The world is moving at a fast pace towards the FinTech ecosystem where cryptocurrency exchanges are an integral part, having BTC exchanges being the most popular. Several factors contributed to the growing popularity of cryptocurrency development, such as instant settlement, quick accessibility, minimal conventional business opportunities after the financial crisis of 2008, and a shift towards the digital ecosystem.
Keeping the above scenarios in mind, in this blog we will unravel the journey to begin with bitcoin exchange platform development. First and foremost, let us comprehend what bitcoin exchanges are.
What are bitcoin exchanges?
Bitcoin exchanges are software that enable users to trade their bitcoins with different fiat currencies or altcoins. It provides an opportunity to crypto traders to convert their fiat currency into crypto currency and vice versa. Bitcoin exchange software should be fortified with market-leading features to enable quick, transparent, and authenticated transactions.
The architecture of a bitcoin exchange
The architecture is the framework that defines the structure of a system and provides an explanation of how it behaves. The following are the five most important elements that cover the architecture of a bitcoin exchange:
Trade matching engine
One of the important components that is taken into account during bitcoin exchange software development is the trade matching engine. It matches up buy and sell orders and executes transactions with the minimum latency. The trading matching engine is the neural schema of a bitcoin trading exchange, and it can’t be neglected.
The user interface is the medium through which a user interacts with the system. A self-explanatory interface is easy-to-understand and enables users to seamlessly navigate through the platform, thereby providing great user experience.
Another main component of a bitcoin exchange is the cryptocurrency wallet. Every single crypto asset that is transacted passes through a wallet that is attached to the server of the bitcoin exchange. They don’t truly hold the funds but help to establish a connection through which a user can interact with the blockchain network. It consists of the public and private keys of a user; hence the security measures can’t be compromised at this tool.
There are two forms of wallets, including hot wallets and cold wallets.
Hot wallets are any wallets that are connected to the internet. The wallets are directly linked to their respective bitcoin exchange, making the funds quickly accessible to the traders.
On the other hand, cold wallets or offline wallets are the ones having no connection to the internet. They are more secure as compared to the hot wallets and they are invulnerable to hacking. As they are not linked to any trading exchange, the custody of the user funds remains with the user only.
The admin panel, also called as the control panel, is an interface used by the service owner to make any manipulation to the software, keep a track of the business transactions, users, KYC, and to follow the business metrics (KPIs). Multiple admin and sub-admin can be created for a platform, segregated by the privileges to access or see the platform.
The bitcoin exchange requires possessing all the necessary market-leading features, such as:
High TPS (Transactions per second)
Geography-based KYC/ AML verification
Referral and Reward Program
How to develop bitcoin exchange software
By now, you must be aware of what it takes to build bitcoin exchange software. You can either leverage a white label bitcoin exchange solution to build your Bitcoin exchange or develop a custom platform from scratch.
At Antier Solutions, we offer business-oriented services to navigate your Bitcoin exchange development journey. Whether you need a white label exchange solution or want to build a custom exchange from ground zero, we deliver customized solutions to help you accomplish your business goals.