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Crypto Trading, Cryptocurrency Exchange, Featured, Finance

How a Cryptocurrency Exchange Development Company Can Boost Your Crypto Business

Cryptocurrencies continue to scale new heights. Secure trusted crypto exchanges are exciting growth avenues for investors, especially day traders. A global cryptocurrency exchange development company with active deployments across 5 continents- HashCash Consultants ensure that the final implementation far exceeds your initial product vision.  

Cryptocurrency Exchange Development: Essential Company Services

Rising Prominence of Cryptocurrencies

Bitcoin gained over 1930 times its original value between 2012 and 2020. With a 66% surge within a month’s span during February 2021, the current global valuation of Bitcoin has surpassed the coveted US$1 trillion mark. Daily crypto trade volumes increased and reached an average index of $113.2 billion with an initial high of $113.2 billion.

The era of blockchain and cryptocurrencies is imminent. Over 300 crypto exchanges worldwide provide crypto to fiat trading services and vice versa. In a survey, 97% of 60000 investors expressed interest in Ethereum or Bitcoin- looking forward to future investment ventures. Bitcoin with a daily transaction amount of US$6 billion is outshined only by legacy companies Visa Card and Mastercard($30.3 billion and $16.2 billion respectively). 

The above statistics bring a conclusion- Mass proliferation of Crypto Exchanges is Inevitable.

Also Read: Bitcoin’s Bull Market Repeats History: Fuels Another Boom

How do Crypto Exchanges Work?

Crypto investment is steadily increasing due to its volatility. Seasoned investors see the wild swings as an opportunity to gain high returns within a short time. Bot usage is also legal in several crypto exchanges leading to further profit maximization.

Cryptocurrency exchanges function as an intermediary between registered buyers(takers) and sellers(makers). Fiat payments materialize through bank transfer, wire, PayPal, or other conventional methods. The exchange earns transaction brokerage- a conversion fee is charged for trades in between cryptocurrencies. Similar to the stock markets or forex, a crypto trade occurs when the taker places a limiting bid and the specified virtual asset is available from the maker’s end. The entire transaction occurs in seconds. 

Centralized Exchanges or CEXs function like a bank. They act as a custodian protecting the investor’s assets. Transactions occur on the exchange database. KYC regulations and verification are mandatory. Fees charged are in proportion to the volume of completed transactions. CEXs enjoy high liquidity and often feature crypto/fiat pairings or crypto/crypto pairings. Derivatives based on Bitcoin will soon be launched in Europe

Tips for Setting Up Your Own Crypto Exchange

Entrants looking forward to entering the crypto trade business can choose between two paths: choose a white label exchange platform solution from a  cryptocurrency exchange development company, or set up their own platform from scratch The latter requires technical and programming skills, time, and resources. There is also a lot of ground to be covered, and a whole lot of trial and error. Truth be told, it makes no sense in sending the lion’s share of your resources and effort in just building the setup.

Anyways, a crypto trading business needs to tick the following boxes before starting off:

  • Legal Paperworks

Legal issues and complications must be straightened out at the very start of any business. In crypto trading, the requirements are selecting the right jurisdiction for the business, observing additional norms and regulations, and getting a legal license for providing crypto trading services.

  • Utilities and Services Offered

Finalize the type of trading services your crypto trading enterprise would be offering. It may be fiat to crypto trading, margin trading, or any other services.

  • Liquidity

Reliable crypto exchanges keep virtual assets with high liquidity to protect crypto clients from scam projects. 

  • Customer Support System

Since the cryptocurrency market is a new domain- high-end customer support and response system with multi-lingual capability is essential.

Cryptocurrency, Forex, and Stock Trading

Investors and day traders tend to choose between these three options. Stocks are the safest option for long-term growth and security.  Meanwhile, forex is the world’s largest trade market- with daily transactions exceeding US$6.6 trillion. Cryptocurrency trading is the latest entry as a new market. The crypto market shares common features with both, and it is an absolute must to have the ears wet before making a financial move. 

Analysis between Crypto, Forex and Stock Trading

  • Market Size

Forex’s market cap was confirmed by the 2019 Triennial Bank for International Settlements Report while noting a 29.4% rise since 2016. The total market capitalization of crypto amounted to something around $256 billion. The 2019 World Bank Report indicates stock trades amounting to $61.139 trillion annually- a significant drop from the 2015 high of $99.84 trillion. These figures are instrumental in describing the properties of each investment route.

  • Volatility

Stock markets move at a much slower pace compared to crypto and forex. Factors that determine valuation include performance, geopolitical conditions, future scope, and more. It is a better option for long-term investors. 

A long-term investment is a rarity in forex. Traders hold for minutes and hours, a few days at maximum. Rising demands increase a currency’s value. Like stock markets, forex valuations also depend upon different factors, including inflation, rate of interest, country’s balance of payments, debt owed by the central government, export and import price ratio, political stability, economic performance, recession, and speculation. In general, an extremely high rise/fall in a currency’s valuation is rare.

National and political factors do not play much of a role in crypto trading. Rather, it is based on demand and supply, along with the consensus derived from the underlying blockchain network. 

  • Liquidity

Cash flow is much higher in forex and stock markets. The two are existing as trade options for a longer period. They also have regulations. Crypto trade exchanges are still at a nascent stage. 

With steadily growing investor interest, cryptocurrency will take a few years at least to catch up, along with government backing. Several governments have declared cryptocurrency illegal. The Commodity Futures Trading Commission(CFTC) has not come up with its formal verdict on its classification of bitcoin, other than its definition as an asset. Meanwhile, other governments are accepting cryptocurrency as barter instruments, or legal tender. All these leads are hindrances to crypto exchanges around the world. However, things are improving for the better. 

High volatility almost always translates to low liquidity. Liquidity, or the ease of trading, refers to high activity volume in a market. Forex markets have low volatility and high liquidity- they have a better capability to absorb more shocks. Stable currencies can provide returns even during a bad economy.

  • Anonymity

An initial reason behind the popularity of crypto trading was anonymity. Investors were enticed by the idea of making confidential trades. With an increase in government regulations around the world, this feature has been capped for top players like Bitcoin and Ethereum. Smaller cryptocurrencies exist, and they can still be used to conduct anonymous transactions. 

Extensive use of crypto tokens in the dark web was the primary reason behind curbing the anonymity feature. Illegal activities around the world took advantage of blockchain anonymity- leading to the regulation of popular cryptocurrencies. KYC(Know Your Customer) forms are standard across established cryptocurrency exchanges. 

Interbank Market is the collective term referring to a worldwide network of forex brokers and financial experts. They regulate forex transactions throughout the world. Few forex companies offer anonymous trading facilities- taking a leaf out of the crypto market.

  • Market Timings, Fees, and Regulations

Stock market investments are common due to their relative simplicity. Several associated rules aimed at protecting the interests of investors and traders exist. The initiation process is time-consuming and resource-intensive. Trade timings are restricted, and investors need a broker to buy or sell. Also, transaction charges and processing fees are high. 

On the other hand, both cryptocurrency and forex can be traded on any day and at any time. The markets are open throughout public holidays and large-scale events. Accessibility options are also much better for investors, from every social standing. Transactions occur much faster in cryptocurrency exchanges, at usually a fraction of the costs. 

Growing Returns through Crypto Trading

Cryptocurrencies are not subject to uncertainties created by central government banks. As the market is much smaller compared to forex, an amount invested in the crypto market will have a much larger impact compared to forex. 

A $256 B investment will theoretically lead to the doubling of every cryptocurrency, being equal to the crypto market size. However, the same amount is a mere 4% in terms of forex market cap. The phenomenon came to light with Bitcoin’s 17% jump after influential Tesla CEO Elon Musk invested $1.5 Billion. It is thus much more volatile, capable of scaling remarkable highs and lows within a day. 

White Label Crypto Exchanges 

A frontrunner in Blockchain development, HashCash has lent its native White Label Bitcoin and Cryptocurrency Exchange platform to businesses and firms all across the world. The services have been implemented across Australia, Bangkok, Europe, Singapore, the UAE, and more.

The White Label Crypto Exchange platform supports most of the trending cryptocurrencies throughout the world. Looking for additional options? The software also features options for placing additional aggregators. In fact, PayBito- a digital asset exchange run by HashCash, revealed plans of listing five new altcoins by 2021. The listing process is finalized after shortlisting the best performers among hundreds of coin applications each year received by the crypto exchange.

HashCash: Your #1 Choice as Cryptocurrency Exchange Development Company  

The HashCash white label crypto exchange platform is a comprehensive all-in-one solution for all things associated with cryptocurrency exchange with state-of-the-art features and high-tech security that facilitate instantaneous transactions at the lowest market prices. 

Conceived and developed by a team of experts from diverse sectors such as blockchain adoption, crypto trading, banking, and finance securities- HashCash succeeds in delivering products that serve as industry benchmarks in different sectors- including logistics and supply chain, healthcare, forex, AI, and many more. 

To users, the White Label Exchange offers:

  1. Exchange software platform for multi-currency, multi-signature, high-frequency trading of cryptocurrencies.
  2. Support compatibility for all major fiat denominations, including US Dollar and Euro.
  3. High-security comparable to banks- with 3 point architecture and 256-bit Database Encryption. 
  4. Multisignature wallet options including cold and hot wallets.
  5. Customization options with add/remove cryptocurrency feature.
  6. SegWit, BIP-32, and Firebase protocol features.
  7. Customizable matching engine.
  8. Smartphone and desktop compatibility- available in Android, iOS, and Web Versions.
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