Unless you have been living under a rock for the past few years, you will definitely have heard of bitcoin, cryptocurrency or blockchains. Opening a bitcoin exchange might be a very profitable business, however, you will need to have traffic to your platform. Your profit and the traffic and transaction that you have on your platform is directly proportional to each other. The more traffic and transactions you have on your bitcoin exchange the higher the amount of profit you can earn, and if your traffic and transaction fall then so will your profit.
So this article is to help you open your own bitcoin exchange platform. While most successful bitcoin exchange owners will have their own take on the perfect way to open a bitcoin exchange, we have compiled a list of six steps that you need to follow as you open your own bitcoin exchange.
These are: deciding where you want to start your business, sort out all the legal tendencies such as the country’s regulations and compliances, partnering with a bank, acquiring a bitcoin exchange script and establishing a transaction history, implementing the best security and a great customer support. To find out more about what each step entail, continue reading.
First of all, you will need to decide on the scope of your bitcoin exchange. Do you wish to operate globally or be confined to a specific region or country? Depending upon the answer for the above question, you will need to gain the proper license as well as any government approvals. There are a ton of variations in the laws across different regions and countries. It would be prudent to consult a legal expert for further details.
Secondly, you will have to sort out all the legal tendencies from the government. Most governments require you to adhere to the KYC (Know Your Customer) formalities. You will need to verify every account that is opened on your bitcoin exchange platform with a government-issued ID card. While you may feel that this is an unneeded procedure, the main purpose of the KYC is to ensure that there is no money laundering occurring on your exchange platform.
Also read, How To Start A Cryptocurrency Exchange
Third, you need to partner with a Bank or a payment provider to process all payments occurring on your bitcoin exchange platform. Your best bet is to choose a trustworthy bank with a plethora of online facilities. This is especially true if you are planning to open your bitcoin exchange platform in developing and underdeveloped countries. Usually, transactions take up to two days for settlement, so if you partner with a bank that provides faster settlement, your customers will find this feature great and may convert to a regular customer due to this.
Now, you will need to acquire a bitcoin exchange script. There are numerous ways that you can go about to achieve this. You can hire a team of blockchain experts to create the code from scratch, or purchase a white label bitcoin exchange script on the market. Further, you will need to create liquidity on your exchange platform. Most customers will feel more secure if they see a full order book and trading activity. This is the reason why you need to kick-start your liquidity.
Another important step that you need to consider is the security of your bitcoin exchange. You will need to ensure that all transactions are secure. Not only your customers but also your funds should always be secure to the highest degree possible. You can look at the growing list of bitcoin exchanges that are in the graveyard due to hacking.
Now, lastly, to increase as well as maintain your customer base, the most important aspect is to establish great customer support channels. Whether it be via email, chatting or call support, you will need to provide it all if you plan to succeed as a bitcoin exchange owner. You will further need staff to approve all the KYC process that you need to do, as well as answer customer complaints and information, processing the deposit and withdrawal of fiat currency. Prompt and precise customer support is one of the main ways to build your brand and brand image.
So there you have it, the six steps that you need to follow as your open your own bitcoin exchange platform.