A White label crypto exchange software is a readily available package with all in-built technical functions. A business firm can purchase the white label solution and then customize it according to its preferences.
The various facets to look out while choosing a White label exchange platform
- Support for different cryptocurrencies – The white label crypto exchange should be able to accept transactions made in various cryptocurrencies by users. Hence, multiple pairing options must be available. It must permit both crypto to crypto trading and crypto to fiat trading. The list of cryptocurrencies present on the platform should be displayed transparently to avoid any ambiguity while executing transactions. Facilities to buy, sell, deposit and withdraw must be available for all the participants in a market. The market rates offered should be competitive. More currencies can be offered by partnering with the leading exchanges. Round-the-clock customer support should be provided for the purchase of digital assets. Trading must be available across all devices and operating systems. It would be better if the trading fees were kept low initially. An exchange which does not support many cryptocurrencies will not be able to attract traders.
- Support for preferred trading – The user should have the freedom to choose from a list of traders registered on the platform. Hence, they will select a specific buyer or seller for doing trading. They must also be given full freedom to cancel the trading process at any point of time in case of any trust issues. The presence of preferred trading as a feature adds value to the exchange in the long run.
- Multilingual recognition with GPS – Since traders in a White label crypto exchange would be located in different parts of the world, they should be able to communicate with the support team in multiple languages. Translation using an automatic tool or a qualified person would be required. The trader’s exact location can be determined using a GPS tracker facility. These steps are taken to ensure clear communication. When a trader interacts with someone in his native language, it gives him a sense of trust and comfort. It helps in building a reputation among the cryptocurrency community and leads to an improvement in acceptance. White label crypto exchanges that offer multi-lingual support can experience a quick rise in revenue and gain access to untapped global markets. Misinformation and spread of fake news can be tackled through multi-lingual support.
- Unlimited token addition – A facility should be created for enabling traders to avail an unlimited number of tokens. The digital assets featured on the platform must be exchangeable and easily tradeable in nature.
- Initial Exchange Offering (IEO) – Users should get access to newly raised funds and enabled tokens on the platform without facing cumbersome procedures. The fundraising process is safer in IEO as due diligence is undertaken by the crypto exchange before accepting any project. The cost of marketing is low and exchanges would directly open the tokens to the secondary markets fetching sufficient liquidity. Safety in investments is ensured as all investors will be required to comply with the KYC (Know Your Customer) and AML (Anti Money Laundering) guidelines. Since the listing and marketing tasks are taken care of by the IEO itself, the exchange can focus more on developing a well-rounded product. Issuers of tokens do not have to worry about crowd sale security as the exchange is managing the IEO’s smart contract. They can get access to a wider user base depending on the exchange’s reputation. Details such as matching the corresponding demand and supply, tracking the circulation of tokens and analyzing the impact of daily trends are all taken care of by the exchanges itself. The entire fundraising process is made effortless thanks to IEO.
- Liquidity management – Liquidity refers to the ease at which assets of a user can be seamlessly converted to cash and vice-versa without influencing the market price of the assets. High liquidity in an exchange ensures a large trading volume and better trust among investors. It will not affect the security of conducting transactions. Sufficient liquidity enables all participants in a market to get access to fair prices and ensures market stability. There will be an increased accuracy for conducting technical analysis. Low trading volume, less number of cryptocurrency exchange software in the market, lack of acceptance of crypto and more restrictive regulations issued by authorities can affect the level of liquidity. Higher liquidity ensures that the exchange is resistant to market manipulations done by whales and other influential players. Liquidity can be measured by analyzing the 24-hour trading volume of the exchange, the depth of its order book and the bid-ask spread.
- Escrow services – It functions like a trusted and credible middleman in each transaction executed on the platform. It ensures that both buyers and sellers face an impartial trading experience and are protected equally without any compromise on their security and confidence. Buyers will be protected from fraudulent sellers through escrow services. It also helps in solving disputes. Escrow is a cheaper solution when compared to other payment methods like credit cards. Escrow services are compatible with major multi-sig wallets. It verifies if the terms and conditions mentioned in the agreement between buyers and sellers are being followed diligently. Hence, it eliminates uncertainty. Escrow services do have some drawbacks as some official providers charge a hefty commission on their services. While administrators of a White label cryptocurrency exchange are quite busy monitoring the core functions, they appoint other users as guarantors instead despite the risks involved. Hence a user would be tempted to bypass all the paperwork involved and conduct deals with others in the absence of a reliable safety net provided by the guarantor. If the obligations are not fulfilled by the individuals, the white label crypto exchange could be held culpable for deliberate negligence. Exchanges should assume financial responsibility for the actions taken by guarantors.
Hence verify with your software provider if they have all the above seven features in their White label exchange platform. In case all the aspects are not available at one shot, certain features can be added through customization. This will enable you to survive profitably in a competitive market.