Whether it’s stocks or international currency, the word “exchange” has always been used to describe any business thing whose value can change. The cryptocurrency exchange is the most anticipated and newest member of this group of exchanges. The growth of any p2p crypto exchange development is directly related to how many people use it, and the number of cryptocurrencies changes every day. Cryptocurrency exchange owners are taking advantage of this new way to make money by making it easy for people to trade between different cryptocurrencies.
How do these exchanges for cryptocurrencies make money? What is it that keeps people interested in building cryptocurrency exchanges? Let’s find out by reading on!
There are many different ways for cryptocurrency exchanges to make money. There are many ways for people who run cryptocurrency exchanges to make money.
Initial Exchange Offerings
Initial coin offerings, or ICOs, were seen as one of the first big ways that blockchain and investments came together. But because ICOs had a bad name and were dirty, they didn’t last long and were soon forgotten. A lot of crypto projects and companies have listed their project tokens on already popular exchange platforms instead of putting in the work to market the ICO and get them listed on the exchange, which can be risky.
This process makes sure that no time is wasted on building credibility for the token, so that it can be used to judge the credibility of the exchange. This saves a lot of time when it comes to putting out a stable product. But you have to pay the exchange a fee for the token to be listed, which brings in good money for the exchange.
A listing on an exchange usually costs between 5 and 10 bitcoins. It is known that reputable exchanges charge between $1 million and $2 million per listing.
Even though the small percentage might not bring in a lot of money, it does have a big effect on the number of trades.
When it comes to traditional banking, stacking schemes can be seen as a good match for the idea of fixed deposits. Traders’ money is locked up in the exchange, and the exchange pays the traders interest on it from time to time. Most of the time, the interest rate is between 1% and 10%.
At first glance, it might look like exchange owners aren’t getting anything out of this. But if they have a lot of cryptocurrency, they can use it to spread out their investments and make more ways to make money.
For example, this deposit could help cover their operating costs so that they can get more companies to list their crypto projects on their exchange.
Fees for Consulting
We’ve already talked about how crypto and blockchain are still in their early stages. Not many people can be considered experts in this field, especially when it comes to investing in digital currencies. To get more investors, some crypto exchanges have started offering expert advice to investors on the side. This helps them diversify their portfolio of investors and make more money.
Yes, we know that most of you have probably been waiting for this topic. When it comes to cryptocurrency exchanges, commissions bring in the most money. To make sure that their transactions are valid, crypto traders pay fees or commissions. The transaction fee is anywhere from 1% to 3% of the total amount of trading. Binance’s transaction fee is only 0.1%, which is a huge difference from Coinbase’s fee of 2.99%.
Creating a Crypto Token
It might not be too much of an exaggeration to say that the cryptocurrency exchange makes more money as more people use it. So, exchanges make their own crypto tokens and offer lots of good deals to get people to use their exchange.
Binance made its own coin called “Binance Coin” (BNB), and it gave traders an extra 50% commission on their training fees if they used that coin to trade. This caused the price of the coin to go through the roof, and a lot of people took advantage of this to start trading cryptocurrencies through Binance.
Building your own Crypto Exchange
From what’s been said so far, it’s clear that trading currencies is a good way to make money. But perfect cryptocurrency exchange solutions are hard to make because they have to deal with a lot of complicated issues.
As a workaround, you can think about using white label cryptocurrency exchange development platforms. A lot of companies offer cryptocurrency exchange solutions that can be changed in a lot of ways and already have all the basic features of an exchange built in. At the same time, they are flexible enough to adapt to changes in terms of functions and UI/UX, so they reflect your brand’s language and philosophy.