Cryptocurrency (Bitcoin and Altcoin) Trading Exchange Website Script
The business of exchanging Bitcoins, Ethereum, Litecoins, and other cryptocurrencies and altcoins are developing rapidly not that from year to year, but even every quarter. Investors, traders, they are all sitting at the monitors watching charts of the exchange rate with great expectations. But how to run the cryptocurrency exchange itself? Is it worth considering the white-label cryptocurrency exchange, or is it better to invest and buy a cryptocurrency/bitcoin exchange trading script? What you need to pay attention when buying and downloading, read on in our article.
A characteristic feature of a small project is the architecture all in one. It can be cheaper, however, and bandwidth, the load is also not so hot. Needless to say and think, about trading volumes exceeding several thousand.
At the moment, the largest number of exchanges on the market is the medium-level projects. To create and run such an exchange you should use a modular system with isolated components. If you have several high-end system administrators in the team, then you will be able to launch an effective platform with decent daily volumes.
Large or enterprise cryptocurrency exchanges will not work with the above architecture. But what then to do? Distributed isolated modular system with load balancing and super powerful server (a la, m5.24xlarge) will help you. The components of the cryptocurrency exchange software have been described in our previous articles. This is a graphical user interface, wallets, trading engine, administrative system, and database. Synchronous operation is the key to success at the start. Each of these components for the medium project must be hosted on a stand-alone server. Protection levels vary from component to component. Technical requirements for the server are also different.
Know your customer require exchanges and payment systems. What is included in the minimum KIT for KYC? For most countries, it is sufficient to provide user data, their identification with ID cards, international passports, and driver's licenses. The next level of identification involves the possession of information about the user place of residence. Bank statement, utility bill, or mobile operator bill also solve this. KYC is important for launching ICO.
AML or anti-money laundering. Shortly, in order to protect yourself, you are required to provide reports on financial transactions passing through your exchange to higher authorities, the Government. It is important to remember that this is all necessary only for exchanges that work with Fiat money like the dollar, euro and other regulated. If your cryptocurrency exchange presents cryptocurrency trading pairs to cryptocurrency, then it is not necessary to implement these modules. However, once you decide to run Fiat money, get ready.
Liquidity is the most important element of building cryptocurrency exchange platform and script. Without sufficient liquidity, your exchange will not be listed on Coinmarketcap, users will be unhappy, and as a result the outflow of customers. Misinformation has always existed, but there are only 2 options for generating liquidity.
Local market makers. Generate orders based on algorithms, current exchange rate, and the general market situation. Market makers work on behalf of platform owners and their wallets. According to 2017 data, each major exchange has local market makers.
External liquidity. If the first option does not suit you, there is much more interesting – obtaining external liquidity, for example from Kraken. What happens in this case? Exchanges are synchronized with each other. As soon as the order appears on Kraken, it immediately appears on your exchange and vice versa. It is difficult to say which of these two options to choose. Pros and cons are in each of them. Unity and harmony in liquidity can be achieved only by combining both options in the platform.
Regarding cryptocurrencies, you can always open Coinmarketcap to see which coins are gaining popularity and which ones are losing value. Capitalization is another important point. Definitely worth using Bitcoin and Ethereum. Add Litecoin to them and here is the minimum acceptable set. If you created your own ERC20 token, maybe it is worth adding it too. To some extent, it also depends on the target country. For example, in Turkey a long time popular Monero. Your supported list of coins might be an advantage for you which your marketing experts suggest using. The same as in ICO marketing.
Managing trading pairs is also important, but not as important as reports and transaction lists. Smart filters based on user preferences, market conditions. Communication with users is also better to implement through the administrative part. The alternative can serve as Zendesk.
The market is packed with different options and scripts, each with its own characteristics and shortcomings.
Free and open-source scripts. Perhaps the most delicious decision. Free scripts that everyone can easily download and install to start the cryptocurrency exchange. Is it worth to download? Definitely, yes. At least you will understand the architecture of the exchange and its components. However, in such scripts often have holes for developers to be able to pull the money a little bit. In that case, you hire a team of experts to audit and then restructure and refactor your code. I think it is needless to say that such scripts will not withstand decent loads.
Cheap scripts. If you have a little knowledge in the development, for example, on WordPress, it's easy to you to download the ready-made open-source script, make small changes to CSS and sell it under your name. These are the solutions you will find on the Internet. At its core, they are virtually indistinguishable from the previous paragraph.
White-label exchange scripts. Such scripts already have ready-made functionality that you can deploy to the server and run. Ideal for starting your bitcoin exchange business, but often does not meet the requirements of companies with slightly higher expectations.
Custom exchange. Suitable for exchanges involving unique features, its own vision or refinement. Suitable for large, high-load projects.
So, we have considered the most important stages when buying or downloading the cryptocurrency and bitcoin exchange script. What functionality to choose? At least you know what to pay attention to. If you still have questions or want to try the Merehead script, write to us.