Today, many people have the idea to open their own crypto business. This is associated with many risks, so you must think through everything to the smallest detail. On the site https://cryptocurrencylicense.co, you will find complete information on getting a license in the shortest possible time.
What is a cryptocurrency exchange, and how can such a platform be profitable?
Simply put, a cryptocurrency exchange is an online platform that allows you to buy, sell and exchange cryptocurrencies and fiat currencies. The main principles of such products are increased security, transparency, and transaction speed. The more reliable, faster, and more convenient your platform is, the more audience it will captivate and retain. Which, accordingly, leads to an increase in income.
Thus, even if you want to avoid becoming the second Binance, you still have every chance to succeed in your cryptocurrency exchange business. How? This post will help you find out.
To create a good crypto exchange that generates income, you must consider the following aspects.
How to increase the client base?
Your business will only be successful if you can attract many users. It can be challenging to do this, especially in a competitive environment, but it is more than possible. First, you need to establish a social media presence. Here you can publish exciting facts from the world of cryptocurrencies and data about your company. The larger your audience, the better.
You also need to attract good marketers who will help you build an advertising strategy.
You can also involve an SEO specialist in the development of the site, which will allow you to make your product more attractive to search engines.
The more investors, the better
It is imperative that your organization is well-capitalized. The problem is that the value of cryptocurrencies fluctuates dramatically. With the onset of the crypto winter, we have seen small-cap organizations fail because they have lost the ability to pay their clients the promised money. You need to have a kind of airbag to prevent this from happening. The more investors you attract, the easier it will be for you to maintain financial stability.
You can manage cryptocurrency and real money using electronic payment systems that allow you to carry out several actions, namely cashing out and transferring money, replenishing finances on the platform, withdrawing them, or paying for various services and purchases. Also, on the service, you can create a system of debit cards, with which you can withdraw crypto assets in regular stores; it will also be available and make purchases using cryptocurrency.
The possible options for cashing in payment systems are different from each other. For example, you need to transfer a certain amount of electronic money to the specified address, after which it will be credited to the fiat balance. The platform can also work with other services; you can link a cryptocurrency account to it.
As we already know, you can buy, sell or cash out electronic money in the application or on the website of crypto exchanges. At the time of withdrawal of the asset, the first thing to do is to accrue to a third-party service and only then to the direct user. The commission of each operation for each time reaches at most 4-5 %, but this also depends on the level of the platform.
The withdrawal of cryptocurrency through the exchange to fiat is possible only after passing the KYC procedure (personal identification). You must send a photo of your passport or other documents. Then replenish the balance, exchange tokens for the desired currency (dollars, euros), and cash out using one of the supported methods.
Through the exchanger, cashing out is faster than through the exchange because verification is not required here. But the common drawback of the two services is the centralized platforms that store keys and user data on servers, which creates the risk of hacker attacks. There is a chance to run into scammers or phishing sites that copy an actual site’s interface.
You can also find hybrid crypto exchanges that combine the properties of centralized and decentralized exchanges with improving the quality of services. For example, third parties may operate such businesses to give users more control over their funds. Orders and transactions are encrypted, time-stamped, and stored on the blockchain, while order approvals are performed off-chain on a third-party node.
Consider the main ways to cash out cryptocurrencies:
- Fiat money. A cash transaction is only available when meeting the person directly. Be careful; many scammers exchange fiat for fake cryptocurrency or, instead, for a rigged transfer.
- Crypto wallet. While on some withdrawal platforms, such as blockchain, registration with identity verification is required, others do not. Moreover, the commission is usually higher on official services than on less popular ones. Through a crypto wallet, it is possible to monitor information about transactions and hash rate networks (blockchain communication). Cashing out is quite simple: indicate the available amount and the card to which the money is withdrawn.
- Using a telegram bot. Often the messenger is supported by the crypto wallet infrastructure. Switching to the telegram bot only from official links is essential to prevent losing money. With the help of a bot, cash is withdrawn much faster and without third-party platforms.
People always have different options, so it is essential to provide users of your crypto exchange with as many withdrawal options as possible.
Many crypto organizations are subject to hacker attacks, which is why they lose a lot of money and, most importantly, users’ trust. To prevent this from happening, you need to take care of the security level of your software. Using encryption to store customer personal data and transaction information will be good.
You also need to check the reputation of all your employees carefully. They should not have had legal problems and bad references from a previous job.
Arbitrage allows users to compare current rates of different cryptocurrencies and earn on successful exchanges on other platforms. Enabling your clients to trade cryptocurrencies on your exchange will increase the popularity of your platform, as this type of trading is quite common today.
Obtaining a crypto license
After you have thought through all aspects of your company’s work to the smallest detail, you can start obtaining a crypto license. With this, you can work legally and attract many clients and investors.
Getting a work permit involves the following main steps:
- Choice of jurisdiction;
- Registration of the organization;
- Opening a bank account and paying fees;
- Collection of necessary documents;
- Verification of compliance with the requirements of state authorities;
Please seek the help of qualified lawyers. They will check the correctness of filling out the documents, help to complete them, and tell you how to improve your company so that it meets the requirements of government agencies.
In the end
Creating a crypto business comes with huge risks that you need to calculate to the smallest detail. The better you think through your business model, the more likely it is that even a tiny startup can grow into a large corporation that will bring huge profits to its owner. It will be challenging for you to solve all the issues alone. Our specialists are ready to help you solve all licensing issues. You can leave it to the professionals and do more important things yourself.