order book, match all the purchasing and selling orders, process transactions and calculate balances. • Frontend. Your UI ought to be fully configured for quick and smooth trading and transaction processes. Try to make it intuitive and user-friendly for your clients to find their accounts, see all the significant changes of the exchange rates as soon as possible, deposit crypto or fiat money, and place any orders. • The wallet. The electronic wallets for the digital currencies you provide on your website should enable a very quick and easy launching, yet secure operations of withdrawal of your virtual money and converting them to the fiat currency. • Admin panel. This powerful dashboard is ought to help the administrator run the trading operations as well as verifying processes, create liquidity, and provide helpful and professional customer support. ### Ensure the corresponding level of security Digital money is all about being truly protected and secure. We would advise you to commit to that principle, as it was estimated that almost half of all the cryptocurrency exchange businesses have closed because of being hacked.
Make sure your website is an absolutely safe base for all the transactions, ICO, and money withdrawals that you will hold. The same must be applied to your clients’ sensitive personal information, as it must be protected much severely these days than it used to be.
Today’s technological market is fully ready for adventurous entrepreneurs aspiring to launch their own digital currency exchange startups. That is why it may offer you a starting software package. Such websites as BTC Trader or Alphapoint can offer you a ready-made exchange solution.
Apart from a web exchange solution, be sure do not forget about the additional mobile app development, as it may increase your revenues significantly. However, it may be a good idea to resort to the customized software pack you prefer for creating a convenient brand new exchange facilities.
Practically all services operating with currencies should adhere to the Know Your Customer (KYC) policies, which imply checking passport or some other ID data in order to confirm the client personality. The main goal of following such policies is to exclude scamming possibilities in the exchange network.
Any exchange website must support as many significant crypto and fiat currencies as possible. In such a way the developers ensure a broader client audience and quick international expansion.
However, a necessary manual integration of every currency you support may become a challenge, that is why it would be impossible to launch an exchange service with numerous digital currencies. So you will need to run profound research to analyze your target market and see what currencies would be the best choice for your startup. Apart from popular Bitcoin and Ethereum, you should also take into regard Litecoin, Ripple, and some others.
At the moment of launching your exchange business, you should artificially model demand for your service. You can do that in two ways:
establish activity by buying and selling crypto using profiles you also manually create;
connect to the network of other exchanges to acquire liquidity of all services that are already connected to it.
After the launch of the platform, you should hire at least a couple of employees that would take care of support. It’s crucial to provide utter accessibility of the support services – i.e., the support employees should react fast and help with the required competency.
Regarding various challenges that you need to overcome while building your own cryptocurrency exchange facilities, it cannot but be a costly process. However, with a smart attitude and much of entrepreneurial spirit, you will be able to launch your startup with a very reasonable pricing policy.
Regardless of your choice of software, your perfect team should include project manager (unless you don’t want to take this position by your own), platform developer, QA engineer, experienced web designer, and a UI developer. The cost of their services will vary significantly depending on several factors. The most important here is probably your team’s country of location.