Development within the company
You can create software for a centralized cryptocurrency exchange inside the company. To do this, you need to find good specialists, buy equipment, rent (allocate) a room and organize the development process. All this is very burdensome and far from always justified, especially if speed and quality assurance are important.
What to look for when developing
Trading engine
This is the basis of any cryptocurrency exchange. The trading engine collects all the information, elements and functions of the site into one mechanism in order to:
- match orders to find counterparties;
- initialize smart asset swap contracts;
- make residual calculation.
To create a trading engine, you need immersed programming skills and an understanding of blockchain technologies, that is, creating it is long and expensive. But here you can save if you use open source software, which is spread on GeekHub. True, not the fact that this software will be of high quality and reliable.
Atomic swaps
By atomic swaps is meant a kind of peer-to-peer exchange of virtual assets without the participation of third parties, including exchangers. Usually, with their help, people exchange one cryptocurrency for another, but there may be options with the exchange of data, certificates and other.
An example of an atomic swap for exchanging bitcoins for air
By their nature, these are smart contracts that
work with two blockchains and use the Lightning Network protocol for exchange. Within such contracts, there is either a parallel simultaneous exchange algorithm or an algorithm using bilateral escrow.
Advantages of atomic swaps:
- Price. Atomic swaps use the Lightning Network, so the transaction fees for such operations are very low. For example, one dollar is enough for hundreds of bitcoin transactions in the Lightning Network. While the commission for a normal bitcoin transaction is 25 cents (February 12, 2019).
- Decentralization. Atomic operations are initiated by direct participants in the transaction, and no one can intervene or cancel them.
- Speed. The exchange operation is carried out almost instantly, although this does not change the fact that you need to wait for confirmation of the transaction to close the contract.
- Lightness. The fewer participants, the easier the transaction.
Order book
Decentralized platforms, as a rule, do not like to use standard order books, instead they use Distributed hash table (DHT). As in the case of a decentralized blockchain, the information in such order books is encrypted and distributed among the nodes of the ecosystem. Therefore, in order to change or steal it, you need to find and crack most of these nodes.
Features of DHT order books:
- Decentralization. Use a system of independent, physically separated nodes that are controlled by users, and not by some kind of centralized structure (server).
- Scalability. The network works equally efficiently with both a thousand and a million nodes.
- Fault tolerance. The system as a whole will work even if many of its nodes turn off, constantly connect / disconnect or give errors.
User interface
This is how the user sees your exchange. The interface should be user-friendly, fault-tolerant and pleasant in appearance. The user should at a glance understand how to make a trade, what needs to be done and how to access other functions.
Sample DEX user interface elements
When developing a user interface, you need to be guided by such rules:
- Logical and consistent provision of information that will reduce the user's cognitive stress and facilitate familiarity with the system and its use.
- Minimize potential user errors. At the same time it should be possible to quickly roll back all actions back and perform them again.
- All icons and buttons must be standardized, that is, they mean the same thing in different sections and run the same actions (forward, back, cancel, buy, etc.).
- Aesthetics and minimalism.
Payment instruments
This is an optional module, since the
script for decentralized cryptocurrency exchange works directly with users' wallets. However, to increase audience coverage and turnover on the site, you need to think about exchanging virtual assets for fiat money and vice versa. For this, it is necessary to establish partnerships with banks and payment services.
The choice of specific payment services should depend on geography:
- North America: PayPal, 2Checkout, Simplify Commerce, Stripe, WorldPay, SagePay, Amazon Payments.
- Latin America: 2Checkout, PayU Latam, Mercado Pago, Pagseguro, WorldPay.
- European Union: SecurionPay, Skrill, Stripe, Amazon Pay, PayPal.
- Asia: 2Checkout, Paypal, Skrill, WorldPay, Alipay, UnionPay, Tenpay.
- CIS: PayPal, WebMoney, Qiwi, Yandex.Money, Robokassa.
- Africa: MyGate, SagePay, Ingenico, WafaCash, Skrill.
To activate MasterCard, VISA, American Express payment services, you need to contact your local bank and conclude an appropriate agreement with it.
Internal messenger
If the cryptocurrency exchange will support not only
automatic exchange operations (created an application and wait for it to close), but also direct transactions between users, you need to add some kind of communication.
