How to Start a Business of Cryptocurrency Exchange?
Cryptocurrencies like Ethereum, Bitcoin and Dogecoin are trending. People who have mined or invested in bitcoin are dedicated to making their fortune, and it is amazing to see the growth of the crypto world and cryptocurrencies are thriving in the mainstream. Even an investor named Peter Lynch once said a statement about bitcoin, which means that it might be possible that miners may lose money, but people who are investing in it can make a really good profit. The Crypto world offers thousands of opportunities to those who are willing to take the risk.
People who want to invest can start the bitcoin business of cryptocurrency exchanges. Crypto analysts recommend that people start a crypto exchange business because they observe the potential rewards that a crypto exchange business offers. If you are the one who is interested in starting a crypto exchange business, you can check out all the steps that are involved in starting your business. You can also choose to trade bitcoin by joining the bitcoin trading community here.
Acquire legal advice to ensure all the licensing conditions are completed
Before you convert your plan into action, you must acquire legal counsel to know about regulatory demands for starting a crypto exchange business. It is mandatory to obtain proper licenses for jurisdictions in which your business is planning to operate. Exchanges must also adhere to all the Anti-Money Laundering and Know Your Customer regulations which have now become important to battle money laundering issues.
Acquire proper funding for the venture
It is crucial to understand all the costs that are involved in your venture. In order to start a business of crypto exchange, a minimum of $135,000 is required. This minimum cost involves legal counsel, advertising, hosting, technology, and government registration. This cost won’t involve all the funds, but it is important to understand the initial capital that is required to allow a runway. One of the major mistakes that most investors make is not planning about the costs and failing to carry out a proper business.
Find the right cryptocurrency technology solution supplier.
There are some services that provide crypto exchanges the license without charging any commission or fees. There aren’t any ongoing costs involved in it, and clients host the crypto exchange all by themselves by receiving the source code. This is also quite crucial for auditing purposes as many regulators inspect the code to understand the reliability of code. Services also offer backend technology that the largest crypto exchanges are using.
Get in partnership with a reliable payment processor.
Crypto exchanges are required to be in partnership with payment processors, and in reality, it is imperative to select the payment processor carefully. Reliability, fee structure, and many other things vary from company to company. For your crypto exchange, ensure that the company is reliable, offers low transaction cost with fast processing speed. Multiple other differences are there that include compliance with PCI DSS, transaction processing and settlement time, and best security practices that must be taken into consideration to ensure there is no threat to exchanges and coins. Please make sure the payment processor you choose must be PCI-compliant as it will protect your business against malware attacks and hacks.
Use the right security measures.
Exchanges should implement the best security measures, including encrypted wallets, offline storage wallets, two-factor authentication, and more. There are few technologies that only store hashes and not passwords. A lot of security breaches have occurred that are infamous in the crypto industry. Cryptocurrencies have become an easy target of cyber attackers for hacking and cybercrimes, and this has made it mandatory to adopt security measures. The investor must never leave their exchanges or wallets for cyber attackers and must use appropriate security practices.
Provide good customer support
A customer seeks the best services from the crypto exchange, and you can make your exchange reliable by gaining the trust of your customers. Trust can be accomplished by offering the best security and customer support to customers. Crypto exchanges must provide satisfactory answers or resolve the technical issues and other complaints of customers. Additionally, there should be proper timing in which customers need to be responded to, and this can be done by implementing the ticket system where customers raise tickets in case of issues or complaints.