Zero Fee 0% Bitcoin Exchange

[Stormbringer]

For a start it could be exchange with lesser cost than it is now on major exchanges, and as you earn revenue from ads you can lower fees.

[GaryL]

I hope you can create such a site, be sure to let me know if you have completed.

[DeathAndTaxes]

Also, with the way the law is in the USA, there are lots of potential legal issues when dealing with the exchange of USD.

This will be a Trading exchange only. No Fiat deposit/withdrawal.

I don't want fees associated with the exchange therefore fiat must be eliminated.

Buyers must have the coins in storage then use this exchange for trading. The actual exchange isn't processing orders into the blockchain,  the server will just operate an efficient order matching engine.

If we can use cold storage escrow for deposits, we'll avoid regulation completely, and just be the liquidity engine for matching orders at millisecond speeds.

FinCEN has stated the exchange of virtual currencies for real currencies or other virtual currencies constitutes money transmission and requires registrations with FinCEN as a Money Service Business?  So you will be blocking US based customers correct?

[True___Blue]

I thought Huobi and OKcoin did not have trading fees

[DeathAndTaxes]

I thought Huobi and OKcoin did not have trading fees

I believe they charge fees of deposits and withdraws.  More than one way to skin a cat.  I believe the OP's idea is to build the worlds best exchange with state of the art features, security, and speed without any revenue.

[Elizann]

I propose exchange that pays me Each time I trade I get 0.03%

[makebitcoin]

We also need poker without rake. I don't see that happening anywere around a business. You could try exchanging between friends and voila you have 0 fees.
Same way with poker, you only find home games with 0 rake, anytime you got an exchange or website you have to pay fees or rake.

[ViewSonic]

Sounds like an unreal business model.  Exchange will never exist when it has no money to pay bills with

[jzcjca00]

It should also have unparalleled customer support.  Since Bitcoin is global, they should be available 24x7, including holidays.  They should respond to all issues within 1 hour.  Where can we find a few dozen people who are willing to work long hours, doing a difficult and thankless job, with zero pay?

[Born2Bwild]

First we need an Exchange with Zero Fees. Crypto exchanges are sprouting up like weeds and they're all the same. Poor API , poor desktop and mobile trading apps. exchange holds coins, and 0.2% fees.

If we have an exchange with zero fees it would add liquidity ( by providing an incentive to buy/sell on exchange) and offer better trading conditions for all traders ( more liquidity means more buyers and sellers are waiting to trade at their prices which decreases the spread between the Bid/Ask ).

Any Exchange with Zero fees?
If no, lets build one.

What's the point of making exchange with zero fee? It's non-profitable. Sorry, for comparison, but it's like letting other people to your toilet in your own office.

[CoinMKT.com]

While it would be nice it is not a sustainable model to keep the exchange going unless you are doing it for charity.

[asfbhero]

What you need are exchanges paying rebates to traders for adding liquidity so you'll get flow and market making strategies getting run on the exchanges, which will tighten spreads, decrease volatility, increase liquidity, and generally make for a more robust stable and ordinary market. the exchange makes the difference between takes and adders fee, charge say 0.02% to take and pay 0.01% to add.  everybody wins

[androz]

a fee free exchange ? well, very interesting, but i can't imagine how they get profit.
at least you could do like this, make ppl pay a 1 yr  trade memberships  .
In the dreamland ads only will pay maintenance fee ....

[asfbhero]

NOT fee free, People who Buy at the ask, and sell at the bid (Takers of Liquidity) pay, for example a 0.02% commission, while people who add liquidity, market makers, by buying at the bid, below the ask, and sell at the ask, above the bid actually GET PAID what's called a rebate of, for example 0.01%.  So the exchange earns the difference, 0.02%-0.01%=0.01% profit per trade for the exchange.  The 'regular' trader still pays 0.02%, but 1/2 of that is going to pay the Market Maker, effectively in exchange for taking the other side of his trade, and making the exchange he is trading on more trader friendly.  aka, better.

The trader adding the liquidity, the 'Market Maker', gets earns the extra 0.01% per trade, the rebate, paid by the exchange, which in the case of opening a TON of trades, many of them ending up at breakeven, ex. you buy the bid, then notice that a huge sell is coming down the line, so you hit the bid exiting at the same price you entered as to not lose money, but you still have that 0.01% rebate n profit.  Depending on how the exchanges develope, and what size rebates exchanges end up giving, rebate only strategies could be profitable as well, where you just buy the bid as huge as you can, then immediately sell at the bid with the purpose of earning as large a rebate as possible, the same at the ask, and you just do this as often as you , or your algo possibly can.  

Which is great for "regular" traders because theres always someone there waiting on the bid and the ask with large orders out there for traders to buy or sell into w/o pushing the price around whenever they want.  Exchanges pay this fee to liquidity providers because we make it possible for "regular" traders to execute their trades on demand, because we are there to take the other side of their trades.  The easier it is to execute trades, the more liquid a particular exchange is, the better & safer a place it is to trade.  Which in turn drives more traders to participate at that particular exchange, in relation to their competition.  It's an awesome, natural, free market informal relationship that is good for everyone.

What I am currently trying to do for bitcoin, because I was really good at it on CITI stock before the reverse split, and virtually no one is playing Market Maker in Bitcoin right now so there is TONS of money being left on the table and/or being pocketed by the exchanges.  Market Makers are an essential part of any market, and as Bitcoin matures institution and those who already have, usually professional, Prop Trading, Hedge Fund, BB's, people with institutional experience will surely swoop in and fill that currently vacant area of the market.  I hope I can figure out where best to trade this strategy, learn the best way to execute it on BTC/USD, and get my size up high enough so that when large players come in to fill the void I will already have an established spot as well as a solid head start on learning and refining what is really a combination of flow trading, market making, and HFT strategies.

Hope I explained myself properly.

[cysive]

And.. how would the exchange pay for itself?

Volume!

[byt411]

ANXPRO, an exchange based in Hong Kong, has a 0% Trading Fee. Is that what you are looking for?

[Este Nuno]

Exchanges need revenue sources that are reliable and ads won't cut it. There are costs in running any business, exchanges included.

[madken7777]

Hiring and implementing security measure cost a lot of money.


Without fee, who pay for the security feature?

[agoraadnim]

Sounds awesome. Hope it works out for you and you can keep it going.

[byt411]

Hiring and implementing security measure cost a lot of money.


Without fee, who pay for the security feature?

ANXPRO has other income methods, such as fees on Bitcoin ATMs. Feel free to check us out.