How to start a cryptocurrency exchange platform?
If this is your constant buzzing question and if you are searching for the best solution, then you have landed at the perfect place.
As per the reports from Skyquest, the cryptocurrency market size is expected to reach 13.19 billion USD by 2032 with a CAGR of 12.5%. Hope these predictions will be a boost for your thirst for creating a cryptocurrency exchange platform in this competitive landscape.
As cryptocurrencies have turned into a potential and unbeatable investment among users, startups are focusing on building a crypto exchange.
Ok, coming back to the question, cryptocurrency exchange can be created in steps with a catchy interface, potential backend & frontend infrastructure, etc. From the ideation process to the deployment stage, we have covered the entire development process in this blog.
But, before that, let’s start with…
Why Start A Cryptocurrency Exchange Platform?
We all know that the crypto exchange market is undeniably competitive yet the need for one is all-time high. Knowing the business benefits of starting a crypto exchange will make a clear route for cryptocurrency exchange development.
Cost-Effective Idea
With the right exchange development method, the exchange platform can be developed within an affordable budget. Modern blockchain technologies and cloud-based solutions make it easier to scale your platform as your user base grows. Hence, starting a cryptocurrency exchange won’t make you take on debts.
Global Level Audience
As cryptocurrencies possess the same value for every country, many users from all over the world are utilizing them as their investment option. So, creating an exchange platform will help startups to gain global users. With the right exchange infrastructure startups can grow exponentially.
Revenue Streams
The crypto exchange platform is flooded with multiple revenue streams that will offer immense profits for startups. Some of the revenue streams of the cryptocurrency exchange platforms are,
- Trading fees
- Deposit/Withdrawal Fees
- Affiliate Marketing
- Listing Fees
- Lending Fees
- Staking Fees
- Subscription Fees, etc.
Through this, startups can earn enough revenue from the platform.
Increased Demand
According to Skyquest data, the number of users has increased from 579.80 million (2023) to 856.70 million (2024). By 2025, it is expected to reach an average of 861 million. This shows that the crypto exchange market will flourish, making this the right time to start a cryptocurrency exchange platform.
Niche Emergence
New trends like DeFi, NFT, Web3, Metaverse, AI, etc. are creating their crypto market space. Focusing on a specific and specialized niche will help you to gain a set of users without much effort. Direct competition from competitors can be avoided and loyal users can be earned.
Crypto Ecosystem Building
As more people enter the cryptocurrency market, the need for trustworthy platforms is also gradually growing. This allows for the development of well-built communities or ecosystems, which helps expand businesses.
Starting a cryptocurrency exchange won’t be a difficult task when you understand the market needs, leverage the latest technology, target a specific audience, etc. There’s no better time to start a cryptocurrency exchange platform.
So, let’s dive into the important query.
How to Start a Cryptocurrency Exchange with 10 Easy Steps?
Let’s dive into the 10 simple steps for starting a cryptocurrency exchange with reliable, user-friendly, and secure trading platforms.
- Market Research
- Roadmap creation
- Choice Of Exchange Type
- Choice Of Development Method
- Obtain License
- Feature Integration
- Development
- Testing
- Deployment
- Updation
Step 1: Market Research
Doing market research will be the initial stage for creating a cryptocurrency exchange without any hassles. Startups can segregate the market research phase by,
Competitor Analysis
Make a complete list of the present competitors and get their marketing strategies. This will help to find the loophole in their trading platform which can be integrated into your platform.
Current Trends
Implementing the latest technologies, and trends will help to gain a massive set of users without much effort. Staying up to date with the trends will ensure the success rate.
User Needs
User needs and requirements change based on their convenience. So, analyzing this before the creation process is essential.
If everything falls into the right place you can proceed to the next step of creating a roadmap for the cryptocurrency exchange development.
Step 2: Roadmap Creation
Frame the roadmap for your cryptocurrency exchange business along with the resources, and tools. Getting guidance from the expert team will help create a full-fledged roadmap.
Location Choice
Even though cryptocurrencies are not restricted to geographical locations, some countries strictly prohibit cryptocurrency exchange creation. In simple terms, it is illegal to start a cryptocurrency exchange platform against government rules & regulations. Top-friendly countries for cryptocurrency exchange platform launches are,
- United States of America (USA)
- Germany
- Japan
- Singapore
- Malta
- South Korea
- El Salvador
- European Union countries
Choose any of these locations or conduct in-depth research to find the right location for creating the cryptocurrency exchange application.
Milestone Creation
After picking the right tools for the exchange creation, creating a milestone for each phase completion is very important. Because it is important to know how long it takes to launch a cryptocurrency exchange for marketing purposes, regular upgradation, etc.
Step 3: Pick The Right Crypto Exchange Type
Deciding the types of cryptocurrency exchange is crucial before starting your cryptocurrency exchange business. As of now, there are three different types of cryptocurrency exchanges in the global digital marketplace. They are,
Centralized Crypto Exchange
Centralized cryptocurrency exchange or CEX is an admin-based platform where users can trade a wide variety of digital currencies in a risk-free manner. There will be an exchange admin within the platform to ensure the transactions.
For every successful transaction, a commission fee is collected by the admin to generate a lucrative revenue easily. Also, user transactions and digital wallet balances will be monitored to ensure security. Some of the types of CEX platforms are,
- Order book Exchange
- Ads-based crypto exchange
- Crypto derivatives exchange
- OTC exchange
- P2P exchange
Decentralized Exchange
Decentralized crypto exchange or DEX is a peer-to-peer exchange platform that functions without the admin or any third party. In this type of cryptocurrency exchange, user privacy is highly protected and users will have full control over their funds.
Even though the platform is decentralized, this type of exchange has strong security systems. You can also create your decentralized exchange with proper consideration and resources.
Hybrid Exchange
A hybrid exchange is a combination of both centralized and decentralized exchanges. This type of exchange includes both the features and security mechanisms of CEX and DEX.
For instance, the Binance exchange platform is a good example of a hybrid exchange that offers various features of CEX and DEX.
These are the major types of exchanges. Select the best type of cryptocurrency exchange that matches your business budget, needs, and requirements.
Step 4: Choose The Development Method
There are three different ways to start a cryptocurrency exchange,
Custom solutions
In general, starting a cryptocurrency exchange from scratch signifies that everything is done from the beginning. This development method requires more time, adequate funds, and resources. Yet, it gives the flexibility to customize your platform according to the business needs.
Hence, this method will be suitable for established entrepreneurs who want to create their own identity. But, if you are a newbie startup, then you can go with another method.
Pick White Label Cryptocurrency Exchange
Adopting ready-made software will help startups launch the cryptocurrency exchange platform effectively. This customizable solution is a pre-built, multi-tested, and quality-assured solution that can be customized easily. It is easy to implement when compared to the custom solutions.
Besides, the white-label cryptocurrency exchange software also gives you access to all the features of an advanced trading platform without having to build it yourself. Also, it is a cost-effective and less time-consuming solution for cryptocurrency exchange development.
Adopting Crypto Exchange Clone
The easiest method to launch a cryptocurrency exchange is by picking the right cryptocurrency exchange clone. Same as the white label solution, the exchange clone script will possess the features, functionalities, and plugins of a business model.
For instance, if you want to integrate the features of Binance Exchange, you can adopt a Binance Clone script that replicates the features, plugins, etc.
With this exchange clone script, one can easily launch an exchange platform within 3 to 7 weeks at an affordable cost. Additionally, they can also be customized and modified based on the business needs. Crypto exchange clone scripts are an ideal choice for newbie startups who want to succeed in the digital space.
No matter which method you choose, every development method has its pros. It’s important to understand them thoroughly before deciding on which one is right for the project.
Step 5: Obtain A Crypto License
The law for digital assets differs in every country, jurisdiction, and region, so it is advisable to examine the rules and regulations. In addition, proper licensing and registration are needed for operating a cryptocurrency exchange website and app in any country.
Country-wise Choice
Crypto trading platforms are operated without significant oversight. However, in the US, digital currency operators must get proper licenses from the government for Money Transmitter businesses. Hence, consult a legal expert in the field before creating a cryptocurrency exchange business in your desired country.
Step 6: Feature Designing
After choosing the method to start a cryptocurrency exchange, the next phase is integrating features into the cryptocurrency exchange platform.
User Dashboard Features
- User Login – Crypto users can log in with their user account with higher security and protection.
- Trading Options – Multiple trading options are provided for users in a decentralized way.
- Real-time market Data – Live data of the price, volume, data, etc are offered in the exchange platform.
- Account Management – Exchange users can track their portfolio, and cryptocurrencies, and also modify their theme.
- IEO Launchpad – Newly released tokens can be bought from the IEO launchpad.
- Customer Support – A 24/7 support system is offered for users to rectify technical or transactional issues.
- Price Alerts – Notifications regarding the cryptocurrency price, values, etc are displayed to alert the user.
- Wallet Support – Cryptocurrency wallets are integrated to secure the user’s cryptocurrencies.
Admin Features
- User Traction – The admin will monitor the active users, registrations, and user engagement within the exchange platform.
- CMS Management – Website content can be optimized and customized by the exchange admin.
- Customizable Fee Structure – The exchange admin can configure the fee structure, percentage, etc.
- Trading Analytics – Real-time user behavior, and traction can be analyzed with this feature.
- Liquidity Management – Liquidity pool management is done by the admin to ensure the availability of the cryptocurrencies.
- Compliance Management – KYC and AML factors are managed through this feature.
- Backup & Restore – The exchange admin can restore the platform and user data to prevent data loss.
- Airdrops – New promotional campaigns can be launched to make the platform more engaging for users.
Security Features
- Jail login – The account will be locked temporarily after multiple login attempts.
- Data encryption – The data of the user and admin dashboard is encrypted to avoid loss.
- Two-factor authentication – A layer of extra security is added by verifying twice.
- SQL injection prevention – Malicious SQL queries are prohibited to safeguard the exchange platform’s data.
- Anti-denial of Service (DoS) – This is to mitigate server overload attacks by hackers for the exchange.
Step 7: Development Phase
After the feature integration process, delve into the development phase of the cryptocurrency exchange platform. Choose the best back-end, and front-end tools for exchange platform creation. You can get help from an experienced cryptocurrency exchange development team to ensure the quality of your exchange.
Step 8: Testing
You can run a beta test, after integrating all the important trading and security features. Through this testing process, technical glitches, errors, bugs, and issues are rectified that are found within the exchange. If unfortunately, your platform faces any issues in testing, you can easily rectify them instantly. Once the beta testing is over, your exchange is ready for the deployment phase.
Step 9: Deployment in the Market
In this phase, you will get your fully functional and ready-to-go live trading platform. After your exchange gets deployed with the help of professionals, you need to market your exchange through promotions. The process of creating your cryptocurrency exchange does not stop with the deployment.
Maintenance has to be done periodically for your platform as some anonymous attackers will look for some security hole to inject threats.
Step 10: Regular Updates
Ensure to conduct a regular auditing process, and quality assurance to check the status of the cryptocurrency exchange platform. User feedback can be bought to enhance the platform that will be more user-friendly.
By following these steps you can successfully start a cryptocurrency exchange platform that overshines others. Creating a cryptocurrency exchange is not a daunting task unless you have a clear marketing plan and enough knowledge about current trends.
Last but not least, you need a potential crypto exchange development company that possesses skilled developers, testers, technicians, etc. One such firm that offers crypto exchange development services at an affordable price estimation is Coinsclone.
Why Choose Coinsclone to Start a Cryptocurrency Exchange?
Coinsclone is a well-established cryptocurrency exchange development company in the digital space that has delivered nearly 250+ projects. Being a leading crypto firm, we excel in providing all sorts of cryptocurrency exchange services, such as white-label cryptocurrency exchange, decentralized exchange script, and more.
Our team develops a cryptocurrency exchange platform that is scalable for futuristic growth. We guide you throughout the crypto project for higher revenue. Don’t just build an exchange rather build an experience!!
Reach out to our business team to get a quotation!!!
