The crypto industry has taken a big leap in terms of mainstream acceptance and adoption in 2020. This year, owing to the pandemic situation, most industries have suffered a great setback, plunging the world into a global economic crisis. While the traditional financial markets crashed failing to keep up with the changing norms of the worldwide viral outbreak, the crypto industry showed remarkable resilience throughout the crisis period. Except for the initial and brief setback as a domino effect of the shares and equity market crash, the crypto activities have been flourishing across geographies.
While it is true that the world had been inching towards crypto adoption over the last few years, the pace has significantly accelerated in 2020. Digital assets trading activities across exchanges have increased, which is evident from volume surges on leading platforms like Binance, PayBito, CoinBase, etc. More people are using crypto for utility and retail purposes, and even crypto donations have become a trend. It is fair to say the cryptocurrency industry is booming, creating the perfect premise for new ventures within the domain.
So to answer the question, is this a good time to start a cryptocurrency exchange? Well, your timing couldn’t have been better.
Great Time to Launch a Cryptocurrency Exchange
According to CoinMarketCap, there are more than 500 exchanges, out of which around 259 are tracked by CMC. The number keeps changing as many are still in their start-up phase. There are around 18, 998 active markets for crypto trade. Given the market data, one might think why launch a new exchange amid the availability of hundreds of them? The reason for that we have stated below:
The regulatory compliances surrounding cryptocurrency is still a very grey area, except for countries like South Korea, Japan, and Malta. However, with the growing interest in digital assets and the central banks pushing for CBDCs (Central Bank Digital Currencies), most governments are working on stabilizing the regulatory field. Once that happens across geographies, a shift of interest in the market is predictable, with the largest exchanges like NASDAQ, NYSE, LSE, BSE, etc. will try to get into the crypto domain by acquiring the leading trading platforms. In that context, if you start an exchange today, there will be a time frame of 1 to 2 years, within which you can make your venture successful enough to become a target for acquisition by the large exchanges.
The cryptocurrency exchange market is fiercely competitive, and continues to grow, as entrepreneurs and enterprises line up to start their venture. But since this is the booming phase, you can make well of the competition by becoming part of the industry. It will help you exchange grow in the present flourishing environment. It is also a great time to get connected with the biggest players within the domain through your little venture. At the moment many small exchanges with good revenue and local market hold are getting acquired by the bigger trading platforms. It can give you a big marketing boost through brand value which will help in generating a good profit margin as well.
Trader Traffic Surge
Common traders are becoming increasingly inquisitive about crypto assets, and they are eager to trade on exchanges just like they do with equity, shares and other asset classes. If you open an exchange now, there will a guaranteed surge of trader traffic due to the growing interest in crypto trading across geographies.
Blockchain being the underlying technology in cryptocurrency and its disruption across industries is another reason to turn your thoughts of starting an exchange into a reality. With DLT advancement, crypto’s mainstream adoption is bound to get an impetus as a fiat alternative, which will have a positive effect on the exchanges as well.
Starting a Cryptocurrency Exchange
Now, that we have placed the argument for starting an exchange, here’s following up with the how. There are multiple ways that you can start an exchange
- Firstly, you can hire a crypto exchange development company to build your exchange from scratch
- Secondly, you can get a white label cryptocurrency exchange software to launch a new exchange
- Thirdly, you can become a franchise owner of a global exchange
The smarter way to start an exchange is by getting white label crypto exchange software. White label software gives you easy access to a tried and tested infrastructure, mirroring which your exchange will be developed and launched. You will be able to leverage the advanced and scalable features of the white label exchange, not to mention significantly lower the development cost and time. Once the foundational infrastructure is formed, you can customize the platform creating its brand identity separate from the white label exchange. It is the fastest, safest, and most cost-effective way a cryptocurrency exchange.
On a concluding note, every innovation takes its own sweet time to impact general lives, replace the old and reign on top. The timing is very important, and it is always the early adopters who gain the most in such times of transitions. If you are interested in cryptocurrency and have a business plan in mind, then the time to make your move is now.