The exchange business
In 2021 alone, Binance’s revenue was about $20 Billion dollars. Coinbase’s was 7.4 billion. Those are Billions with a capital B!
Seeing these numbers, there’s no doubt at this point that running a crypto platform is big business with enormous opportunities for entrepreneurs.
Not only that but also nowadays you don’t really need a huge investment to start a crypto exchange of your own, as many would think. These have become increasingly more accessible businesses, thanks to the development of powerful crypto white label tools and services that facilitate all steps in setting up a functional and simple customizable exchange.
This new opportunity has caught the attention of a large group of people interested in giving it a try in this ever-growing industry. Still, many aren’t fully aware of the kinds of business opportunities an exchange platform is capable of and delay starting anything resulting in wasted potential.
That’s why this article is going to share the 10 main benefits of building and starting your own exchange so that they can see the many online business prospects of running a crypto platform.
1. Trading fees revenue
I guess you were expecting this one. Since the dawn of online trading, trading fees have been the primary revenue source for exchanges all around the world.
Much before cryptos even existed, traditional exchanges and brokers were already profiting off small commissions for each transaction, a model that persisted through time thanks to its simplicity and effectiveness.
Crypto exchanges have proven to be no exception to the rule, with every major trading platform charging at least a minuscule fee. Enjoy the pleasure of simple things!
2. Market making and liquidity providing
This is one of those underrated features that not many talk about, even though it has the biggest potential and can become a major source of daily revenue.
Market making, liquidity, and spread are undoubtedly money-makers if you know how to take advantage of them. It’s not easy, but once you understand how it all works, the only thing you need to start turning an extra profit from your platform trade activity is a trading bot, a spread, and some working funds active on multiple exchanges.
Some exchange systems include an easy broker system that allows you to set up your own prices and apply spreads easily for popular crypto assets and makes for easier profit estimation as well.
3. Coin publicity
If you have a coin project of your own, you surely know how hard it can be to get new investors. In this hyper-competitive world, getting the attention your asset needs can feel impossible at times.
Any coin founder will tell you that having your project listed in one of the big exchanges is nearly impossible, especially if you don’t have a big pocket to offer or a big coin market cap. Undoubtedly, getting started can feel like an impossible challenge when jumping into the business.
Having an exchange of your own solves a lot of these problems, as your investors will have a secure and trustable place to trade your coin. In contrast, you won’t have to invest huge amounts of money in a regular listing and once your active userbase begins buying the coin, it will provide a much-needed boost to your platform’s balance sheet.
4. Ad revenue
It’s not news that we are in the age of digital advertising; everyone has been placing ads everywhere lately, and crypto exchanges aren’t the exception.
Be it a simple banner over your markets list, a pop-up for newcomers, or a gif on the side of the screen, any of these formats will put that good traffic you got to work.
5. Charge for coin listings
Previously we talked about how hard it can be to have your own token listed on a reputable exchange. But, what about being on the other end of the deal?
If your exchange has a decent flow of users, coin teams will probably be interested in having their assets listed on your site, for a reasonable price.
Not only this but having multiple projects listed will attract niche audiences to your exchange, which will probably take a look around and maybe even make some extra trades.
6. Satisfy a necessity
Having a business of your own allows you to provide products and services that others in the same industry don’t. This strategy is called differentiation, and crypto exchange is a perfect financial system to create various services.
For example, you could support fiat currencies that most exchanges overlook, offer exotic trading pairs, or creative ways for your users to earn interest on their assets. The key is to offer something new and useful!
7. Sell other crypto products
Imagine you followed my last advice and grew a small community of your own; Now what?
Well, you can now pitch them new products of your own! And because they already trust another of your products (Your crypto exchange), they are more likely to buy into or at least pay attention to your new stuff.
8. Put your money to work
Investing your extra money can seem like a troublesome choice, as nowadays the sheer amount of options can be paralyzing. With so many ways of doing this, I don’t blame you if you feel lost or confused.
Luckily, if you have a crypto exchange, this can be a no-thinker; Reinvesting your money into things like liquidity providing or setting up an OTC fund is much easier than what it may look like, and can give great returns if well planned.
9. Lending or other financial services
Many people have pointed out Bitcoin as kind of a saving angel, as it was created just one year after the infamous 2008 global crisis, in which lots of people lost their entire life savings, accompanied by their trust in banks.
Nowadays, 15 years after, cryptocurrencies keep filling the holes banks don’t, offering the possibility of accessing banking services like loans and saving accounts to people who haven’t been able to before, due to their inability to access these via traditional ways.
10. Grow an audience
Finally, if you have been on the internet for some time, you probably know just how important audiences are. It is even more important when running a crypto exchange as it will have multiplying effects on all of the benefits mentioned above.
These are the people that will be watching your brand and awaiting new stuff, so it wouldn’t be a bad idea to build an audience with your crypto exchange. Who knows where it will take you?
In addition to this, you could also bring a pre-existing audience to your brand new crypto exchange, in order to offer them new products from a trustable source they already know. Getting more audience can be done through referrals and marketing campaigns right inside your platform.
As you were able to see, building your own exchange has a pretty decent list of benefits, lots of which most have never thought about before because they think it is far too late or far too difficult of an undertaking. But exchanges are actually much more easy and more versatile business systems than what they might look like at first glance and that is all thanks to white label tools like HollaEx that make it that much easier to get started!
From token projects, market making, and crypto products marketplaces, the possibilities are actually endless when you run your own crypto exchange, and these 10 were just a few examples of what can be done; Your imagination is the limit!
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