Crypto exchanges are a relatively new segment of the financial world. The first ones were unpopular and unsafe, since independent developers made them for free, fueled by mere enthusiasm. Big companies did not see the new market rising yet. Therefore, people had to use whatever was available. However, creation of more sophisticated exchanges was inevitable, because Bitcoin had just started to conquer the crypto world, and more people wanted to buy it.
The main difference between crypto exchanges back then and now is popularity and credibility. In 2011, Bitcoin was the single best-known cryptocurrency, and emerging exchanges needed it to gain users. In 2019, new coins and tokens appear every day, and the point is to get them listed on the right exchange.
A cryptocurrency exchange is a trading platform that is functionally similar with the stock market. However, instead of shares, users exchange digital and fiat money. Some services operate with digital coins only.
Depending on supply and demand, purchase and sale rates may fluctuate, which creates a potential for trading and investing. The most famous exchanges are inherently well-protected, which makes losing money almost impossible.
Every exchange has a list of coins and tokens available for trading. If a coin is new and not prominent yet, it is most likely going to be available only in exchange for BTC; the rest depends on the terms and conditions of its listing.
Stock exchanges circulate fiat money and securities. If a company wants to go public, it starts to sell its shares in a stock exchange. A company sells a share once, and then an investor who bought it can either keep it for getting dividends, or sell later for a higher or lower price.
Exactly the same thing happens with coins and tokens. There's one difference, though – crypto exchanges do not always have to be compliant with any government or legislation. That is what makes them diversified. Therefore, when it comes to token listing, sometimes it is not easy to make a choice.
Here are the main characteristics that have to be evaluated. Obviously, all projects are different, and for some of them certain qualities of an exchange may be more or less important than others. In this article, we use a generic approach to evaluate an exchange, in order to consider all the possible pros and cons.
About 5 years ago, relative popularity did not guarantee the reliability of an exchange. Most of them were unable to provide simple security, let alone usable interface, fast transactions and good design. Nowadays, a crypto exchange is a huge market with billion dollar budgets. Popular services care about their reputation and user experience. Moreover, if we are talking about listing for a new coin, it is important to draw attention. Exchanges with high traffic and trade volumes can certainly provide that.
Sometimes it is not easy to get a coin listed on an exchange. All of them have different conditions and requirements. The bigger an exchange, the more thoroughly it checks all the coins that apply for listing and the more it costs to get there — and the fee can go right up to $1-3 million on the biggest exchanges.
As opposed to them, mid-sized exchanges, such as ours, tend to keep things affordable for startups and combine streamlined approach and flexibility of actions, which helps us list new coins quickly.
Breaches and stolen coins can affect all the three sides: users lose their money, exchange loses reputation, and projects that listed have to come up with the idea how to get all the stolen money back. Sometimes it is just impossible, so the project loses reputation as well.
However, things are far better now than they used to be a couple of years ago. Exchanges emphasize their security measures, so you'll be able to check that easily.
Even if you have chosen a fitting affordable exchange, the listing process is still going to take some money and time. On the other hand, listing is one of the fastest ways to find new users and make a coin viral. It is capable of bringing millions of dollars if the project is promising, well-promoted, and continuously evolving. In this case, choosing the right exchange becomes crucial.
Some of exchanges, including our own, serve as launchpads for — Initial Exchange Offering — a fundraising campaign that helps you distribute coins among investors, using the exchange itself as a reliable middleman. It is conducted well before listing makes your coins available for trading.
In a nutshell, your approach depends on your goals and the specifics of your project. If you have any further questions, just let us know. We are always ready to consult you and help you make the optimal choice.
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