Build Your Crypto Exchange and Endorse Your Currency
An exchange has the power to provide accessibility and advertise your crypto currency. Bitcoin, Ether, Litecoin - all functional currencies that can be traded, need a good exchange for users to feel comfortable enough to trade them. But the question is: How to build a perfect one?
Exchanges are for the Community
When you first decide to research them, your first thought isn’t how this is going to greatly help the community, it’s the business point-of-view of earning. A good cryptocurrency exchange though is a very powerful tool. It can help people access these cryptos much easier and can help demystify the technology, which can lead to a spike in interest from other entrepreneurs wanting in.
Be warned that this s not an easy process. Many new technologies are first shunned because of our incredible resistance to change. Examples are technology like electric cars or underground boring tunnels - I’m looking at you Musk - many groundbreaking technologies are generally refused at first. This is why having a place to trade can play an important role. The point of it is to help cryptocurrencies’ integration.
What Makes a Good Crypto Exchange
The primary concern is security. Security is what draws people to your exchange because it is so vital. Cryptos such as Bitcoin and Ether have the advantage and disadvantage of being completely anonymous. This means that you can transact without anyone knowing who you are, but this makes the money irretrievable - the disadvantage that you have to cover for.
Exchanges can guarantee this security in the form of proprietary wallets, two-factor authentication, methods of confirming transaction authenticity, etc. These are all the baby-steps that have to be taken to ensure a great start.
Although security can be guaranteed much easier (because of the nature of the technology itself), the biggest common issue we came across during research was the overly-complicated User Interfaces(UIs). Most of these traders are not beginner friendly. With market stats, conversion rates, trading options, balance settings, deposition panels all in one page, you’d think the design overkill would make it easier... but not really.
Going through the standard procedures of the current top five exchanges, you can easily tell how much of a hard time anyone trying to first access cryptos will have with these services. They’re just too frustrating! Most of them, consciously or unconsciously, complicate their services far too much, shooing away a large portion of their earnings from the beginners who they’re not helping out.
Any basic exchange should have a:
- Trading Panel - This should have all the trading options of buying and selling, showing and executing orders, along with ledgers of all purchases.
- Friendly UI - An intuitive UI is core. Showing only what is needed to the customer at the right time can ensure a good flow during the time of a visit. Sometimes less is more.
Things should have clear divisions. Registering and logging in, maintaining your deposits and withdrawals, placing orders, transaction history, these should all have clear lines that separate them.
- Proprietary Wallet - A standard, private wallet for instant access and an offline wallet for bigger deposits. The first wallet can be accessed at all times and can be used for immediate transacting and depositing, while the second one can only be accessed through more complicated authentication methods. This is to ensure that a client doesn’t have to hold a currency that he/she isn’t circulating.
- Management Panel - The administrator features should be added here. Things such as: confirming a trade after it has been approved, crediting deposits, approving accounts as eligible for trading, etc. This is for the operators of the exchange and should be structured as such as to avoid unnecessary headaches for admins to make changes.
These four cornerstones can behave as the basis for a successful start, but the execution is everything. Using research and data, designers can create user stories and carefully tinker the features to find appropriate positions for each element. The user is the center of attention.
Finally, the focus is on regulation. What laws does the country you want to operate in have on cryptocurrencies? Each country operates with their Know Your Customer (KYC) and Anti-Money Laundering (AML) laws and regulations to prevent fraud and tax evasion. These regulations differ from country to country, seeing as some countries might ban you from trading any sort of crypto, whereas some might not have any regulation at all.
This affects your exchange in many ways. It could either allow for it to be decentralized or not. Some companies were forced to share their user transaction data because of KYC and AML standards, while some operate on a thin line. Choose the country you’re going to operate in very carefully, always being in-line with the system.
Exchanges Really are for the Community
Although your exchange can enable the community to transact more easily, it can open many paths for a whole crypto community to open around them. Allowing people to trade in these cryptos could mean new entrepreneurs or corporations finding their own ideas to develop.
With more and more developers offering services specially tailored for entrepreneurs and corporations, such as rapid prototypes, proof of concepts, or minimum viable products, your exchange could start a whole new trend in your community.
This allows for brand recognition and opportunities for larger growth beyond just your local exchange.