Bitcoin Forum

Aside from complying with regulations such as KYC/AML, I've started to wonder how easy it is to create my own crypto exchange?

In the case of a decentralized exchange based on smart contracts, anyone with programming skills can launch their own DEX for the world. But the real issue is to provide support to customers, and comply with every single regulation imposed by worldwide governments. At a certain point, starting our own cryptocurrency exchange might not be an easy task to do. Launching a centralized exchange instead of a decentralized one might be even more difficult for the average entrepreneur, in my own opinion.

So I'm wondering what's the easiest way to launch a cryptocurrency exchange? Does taking the path of decentralization, help you avoid complying with certain regulations? Or is everything the same with a centralized exchange? Maybe creating a Peer-to-Peer site where users can trade crypto in person for Fiat, would be the easiest path to go? Isn't it?

Any recommendations or suggestions will be highly appreciated. Thanks in advance. :)

Do not advice people to do this, their first aims will be money making, leave crypto exchanges to professionals, running an exchange is taking a whole lots of responsibility, users funds is on the exchange owner's neck if any thing how wrong, this is not erc20 token where anyone can just build with few clicks

Exchanges were much in need, and now things have got to be very easier to start one's own cryptocurrency exchange. Every exchange is now focused on decentralization, but in my view the era of decentralization hasn't come yet. It takes time, and people too now prefer centralized exchanges.

it is not easy at all. first of all you have to have a very strong team that is trustable, nonanonymous and popular. So people can trust and prefer to use your platform. And you have to invest high amount to be able to make marketing and circulate the flow for a while.

I did not think too far to launch an exchange on their own. Some points that I must convey if friends want to hear.
first you want to launch an exchange of course you have to build a community like other projects do.
secondly, I think your suggestion will make someone interested in launching their own exchange just to get money or in negative matters we might not want, but this way is quite easy to raise money..
Even today many scam exchanges have been born this year. let's forget about this and focus on trading because you can make a profit every day.

for seriouse project to build crypto exchange is very high cost, and the exchange always need to be check if your exchange contain a bug or not, also need to hire someone who could care the server without problem...
Graphic designer is most important to attract people to your exchange with nice graphic, i can assumed to build good exchange need atlease xx hundred thousand dollar

Aside programming the exchange, hosting it to constantly be online is not as easy as we think. A lot of technical activities goes on at the backend to secure users funds and information to ensure no hack occurs on the exchange. Exchange owners goes through a great deal to ensure the exchange is what it's supposed to be.

Thinking about the system of the exchange, for me its not easy to create exchange because it requires a good system and a huge funds for the capital. If you really want to create your own exchange then you have to ask your friend to work with you and be a good team. Exchanges is not about buying and selling, it requires a good service so people will use it.

Good exchanges are capital intensive . So going into such venture is a big deal for me. I am not thinking about it.

Indeed, it is not something you can do in one sitting with just your computer alone. An exchange is not like the ERC20 tokens nor mining that can easily learned if you have the right tools. It's a whole business and requires a lot of knowledge, guts and effort.

If it is gonna be an exchange that makes sense then I don't think it will be an easy but to crack. Good exchanges don't come cheap and I don't think everybody dhoijd aspire to open exchanges

It could be quite easy to start a crypto exchange. You could buy a ready made script and set some APIs. The trouble is on running the exchange.
Even if you get users, your exchange would be a target for hackers and abusers. You would need an active team to counter any security threats and keep the site running.
With so much exchanges on rise, you need to have something unique to succeed.

Running an exchange isn't as advice as you might think. Take a cue from the numerous exchanges that have shut down due to one issue or another. It requires funding which I don't think you have, a developer team since you can do it all alone, and even partnerships.

There are few things to consider if you want to build a very good exchange, first is good team, better funds and new idea, i'd say building exchange is the hardest thing to do in crypto space this is why it's not a right choice for those who have zero knowledge about exchanges

Just like what that already used by common exchange site.

it doesn't. The decentralization will not help you to avoid to comply with a certain regulation. Idex has already proven it.

When you are wanna getting a huge demand and everything must adopt from the centralized exchange site.

It's no different from what we have called decentralized exchange site. have you been thinking about the regulation if you wanna make fiat available as your pair?

decentralization is certainly required and also transparent, certain regulations do not matter it is very good because good exchanges issue regulations for the security of account holders themselves not for prize seekers and from existing exchanges you should have references to be better than them

Before launching one you need a background on other projects that deals with transactions and security, because you will full of it, remember it's not only internal issue that you are going to face, but you are also facing issues, on hackers trying to hack and bring down and compromised your exchange, if you have the funds and you can get the best team then you are good to go.

A good team is needed for an exchange because it is not only for security from hackers but requires a creative team of designs and unique features, so as to make the exchange look smooth and comfortable when trading

hell yeah  , two or more people is better than one but if you think you have the talent to do multi task then why not   ? you can be the mastermind of your own   . that way you can save alot of fee and you can earn more profit   . if your skills are mainly online like programming for example , you can easily learn other online skills related to it  . the only important for all of them is the budget or the capital because if your exchange got popular , big traders such as whales will enter it 

Easy said than done.
Even this is the easiest thing to do and to avoid AML, you need to establish your platform first in the market. Like no one will have a P2P on an amateur site that doesn't have enough clients to use it.

You still be needing developer to optimize your site and of course, a real time customer support that can be easy to reach out when problem persist.

Imagining of how easy it is to make one, I'm starting not to think about it. Making one is a serious commitment and you shouldn't just leave it if you have already started it only if you have already the funds of customers. But breaking down from the beginning of it, the cost of it, from the developers and considering you should follow your local rules upon creation.

There's more to go, AFAIK you also need attorney and legal counsel for you to be able to be right on path before creating your exchange. It's a broad thing to think of and it's really stressful if you're starting out. I don't have it on my mind, I'm okay to be a user and this is a serious business which requires hefty amount of money because you have to invest in security mostly.

It really is harder to launch a centralized exchange than a decentralized one, the competition is very stiff, you need a good team and security team, hacking is always the main issue and of course marketing and attracting new traders are one of the big issues that confront new players, we have seen ICO based exchange that cannot take off, because of the many issues.

In my opinion it is very difficult if you want to start your own cryptocurrency exchange. This is not an easy thing to do. The burden is very heavy, especially you have to have a team that is truly honest and experienced in their field. Building a team is not easy, it is very difficult and you also have to have a good reputation in the crypto field because as the owner of a good reputation exchange is a consideration for people to use your exchange services.

its not so complicated,  
and that one  with the xx hundred thousand dollar .. ???
... but yeah, you are right.  somewhere between 1 dollar and xx hundred thousand


by the way,  feel free to visit some tiny unnamed.Exchange (http://unnamed.Exchange)
maybe you like it, and want more infos :-)

and no..  not one of these dex.builds, not potatio or similar,  or some open source clone.
or any other wannabe shit




just an solid build exchange system  8)


 .. some unnamed.Exchange (http://some unnamed.Exchange)

One of the biggest problems is trying to set up anew exchange is the problem with local regulatory systems. You have to follow them even if you are a CEX or a DEX. These days government is cracking down on every operator and making them KYC compliant to force them to give the transaction data of their users. This seems bad to us but for the government it is necessary to keep money laundering under check. Most of the users here may not be doing criminal laundering but there are people who do this.

Apart from that, you have to develop the DEX first, then have a source of funds ready, keep hot wallets and cold wallets in proper shape, maintain the system and take care of customer service.

If you do have the money then you can build up but there are several factors needed;

-Knowledge on coding skills,programming and developing - Its dumb for you to start one if you dont have any knowledge.

Next,
You cant be sure if your new exchange would get enough support or traffic due to competition but if your newly built
exchange do get some attention then your lucky.

There are exchange scripts that you can just install to your server, not sure about the security but its sure not easy since even the well known exchange like Binance were still hacked. If the hacker got into your exchange and got all the funds, I don't think you can recover the coins back being your exchange is just done by a non programmer. Not easy to maintain as well. Cryptopia died in the end just like the coinexchange.

If it is a big exchange buying a exchange script to someone who selling it will be risky since it involves with big money. It will be fine if it's just a blog or news website but we are talking about exchanges which involves cryptos with value.

They should need to hire developers and experts on databases and expert on security to be able to protect their website to any attacks.
He should also need to hire people as a support to help people having issue from their exchange.

For me, honestly it's hard to start an exchange site if you are the only one who will manage the exchange you will need a team and partner to be able to stay alive as other exchanges.

I bet it is not secure at all. Anyone can buy those scripts online. They can then test it for various vulnerabilities. Once they find one, they can then look for exchanges that use the same script. They can then abuse the vulnerability and break the exchange cause enormous damage to both the exchange and the user. It is better to make your own exchange from scratch using all standard and top notch security.

The question is not how easy but how hard creating an exchange, it's a multi-million dollar industry, you need to get the best coders, security experts and promote it to traders and community because the competition is very stiff, I have been a part of so many exchanges based ICO but unfortunately, they cannot keep up with the competition, they are competing with companies with millions of dollars budget on promotion.

Believe me if mcafee cost less than a million dollars to create mcafee dex as he was using all of the open-source code and UI. It does not need a lot of money to launch the new exchange sites but that will need a lot of money when your exchange becomes more and more popular and you must do a lot of RnD especially for the security maintenance that will cost you a lot of money.  If you wanna create a big scale of exchange site and these requirements that already stated in this article https://www.quora.com/How-much-does-it-cost-to-set-up-a-cryptocurrency-exchange will cost you a lot of money.

I can't imagine the work if only one person is managing a growing exchange and this is why we see some of them posts that they are hiring moderators and programmers.  Mcafee only used the opensource scripts to develop his dex I think a team can also do this to develop another approach. Marketing Mcaffee dex though was easy for him since he is already popular but for an unknown dev team, its a hard job.

I've figured it would be hard to do this in the long run. Instead of creating an exchange from scratch, it's better to use existent solutions to create your own exchange without much effort. Perhaps, becoming a Bitshares gateway would be the best thing to do? Still though, there's the need to comply with government regulations. One mistake and your "out of the game" for good. The only way I see this would work is by designing a P2P exchange site where people can trade crypto in-person without the need to comply with KYC/AML. At least, that's the way the "Local Bitcoin Cash" site has been doing today. But if governments continue to enforce strict regulations, it might scare many exchanges away from the crypto space.

With a good team, and enough funding for the launch of a crypto exchange, anything's possible. If you don't meet those requirements, then you're better off with being a Bitshares/OpenLedger gateway or a 0x Relayer. There are many ways to do this, but the real issue is complying with every single regulation imposed by worldwide governments. Just my thoughts ;D

Need team work for manage manage for growing exchange and have experience and proffesional team how to build good and most secure exchange, I think you need time and always possible for building exchange market, look what happen with BCNEX is new exchange but keep exist right now and many investor trade and invest there.

These days it's easy not to make one but to own one, basically if the script exists, the entire code, you can buy it and own it. Casino, Exchange, even entire blogs with content all pre-prepared. I've seen it even, the AI these days are pretty sophisticated that if you don't know your things well enough, they all look real to you.

About attorneys, you only need them if you want a compliant exchange. But what's the point of just creating one if you can't run a business? And what happens when you find bugs and what not, how're you going to fix them?:)

I have seen in their ToS, the users who use their services is accept their own country's law, although this is not charged to the exchange, but the law in each country still applies. The fear is that if a user violates cryptocurrency laws in his country which causes him to get into trouble, because most internet providers are overseen by the government.

Its a very risky to do meetups when the country's law doesn't allow cryptocurrency, I would rather be selling coins thru DEX exchanges than going into such path. You'll never knew the person you intend to meet is a government agent.  Meetups alone is dangerous to do even when crypto is allowed in your country.

It is a big risk to take. You are taking responsibility of thousands of coins trusted upon your exchange by innocent people and you would use a bought script? There will always be a problem is hidden vulnerabilities. Hackers often pose as developers of such scripts and sell them for some money and then one day they execute those exploits and steal coins from the exchanges.


Meetup exchange also has the risk of robbery and getting beaten by by goons hired by a scammer. This was the reason why exchanging assets online was started.

If crypto is illegal (or has no legal status at all) that means that cryptocurrencies are worth nothing to govs so you can't sue anyone.
Also at this point crypto field is full of illegal activities (I mean real criminals) and this makes meetups more dangerous.

Thanks for the tip. There's a lot of responsibility involved, especially when dealing with people's funds. Not to mention, I'd need to comply with every single regulation imposed by worldwide governments. Even decentralized exchanges are not exempt from this. The best path to take might be creating a P2P trading platform where people can post their own ads for buying/selling cryptocurrencies in-person. It would be something similar to eBay, where people post their own "item listings" for sale. I believe that with this model, the responsibility would lie on the user himself instead of the owner of the P2P trading platform.

I've seen pre-made scripts available for purchase online, but they look quite risky to me. As you've said earlier, hidden vulnerabilities would expose the exchange towards hacks and theft. In order to create an extremely secure exchange, one needs to hire computer security specialists to maintain the site resistant against online threats. The costs and responsibilities involved in setting a centralized exchange makes it challenging for the newfound entrepreneur. Which is why, my options are limited to either a P2P trading platform, a 0x relayer, or simply an OpenLedger/Bitshares gateway. :)