How to Run your own Cryptocurrency Exchange in 2021 πŸš€

  • March 03, 2021
  • MichaΕ‚ MiroΕ„czuk

Introduction πŸ’¬

Along with the growing interest πŸ”₯ in cryptocurrencies and the world of DeFi (decentralized finance), it is not difficult to notice an upward trend πŸ“ˆ in the formation of cryptocurrency exchanges, incl. in order to release your own cryptocurrency. In the blockchain world 🌐, we can recognize two types of exchanges - centralized and decentralized.

  • Centralized exchange - in the most popular understanding of the exchange, we mean a centralized exchange where users can exchange cryptocurrencies β‚Ώ and FIAT πŸ’² currencies through an intermediary. Apart from creating a place for exchanging, selling and buying cryptocurrencies between users, exchanges also fulfill the functions of a bridge connecting various blockchain networks. Examples of a centralized exchange can be Binance and Coinbase.
  • Decentralized exchange (DEX) - managed using smart contracts. The main characteristic of decentralized exchanges is their independence, autonomy and no lack of central authority πŸ’ͺ🀯 which builds greater trust from the cryptocurrency community πŸ§‘πŸ‘±πŸ‘©πŸ§”πŸ‘¨β€πŸ¦°. It is not hard to see that these days they play a key role and cannot be ignored.

In the article below, I will try to explain what factors you need to take into account when launching your own cryptocurrency exchange platform and discuss the listing of your own custom cryptocurrency / tokens.

Let's start! πŸš€πŸš€πŸš€


Centralized exchange aspects? πŸ€”

When creating an exchange, you need to pay attention to various aspects and they occur on various levels. These include matters related to law and regulations, software architecture, business model or application design for the end user.


Core, Trade engine βš™οΈβš™οΈβš™οΈ

The basic and obvious issue will be to prepare the entire core of the exchange platform. The part that is responsible for carrying out transactions, changing and counting balances. Its task is to carry out operations such as saving user requests in the Order Book, history of exchanges and ensuring communication between payment gateways. It is the logic of the entire cryptocurrency exchange.

Multi Cryptocurrencies Support πŸ“Œ, Your Custom Token ✨

Our exchange should be adapted to many types of cryptocurrencies / tokens. It is difficult because the stock exchange must be in constant communication with each blockchain from selected cryptocurrencies in order to provide real-time operations. Below is a list of the most popular blockchains and their most popular cryptocurrencies.

  • Bitcoin Blockchain Network - Cryptocurrency: Bitcoin
  • Ethereum Blockchain Network - Cryptocurrencies: ETH, Tether, AAVE, BAT
  • Binance Smart Chain Blockchain Network - Cryptocurrencies: BNB, CAKE
  • There is so much more...

The cryptocurrency exchange acting as an intermediary in the interchangeability between blockchains can attract potential investors who want to exchange cryptocurrencies from other blockchain networks.

Custom token ✨

Nothing prevents your own cryptocurrency / token from being listed on your exchange. It is best if it meets the standards of the most popular cryptocurrencies, for example standards such as ERC20, BEP20. To find out more, we invite you to a private consultation. You can contact me via the contact form or by email hire@blocksism.com

Security πŸ›‘οΈπŸ›‘οΈπŸ›‘οΈ

Safety is the most important aspect of the entire machine. The stock exchange deals with real money πŸ’Έ and cryptocurrencies that have value, which is why they are a great morsel for anonymous hackers 😈. It should be remembered that the exchange has all private keys, so the security of users' funds depends on the level of security. Some of the large exchanges have security funds stored on cold wallets to cover users' losses in the event of a hack.

KYC/AML verifications πŸ”’

Persons responsible for financial market regulations have introduced measures aimed at counteracting unfair practices. To make this possible, the Know Your Customer procedure was introduced. KYC enables the verification of users' personal data on the cryptocurrency market. This procedure requires basic data and the presentation of an identity document. Depending on the location in which the exchange is registered, it will most likely have to support KYC and AML (Anti Money Laundering) mechanisms, which is a set of procedures to counteract money laundering. Fortunately, there are many ready-made solutions KYCAID, thanks to which the exchange is able to quickly and at a low price meet the requirements of KYC and AML.

User Interface πŸ‘ˆπŸ‘ˆπŸ‘ˆ

The most important thing is to go out to the user with a friendly and easy-to-learn interface, because it is users who give meaning to exchanges. By introducing great trading experience, you will be able to attract and maintain user activity. It is worth considering the options for implementing a handy mobile application πŸ“± and adapting the website to various devices.


Must have components:

  • User registration and login
  • Depositing, withdrawing funds (fiat money, cryptocurrencies) πŸ”„
  • Real-time Tranding View πŸ“ˆπŸ“‰
  • Order Book πŸ“–
  • Transaction history, balance sheets and statistics 🧾
  • Simple interface to KYC mechanism πŸ“‡

The implementation of two-factor authentication will reduce the security problem of user authentication to the minimum. It is worth providing the cryptocurrency exchange with a simple one-click wallet generator πŸ‘› and referral program to attract new users.

Admin Panel πŸ‘·

The administrator should have access to the most necessary things such as transactions, user overview, access to larger deposits and withdrawals and other activities. The panel must allow you to create any cryptocurrency pairs and should be able to enter your own custom token.




Decentralized exchange πŸ”₯

As previously mentioned, a decentralized exchange is based only on smart contracts. It is much less complicated than a centralized exchange and easier to implement, which translates into a reduction in time even in the case of releasing your own token on the exchange. Users are not forced to unnecessary registration, confirmation of identity and, what's more, they do not have to worry about the security of the exchange. Thanks to smart contracts, the exchange does not rely on a third-party service to hold the customer's funds and the exchange takes place in the peer-to-peer model



Interested? πŸ€”

Are you interested in cryptocurrency exchange development or an application that will allow you to sell your tokens? Contact me via the contact form or email hire@blocksism.com