Centralized exchange vs Decentralized exchange, Which suits the most for running a profitable crypto exchange business?
JONAS_Wald last edited by
Probably, as an entrepreneur with a plan to step into this crypto world, you would be aware of the rapidly growing business model at present. Yes! I am speaking of the crypto exchange business. This business model excels in this crypto industry by providing various benefits for those who are willing to step into this. Many might plan to initiate with this business model, but does everyone shine is the question here? Definitely not, only those who sorted out the whole plan succeed. Before initiating this you must be clear on what type of exchange you are going to implement with your business because this is where many aspirants fail. Without proper awareness and misleading information, they are guided in some way wrong. To avoid this you should be knowing from the ground level.
Basically, a crypto exchange acts as a platform for investors/traders to buy, sell, and invest in cryptocurrencies. The crypto exchanges are classified as Centralized and Decentralized.
Centralized exchange: As per its name this exchange model works with an administrator who will be in charge of every transaction carried out.
Decentralized exchange: Basically, this exchange model functions exactly opposite to the centralized. The transactions are carried out without any hindrance between the buyer and seller.
After knowing the basic working you may be confused in selecting the right one that suits your business. I shall discuss it further.
Honestly, the centralized exchange type is highly preferred by many entrepreneurs and start-ups as it benefits them on a larger scale while compared to decentralized.
Let me give a live example, Binance exchange stands as a top preferred crypto exchange by the majority of them involved with this crypto industry. It attained this only because of its trustworthiness, feasibility offered, and so on. Also, Binance stood as a strong reason for every entrepreneur to start an exchange similar to it.
The centralized crypto exchange offers a wide range of hope to those who start their crypto exchange business. Also, it ensures to run this business profitably by enabling multiple revenue-generation streams.
Revenue generating streams:
- Trading fee:
Trading fees are considered to be one of the important ways to generate revenue. This is not a pre-fixed one but completely depends on you (admin). (But charging a minimal fee is much advisable to increase user engagement on the platform).
- Advertisement fee:
You will be able to charge certain firms/brands whose advertisements are to be live in your exchange.
- Withdrawal/Depositing fee:
A small percentage of the amount can be deducted by you while your user deposits/withdraws the money. Not everyone charges their users.
- Listing Fee:
A small fee can be charged for every new token listed on your exchange.
- IEO launchpad
You can charge fees from startups or token issuers for conducting token sales.
These are some of the structures only for your reference. There exist many other ways. After realizing its potential, one would probably be in an urge to find the best way for launching it.
Frankly, crypto exchange clone script/software has been considered as the best effective way to launch a crypto exchange in a short while. This method of launching is highly cost-effective too. All you have to do is seek a professional crypto exchange clone script/software provider for getting a bug-free, best-in-class product for your business.