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The Ultimate Guide to Listing on a Crypto Exchange

The Ultimate Guide to Listing on a Crypto Exchange

Little over a decade ago, people knew little to nothing about the crypto industry, today, start-ups in the industry were able to raise over $4 billion in the second quarter of this year alone. What this points out is that. More people are dealing in cryptocurrency now than when it came into the scene a decade ago, with coin offerings continuing to expand.

If you think of having your coin listed on an exchange, you are not the only one. Several crypto entrepreneurs are dreaming of listing their coin, but the questions you need to ask yourself are; 'How can I create my coin, and where can I list it?'.

Due to the popularity of blockchains and their advancements, creating your coin is fairly simple. It isn't as hard as you think unless you are not tech-savvy. Even if you are not, you can always hire a professional. With blockchains like Ethereum and its ERC-20 standard or the Binance protocol, with these, you can easily establish your coin and token. The main question here is whether you should list your coin on a third-party exchange or create an exchange for yourself and list yours there. 

Whether centralized or decentralized, listing on crypto exchanges is the only way millions of crypto lovers out there can trade tokens and also discover new crypto gems and the prices of these digital assets. If you struggle with listing your coin on third-party centralized exchanges, create one and list your token yourself. With many open-source free solutions available, you can open up your own exchange with your own coins in no time. However, having one is no guarantee that your token will receive the audience that you envision. 

Let's look at the pros and cons of listing on a third-party centralized or decentralized exchange. 

Pros and Cons of Listing on Third-Party Exchanges

Third-party or centralized exchanges make up 95% of crypto transactions. Newbies and rich crypto preneurs interested in having their coin prefer to list it on popular exchanges, such as Coinbase, Binance, Huobi, etc. But, for those who can't afford the luxury of paying to list their coins, listing on third-party exchanges would be out of the question. 

The biggest benefit of listing on centralized exchanges is that you don't have to bear the running costs. You only have to pay for listing your coin, but here is the catch, the money paid for listing is exorbitant. If you are dreaming of listing on centralized exchanges for free, know that it isn't possible, except you have something to give the exchange in return for listing your coin. This is usually not money. It could be your PR exposure or your crowd of followers. 

The downside of listing on centralized exchanges is that you have to pay a huge fee. This fee could reach as high as 50 BTC. This is not worth it, especially if you don't have a company that provides blockchain services. Another disadvantage is the vetting process. Getting your token listed on third-party exchanges requires a rigorous vetting process, and you have minimal control over the token after the listing. Lastly, many exchanges won’t help you market-make your newly listed coin, adding to another hidden cost when using a third-party platform for listing.

Pros and Cons of Listing with a White-label Exchange?

When people think of creating and operating their exchange, they imagine all the complicated processes involved, the time, risks, and the funds used to hire professionals to build it up from scratch. After all the analysis, they prefer not to undertake such a time-draining mission. 

But, this is far from the truth. Starting with a white-label exchange is as simple as creating a website with WordPress or WIX without any advanced skill level. You can use tools like ChainUp and HollaEx to create a crypto exchange. It's that simple. In summary, you can fork a suitable open-source codebase from HollaEx or Uniswap from GitHub and add your unique features to launch your platform

What about the cost? It costs less to build an exchange than to list on some centralized exchanges. Tools like HollaEx offer a complete crypto kit with a catalog of features that allows you to set up every aspect of your platform, including its trading fee structure for your own coin markets. You can then proceed to host your exchange on the cloud or locally. All these are free until you are ready to launch your exchange or the cloud or you could stay on the free DIY self-hosted version. By running your white label, you have complete control over your coin, distribution, and marketing. Plus, you don't need any KYC requirements to create your token. 

The biggest disadvantage with some white-label platforms is the market-making costs that can run anywhere from $20,000 to $50,000, depending on the number of new markets you have. Market making isn't typically included with the exchange software and is a separate concern that only applies to new coins and markets. There are market-making solutions but it is best to discuss that with your white-label provider. Operating and listing on your own exchange is still a better option than listing your token on a third-party exchange.

Things to Consider When Operating an Exchange 

If you've decided to start your exchange, you need to;

  • Find a solution and test it.
  • Make sure that your coin is in a straightforward format like ERC-20 for convenient addition to the exchange. Alternatively the BEP-20 and/or TRC-20.
  • Decide which marketing strategy to implement. Also, figure out if you will use a fixed price-broker system with no order book. Including an order book market is significantly more complex.
  • Figure out sustainable costs. Do you need all the features today? Ask yourself can you host the platform yourself or are required to pay for exchange hosting help.

How to List Your Coin on an Exchange

  1. Go to your exchanges admin control panel
  2. Add a or create your coin (if it is an ERC-20 token there should be a way to add the contract)
  3. Pair your newly added coin to another coin to create a market. This is often called ‘Create or add Market’ in your exchanges admin control panel.
  4. If your asset and market is brand new it may require auditing and verification to make sure the details are correct and are comfortable with the exchange system.
  5. Once activated and verified you should now have deposits addresses and withdrawals active on your exchange for the new coin as well as the new market.

Conclusion

For all those thinking of listing their coins, you need to seriously consider the cost-effectiveness of listing on a third-party exchange. Despite all the exposure, you may get by simply listing on a large well-known platform, it is often not enough over the long term and no more than a marketing gimmick for some projects.

You don't have to depend on third-party exchanges to list your coin when creating your own exchange. It may seem overly complex, but it can be a highly effective business strategy, especially if you reuse open-source code from HollaEx or even Uniswap as your white-label solution.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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