Users expect exchanges to find a balance between trading experience and security. An average trader requires a secure, fast, compliant, and flexible trading terminal.
Blockchain and the tokenization of assets are changing the world as we know it. From logistics to entertainment, hospitality, and healthcare, this nascent tech is redefining the foundations of several industries.
Through the tokenization of assets, blockchain technology is enabling a new wave of borderless transactions free from third-party intermediaries. Put differently, anyone across the globe can transfer funds instantaneously and at minimal fees. Primarily, blockchain is disrupting the financial ecosystem by making it more democratic, accessible, and efficient.
According to Johannes Höhener, Head of Fintech, Swisscom Digital Business, “digital assets are the financial instruments of the future. They are tradeable on a more granular basis and enable more differentiated portfolios.”
The implications of a tokenized economy are quite immense. In addition to seamless money transfers, asset tokenization allows for fractional ownership to a much broader pool of investors. To this end, any valuable asset can be tokenized – from blockchain issued currencies to government-backed digital currencies, securities, commodities, and contracts, amongst others.
Data on CoinMarketCap reveals that there are over 8,000 digital assets. This number is an indication of how widespread the concept of tokenization is becoming.
What do Users Expect?
In order to buy or sell tokenized assets and cryptocurrencies, people turn to exchanges. Although the crypto exchange market has had its fair share of setbacks, the onus is on new and existing platforms to understand the pain points of trading cryptocurrency and solve them. Users expect exchanges to find a balance between trading experience and security. An average trader requires a secure, fast, compliant, and flexible trading terminal.
That said, there are not enough crypto exchanges out there with the infrastructural resources to meet the needs of the growing community of crypto traders. More so, new exchanges have not had as much impact as you would expect of a competitive landscape. Very few have managed to put together formidable crypto exchange services. Unsurprisingly, this has hurt the innovative rate of the crypto exchange sector.
In a bid to understand the limitations that new exchanges face and how they could navigate them, we decided to use the emergence of Binaryx, an Estonian-based crypto trading platform, as a case study. Binaryx has excelled where others have failed. Therefore, it is only fair that we investigate how it has attracted and retained users successfully.
The exchange platform combines several exciting features to provide the best trading experience for both professionals and non-professionals. Some of its dominant features include:
- A scalable trading terminal interface for novice and pro users.
- An academy comprising an expert community.
- Award-winning lean design
- Responsive and flexible support
What Are the Problems Young Exchanges Face?
Liquidity is a recurring issue for young exchanges. They must find a way of providing fluid and sustainable trading services without distorting the prices of cryptocurrencies. This is an issue that is also prevalent in some established exchanges. And so, there is even more pressure on young exchanges to identify innovative ways to tackle them.
On the subject of liquidity, which is a core challenge with most small exchanges, Binaryx relies on several techniques to solve this problem. In addition to its own liquidity pool, Binaryx relies on liquidity providers to supply the relevant data to allow the exchange to feed its order-books. Furthermore, Binaryx gains liquidity from other exchanges through APIs.
After dozens of fraudulent schemes hiding behind the signboard of crypto projects, users started to pay special attention to the legal component and transparency of startups. Binaryx approached the issue seriously – the company is registered in Estonia and has all the necessary licenses, which allows it to operate in accordance with the laws of the European Union and ensure legal transparency.
Considering the number of crypto exchange hacks that have happened in the last decade, the importance of security cannot be overemphasized. To an average user, ease-of-use and security are arguably top on the list. Also, it stores a significant percentage of users’ funds in cold wallets. This is in addition to fiat backups in different bank vaults across the globe.
How Do Young Exchanges Manage to Compete with Major Competitors?
Having understood the challenges that new exchanges face, we thought it wise to unravel Binaryx’s secret formula to successfully establish a new company in a cutthroat industry. The CEO Oleg Kurchenko revealed that the platform had implemented a wide array of solutions to eliminate the challenges associated with running a newly launched crypto exchange. Below are some of the implemented features.
- Binaryx is committed to protecting users from attempts to exploit clients’ vulnerabilities: multi-level access to all vital components, 2FA, anti-phishing code
- Award-winning lean design ensures user’s convenience
- Publicity of founder and team and access to all necessary legal information to guarantee a highest level of transparency
- Its offices in Ukraine and Estonia come fully fitted with the ideal security provisions, including the latest technologies.
- Fast and simple registration process, that requires only a few minute.
According to Kurchenko, the combination of these implementations has helped Binaryx carve a name for itself in the crypto exchange sector. “We knew before the launch of Binaryx that we had to adopt an innovative approach to crypto trading to stand a chance of competing in the big leagues,” Kurchenko stated. “Therefore, we are leaving no stone unturned in our quest to deliver an intuitive and efficient trading platform for our community of users.”
Competing with the big players, young exchanges are forced to offer users experiences that the big players cannot provide. Most newbies prefer the more established platforms, but smaller platforms can often offer a more flexible experience that is more tailored to the needs of the user. Due to the highload, many major exchanges are experiencing technical problems, which causes users to lose their money. That is why there is a tendency to move to smaller platforms that can ensure the stable operation of their products.
Founder and editor at BTC PEERS. Andrey writes about financial experiments, DeFi, cryptocurrency, and blockchain.