Cryptocurrencies have risen to its fame even in these pandemic crises. Experts address the unexpected, negative scenarios as “Black Swan”. The world is now facing this black swan crisis, and hence the investors are swapping their assets to stable crypto coins. Hence, the experts consider the cryptocurrencies as “Gold-2.0”.
Crypto owners buy or sell their cryptocurrencies in the exchange platforms. As of now, three categories of crypto exchanges are more popular. They have centralized, Decentralized and Peer-to-Peer exchanges. In this blog, let’s unearth the complete ins and outs of decentralized crypto exchange platforms!
What is Blockchain Decentralized Crypto Exchange Platform?
Decentralized exchange platforms are the channel that allows trading peers to connect and perform operations without any central governance or third-party intervention. The decentralized crypto exchanges are much safer than centralized, as the trading peers do not transfer their crypto assets to exchange wallets.
DEX maintains its databases in the distributed network of a blockchain framework, thereby avoiding single-point failure systems. Now, the traders are shifting their interests upon decentralized and P2P crypto exchanges than a centralized one, for enhanced security!
Sure, setting up the decentralized exchange platform at the earliest stages can reap you huge benefits! When you are setting up a decentralized crypto exchange platform, you must enforce them with essential components. Here’re them!
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Components of decentralized crypto exchange platform
Admin Module
The admin module must be designed entirely in a user-friendly manner, so that even the people without any technical experience may handle it. As you are dealing with exchange platforms, you must be able to generate monthly reports, verify customers, send email notifications and authorize access to multiple admins. You must set up the easily understandable admin module for the crypto exchange platform.
User Module
The exchange platform must have the user module that enables peers to buy and sell crypto coins as per their desired strategies. Users may wish to perform arbitrage, market making and mirroring strategies. Test the user module with all the functionalities before launching the exchange platform.
Trading and matching bot
The match engine is considered as a significant component of the exchange platform. The bot matches the order requests in the exchange platform and connects the trading peers. Some of the advanced trading engines are designed with automated trading strategies for paid subscribers and users.
Liquidity API
Liquidity of assets is the major concern for many crypto traders. Hence, your decentralized crypto exchange platform must be integrated with liquidity API. Your users may trade within the exchange platform to win lucrative deals by exchanging the crypto coins.
Wallet Integration
The crypto traders get their traded coins in their exchange wallets. Hence, your decentralized exchange platform must be built-in with the highly secure, multi-factor authorized wallets.
Intuitive UI
Every application must be designed with an intuitive user interface so that users can perform their operations without any hindrance. The exchange platform must be built with the compatibility of multiple devices like mobile, desktops, tablets.
To design the above-mentioned components, you must be aware of the process in the decentralized exchange platform. Here’s how the operations of decentralized crypto exchange occur.
How does a cryptocurrency exchange platform development?
Let me not create boredom with elaborated process flow! Just the bullet shots!
The user must register in the decentralized exchange platform with the required details.
The crypto owner wishing to sell the asset can post his order request in the exchange platform. The owner posts the order request with the following information:
- Number of coins,
- Cost of the cryptocurrency,
- Bidding time.
Once the investors are satisfied with the order request, they can bid their norms.
If the trading peers accept each other’s order request, the trade operations are executed.
The crypto investors can also create their order request if there are no matching order in the exchange platform.
Now, let’s figure out the steps to set up a decentralized crypto exchange platform.
How to set up a decentralized cryptocurrency exchange platform?
1. Scrutinize Market Space
Pierce through the crypto market space and examine the operations. Consolidate the features of your competitor’s like Changelly, Wavex DEX, EtherDelta, IDEX, Cryptobridge.
centralized and decentralized crypto exchange
A decentralized crypto exchange (DEX) is an exchange platform that is not governed by any central authority. People use these marketplaces to trade cryptos. Also, in the case of DEX, a private key is controlled only by the user.
2. Aggregate the capital
It’s mandated to get set with the capital funds to launch a business. Aggregate the funds required to set up a decentralized exchange platform by consulting the professionals.
3. Consolidate the list of features
Build your decentralized cryptocurrency exchange platform with advanced features and elegant user-interface. Let me help you with a list of features that the crypto community strives for.
Some of the features for a decentralized cryptocurrency exchange :
- Integrated IEO Module
- Margin Trading
- Security Token Exchange
- Mobile Application support for Android, iOS
- Liquidity API
- Atomic Swaps
- Multi-currency pairing
- Crypto Wallet Integration
- Admin Console
- Issuer Console
- Trading Bot
- Cryptocurrency Price Ticker API
- Rest API
- Leverage Trading
- Referral Program
- Multi-language support
- Payment Gateway Integration
- Market Making
- Matching Engine
- Futuristic CMS
4. Decide the geographical location.
Not all countries accept crypto payments. Some of the federations have designed strict regulations to set up crypto businesses. Some of the countries which permit decentralized cryptocurrency exchanges are USA, Germany, Switzerland, Brazil, Luxemburg, Hong Kong, Malta, Estonia, and Bermuda.
5. Peep through the laws of the jurisdiction
Abiding by the laws of jurisdiction is the significant process of every business setup. Launch your crypto exchange platform by abiding the laws of the jurisdiction. You can hire a legal counsellor to check through the norms, to be on the safer side.
6. Partner with Development company.
You can pick the crypto exchange development company based on their technical expertise, project portfolio, and price quote. The company must have a team of blockchain developers, front-end developers, marketing professionals, business analysts, and other people to support your project.
7. Launch the crypto exchange
You can launch the decentralized cryptocurrency exchange platform for the target audience! Your decentralized exchange platform must be outreached to the crypto community with innovative marketing techniques. Market your exchange platform in possible community portals, search engines, social media, and advertisement campaigns.
8. Round the clock support
Infant users may not be in millions; hence every user is your valuable asset, afford them support rapidly. The customer support helps you stand out of the crowd and gathers a massive user base!
Upshot!
Decentralized crypto exchange platforms have gained immense popularity in recent times due to the anonymity, scalability, security features. The earliest you set up the exchange platform, soon you can gather a massive user base and perform trials to make the business successful!