Simple Guide to Building Your Own Cryptocurrency Exchange or What You Should Pay Attention To

Which Type of Cryptocurrency Exchange Platform to Choose

  • Centralized Exchanges (CEX)
    This is the most popular option in the crypto sphere. Centralized platforms use intermediaries, which means that it is controlled from the main server or by a third-party company. Thus, it offers the options of both fiat-to-crypto exchange and crypto-to-crypto trading. Such a solution has easy-to-use UI & UX, gives clients a quicker response, and you can add an unlimited number of features into it. High trade volumes and liquidity along with a great reputation is what these platforms offer. However, choosing this option will mean that you aren’t the owner of the private keys, which is why you will need to think about security measures.
  • Decentralized Exchanges (DEX)
    In the case of DEXes, no company is in charge of the assets. Buying or selling cryptocurrencies happens automatically and with the use of decentralized applications and smart contracts. Also, you should know that most of the decentralized solutions operate using Ethereum, which means that it might not be the best option for Bitcoin for example. Unlike CEX, DEX doesn’t require to store user funds on trading accounts.
  • Hybrid Cryptocurrency Exchanges
    To simply put, this is an option that combines two previous solutions. Thus, you can include both the advantages of DEX and CEX, such as fast transaction speed, secure assurance, and the ability to hold the private keys. This type is not as advanced, but it is rapidly gaining popularity.
  • Peer-to-Peer Exchanges (P2P)
    This is a direct purchase or sale between platform users, and a good option for beginners, because it includes only these two functions of selling and buying. In this case, there are no intermediaries as well, and the software transfers cryptocurrency confidentially from the deposit of a seller to the buyers’ wallet. Usually, this type of platform includes the escrow services that offer users more guarantees of getting payment. It means that the users obtain their funds only after the conditions of an agreement are met.
  • Instant Exchangers
    An instant crypto exchanger has access to the best rates of trading pairs, which allows users to instantly exchange one cryptocurrency for another. With such an app, you can just register and receive funds or deposit directly to the wallet of another user. Usually, instant exchangers have the highest transaction speed and support large orders, but some users may find it complicated to use.

What to Consider When Building a Cryptocurrency Exchange Platform




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