Start Your Own Cryptocurrency Exchange Online In 6 Steps

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Start Your Own Cryptocurrency Exchange Online In 6 Steps
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Cryptocurrency continues to pick up momentum, and there are many crypto enthusiasts going from digital currency buyers to cryptocurrency exchange owners. Starting your own crypto exchange allows you to benefit even more.

The process itself isn’t too challenging either. You simply need to follow a few key steps to ensure your exchange will attract users, and keep them. The flowing six steps can serve as your guide. Let’s dive in!

Step 1. Get Through The Red Tape

This is an important first step since you’ll be dealing with government agencies and oversight. For example, in the U.S. you will need a Money Transmitter license and meet the U.S. Securities and Exchange Commission (SEC), and other regulation overseers.

According to SEC considerations, “A platform that trades securities and operates as an “exchange,” as defined by the federal securities laws, must register as a national securities exchange or operate under an exemption from registration, such as the exemption provided for ATSs under SEC Regulation ATS.”

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To ensure you have all the needed licenses, get a lawyer. The nature of accepting money as an investment puts you in the currency exchange space, so having a lawyer who knows the currency exchange industry is a must.

However, depending on where you are located, or what country your exchange operates from, you may not need to meet as many guidelines.

Step 2. Get The Technology To Make It Work

Technology is the backbone of cryptocurrency, blockchain technology, and the exchanges that connect crypto buyers and sellers. This makes getting the tech necessary to make your exchange ops efficient and user-friendly an absolute must.

Luckily there are platforms in place that can help you develop and receive resources to customize a new exchange. In many cases, you can host your own exchange without monthly fee structures or commissions. This is also good, since overseeing agencies can request source code at any time, which you’ll have at the ready.

For instance, you may want to opt for a white label source code. This can be beneficial when customizing your cryptocurrency exchange pre and post-launch.

Step 3. Find Funding

Funding is essential for every new business venture. You first need to know the technology costs, such as site development and quality hosting services needed to be successful. Once you have a good idea about how much you’ll need to create your exchange, you can begin your hunt for funding.

This is an interesting step in the exchange development process because there are many people who are willing to invest in anything crypto or blockchain-related. One important thing to remember is that you are still a startup, and you’ll need to act accordingly.

The second biggest reason startups fail is lack of funding. To be successful, get initial funding that will allow you to develop an exchange that people will want to join, and ensure your backers have enough money for growth. Think both short and long-term funding to be successful as a new business.

Step 4. Have A Good Payment Partner

When starting a cryptocurrency exchange, you’ll need to find and partner with a payment processor. This seems simple enough, but there are a number of essential elements to keep in mind to ensure you get the best deal.

Low transaction fees are a must, especially if you want to compete with other more solidified exchanges in the industry. Be on the lookout for fees worked into the fine print as well.

One must-have when partnering with a payment processor is PCI-compliance to ensure cyberattacks don’t become an issue down the road.

Step 5. Be Security Conscious

On the topic of cyber attacks and hackers, cryptocurrency exchanges are highly vulnerable. This makes having security protocols in place for your exchange vital. If your exchange gets hacked, you can pretty much pack up the business, since many digital currency enthusiasts will not take your exchange serious.

Security protocols, such as two-factor authentication for sign-ins, Google authentication codes, cold wallets offline, and enhance encryption on databases can help keep your exchange safe, as well as keep your users’ information and money safe.

Step 6. Make Marketing A Priority

Once you have everything in place and have tested your exchange platform, it’s time to get serious about marketing. The fact is that if you don’t have a strong online reach that is highly visible, your exchange simply doesn’t exist.

Start doing outreach to all the cryptocurrency and blockchain technology sites, publish articles on Steemit, start your own blog to attract attention to your exchange platform, and even make use of traditional press releases. The more people see your exchange, the more likely they will join.

Develop A Successful Cryptocurrency Exchange

The above steps for starting a cryptocurrency exchange are important to follow. There are other caveats of starting an exchange, but the above serves as a strong foundation to move your new business in the right direction.

From legal support to marketing, starting an exchange may have a few speed bumps, but it is not as challenging as many may think. Take your love for cryptocurrency to the next level and become the exchange crypto enthusiasts like yourself will trust.