Even if you aren’t the most tech-savvy person in the room, chances are you’ll understand how cryptocurrency works and is traded. What started with Bitcoin has escalated to Ethereum, Litecoin, and Stablecoins, and so much more – all of which can today be used just like Dollar or Euro.
While Blockchain is undoubtedly one of the path-breaking technologies to emerge from the last decade, cryptocurrencies aren’t exclusive – everybody can use them and trade them. Crypto transactions are made with a cryptocurrency wallet.
While the fiat money is still on top, and many firmly believe that they aren’t disappearing any time soon, there have been some clear indications that suggest otherwise. With cryptocurrency slowly moving into other domains, most of which are legacy, it is surely, albeit slowly, likely to overhaul the entire financial system. It may or may not take place of fiat money, but it will only increase in relevance and popularity.
Even today, there are numerous crypto exchanges taking place. So much so that crypto exchange platforms are the talk of the town – everybody’s interested in knowing the types of cryptocurrency exchanges, cost of making a cryptocurrency exchange, DEX development cost, and basically everything related to crypto exchanges.
That is precisely what we’ll be covering in this article. By the time you reach the end, you’ll have a lot more clarity on what is a crypto exchange platform, things to consider while developing one, and the costs that go into developing it.
What is a cryptocurrency exchange platform?
Simply put, it is a place where crypto assets can be traded and tokens can be listed. To begin with, an ideal crypto exchange platform should have the following:
– Engaging UI, simplified UX
– Safe and secure admin panel
– Investor profile panel
– Trade matching engine
– Type of payment gateway Integration solutions
– KYC/AML solutions
– Creation of accounts
– Request for money deposit
– Requests to send money
– Management of bank accounts
Further, there’s a backend portal that allows users to modify their information. It should also be kept in mind that the platform functions smoothly on all OS and browsers.
The cost for this process depends entirely on the features you’re wanting to go for. If you’re looking for a more sophisticated platform, you might have to incur extra costs. Some of the special features might include:
– Margin trading
– Security token exchange
– IEO integrated module
– Market Orders
– Trading Bot
– Encrypted E-mail identity
– XSS clean
– Tracking based on IP
With most of the essential features laid out, you now have a clearer idea of what features must be there in a crypto exchange platform. Now, if you’re wondering…
Costs for making a Crypto Exchange
Before you know the costs, you should be aware of the types of crypto exchanges that exist. Based on their functioning, there are three kinds of crypto exchanges:
Centralized: consists of a middleman to perform the transactions to buy and sell digital assets.
Decentralized: perform anonymous transactions without a middleman.
Hybrid: a mixture of both centralized and decentralized exchanges
Before you begin with the crypto exchange development process, understand the above-mentioned types in detail, and choose the desired type of exchange you are willing to launch. Depending on the type you choose, the prices are likely to vary – the DEX development cost will be different than that of making a centralized, and so on.
Further, you should know that on the basis of ways of development, there are further two ways you can enter the industry. They can be:
– Readymade or white-label crypto trading platform
– Crypto exchange development from scratch.
A White label Crypto Exchange is a readily built trading platform that you can buy and alter (albeit only to a limit) as per your requirements. You can add or remove functionalities and customize it completely. There are White label software and script which are available that can help you develop your own cryptocurrency exchange instantly!
The overall advantage here is that you can save up on the cost of making a cryptocurrency exchange, or even DEX development costs. However, if you need to tweak the features beyond a limit, you might find yourself in a pickle. This is a good approach if your team lacks technical expertise and you’re just starting out with planning the cost of making a crypto exchange platform.
On the other hand, starting a cryptocurrency exchange from scratch is also possible. You can layout your features and futuristic functionalities in your crypto trading platform.
However, the time for Cryptocurrency Exchange Development usually takes around 4-6 months to get developed based on your unique requirements and advanced functionalities involved in it.
Therefore, know which one you are going to move with. If in case you have any urgent requirements, it is better to go with buying a White label Crypto Exchange in the market.
Figure out the time and budget constraints
To precisely know the cost of making a cryptocurrency exchange, It is crucial to know the exact duration within which you need your crypto trading software to be built. Yes, it is important since it determines your cost of building a cryptocurrency exchange.
For instance, if you require your platform to be built within a week, the cost of making a cryptocurrency exchange will comparatively be more than, say, if you have a month’s deadline.
Once you have the duration in place, the next thing is to showcase your maximum budget. Remember, the budget should include future plans as well! For instance, if your exchange encounters any issues, you should have a backup amount to manage them.
In addition to both these constraints, you need to spend your funds on general factors such as:
– Providing wages to the employee
– Legal compliance for your crypto exchange
– Due diligence.
And more. Hence, ensure you have sufficient funds to manage the time effectively for creating a crypto exchange.
Know the primary components/features of cryptocurrency exchange
Before you can truly estimate the cost of making a cryptocurrency exchange platform, you first need to draft the functionalities you need.
The DEX development cost or the cost of making any crypto exchange depends directly on the features you require in the cryptocurrency exchange platform.
Creating a user-friendly account system is an important thing in a cryptocurrency exchange development. The user accounts should be designed in a manner that, effectively identifies and manages the customers, and enables them to deposit and withdraw virtual currencies in the platform.
Secondly, the Cryptocurrency Exchange Aggregator allows users to set up a Bitcoin Exchange on their websites. Moreover, with this tool users can create their own coins and tokens which processes huge amounts of transactions per second. Hence, this is considered to be an expensive feature in a crypto trading platform.
Next comes the Trading Kernel which is the core part of an exchange software. The primary motto of this is to create an order book, regulate the transactions, and update the balances.
Undoubtedly, having an intuitive interface is crucial. Users should easily navigate within the platform and perform instant trading.
As a proprietor, you should be able to manage your dashboard effectively. Hence, it is important to integrate features such as pending transactions management, investor management, etc in a hassle-free manner.
On the other hand, your users should also enjoy great features in your exchange platform. In this case, you can integrate entities such as live statistics, history of transactions, buy and receive cryptocurrencies instantly, view balance, etc.
Next comes the crypto wallet integration. Some users will prefer Hot wallets for instant transactions while some prefer cold storage for a safer transaction. Therefore, decide whether you are going to integrate both the storage for the wallet.
Finally, you should implement security protocols such as DDoS, HTTP Authentication, Data Encryption, Jail Login, CSRF Protection, etc to get rid of being hacked.
Additionally, the cost of making a cryptocurrency exchange must include:
– Ease & Instant registration
– 24*7 Customer Support
– Statistical monitoring
With that, we hope you find yourself in a more comfortable situation while gauging the cost of making a cryptocurrency exchange or DEX development costs. You should also find yourself equipped to pick the type of crypto exchange you want to develop – whether you want to incur DEX development costs or costs of making a cryptocurrency exchange that is centralized?
In the end, it all boils down to your needs and requirements, but there are certain key features that shouldn’t be missed out on while considering the cost of making a cryptocurrency exchange.
We’ve covered all such required features – if you feel we’ve missed anything, or wish to add your inputs on the cost of making a cryptocurrency exchange, do drop us a comment below!