How to Create a Cryptocurrency Exchange Service
This article will refer to a standard workflow for building an Coinpaper exchange (mainly a crypto-to-fiat service).
Security and safety are always the main concerns of this kind of service. To protect your service, it is very important that the features are tight. It is important to have fiat currency and preloaded crypto currencies such as Bitcoin, BitcoinCash Litecoin Ethereum Ethereum.
What are some of the safety and security features that you can include?
Consider adding features to your website like:
Email confirmation process
IP level protection
Secure Primary Card Wallet
Cold Wallet Concept – Secondary Wallet
Google reCaptcha – You can add reCaptcha to your admin and user side, as you’ve seen everywhere.
Google 2-Factor Authentication: This feature allows users to be authenticated with an OTP in real-time. Both the admin and user could add this feature.
Email Confirmation: For riskier activities, you may ask to receive a confirmation email before proceeding.
IP Protection: If you wish to block all IPs and set your IP as the default, this will help you protect service.
Secondary wallet and Primary Wallet – Shifting to the most important part of service: the wallet. The primary wallet must be very safe. Primary wallets can either be connected directly to nodes or depend on a 3rd-party secure service, such as CoinBase. It is best to always give the users an automatically generated wallet address from the services themselves and not one that was created outside the service. CoinBase has an API for this.
Think about securing your coins with a hardware/cold-wallet concept. This will secure them even further away from your main wallet. Cold storage may be used to store coins in your service, such as the exchange platform.
Know Your customer -This is also a very important point, and you can adopt strict KYC methods to protect your exchange. You can require documents during the registration process. You can accept documents from the user and email them to a secure address. This will preserve their identity. It is possible to categorize users according to the amount of their withdrawals.
Revenue-Generating TechniquesBecause revenue on exchange platforms is in the form commission, it’s possible to make money by using commissions for any type of transaction. While depositing, withdrawing and when a sale/buy occurs, the scope of a transaction is included.
Complete log of Activities –All user activities must be properly logged so they can be checked at any point. When needed, it’s good to offer a printed version of the activity.
Statistics Statistics for your transaction, the current amount of fiat currency, and coins should be displayed.