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How Young Crypto Exchanges Compete with Market Giants

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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.

Altcoin News, Bitcoin News, Blockchain News, Cryptocurrency news, News

Author: Andrey Sergeenkov

Founder and editor at BTC PEERS. Andrey writes about financial experiments, DeFi, cryptocurrency, and blockchain.



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Coinbase S1-Filing with US SEC for Direct Stock Listing Goes Public

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In the S-1 filing, Coinbase has made crucial disclosures to the public with its plans of launching direct stock listing on Nasdaq. As per its recent valuations, Coinbase pegs a value of over $100 billion.

Crypto exchange Coinbase is inching closer to its direct stock listing on Nasdaq. On Thursday, February 25, Coinbase submitted its S-1 filing with the US Securities and Exchange Commission (SEC), thereby making it public for the first time.

The recent submission is a crucial step for Coinbase’s direct stock listing on Nasdaq. The S1 filing with the SEC offers a deeper insight into Coinbase’s business. All the disclosures effectively work as a pitch to the investors. Before this, Coinbase submitted its confidential draft document to the US SEC in mid-December.

The rumors of Coinbase’s public listing first emerged during last summer of 2020. Over the last few weeks, Coinbvase has been releasing its shares in the secondary market to investors. As per its latest share offering, Coinbase’s valuations spiked above $100 billion with a per-share price value of $373. The official blog post for Coinbase notes:

“Coinbase Global, Inc. today announced that it has filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission (the “SEC”) relating to a proposed public direct listing of its Class A common stock. Coinbase intends to list its Class A common stock on the Nasdaq Global Select Market under the ticker symbol “COIN”.

Coinbase has confirmed that it will take the help of Goldman Sachs, JPMorgan Securities and Citigroup to “assist us with respect to certain matters relating to our listing.”

Coinbase’s Strong Growth Story

Over the last two years, Coinbase has registered strong growth with a major spike in the customer base. By the end of 2018, Coinbase valuations stood at $8 billion and have multiplied 12x by now. As Coinbase noted:

“We have grown quickly and in a capital-efficient manner since our founding. For the years ended December 31, 2020 and December 31, 2019, we generated total revenue of $1.3 billion and $533.7 million, respectively, net income (loss) of $322.3 million and $(30.4) million, respectively, and Adjusted EBITDA of $527.4 million and $24.3 million, respectively.”

After registering a $30 million loss in 2019, Coinbase reported $322.3 million net income as its first positive year in 2020. However, Coinbase has noted that as it expands its operations, its expenses will continue to grow simultaneously. The crypto exchange said:

“We expect our operating expenses to increase significantly in the foreseeable future and may not be able to achieve profitability or achieve positive cash flow from operations on a consistent basis, which may cause our business, operating results, and financial condition to be adversely impacted”.

Other business news can be found here.

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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.



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Nash: Bridging Gap between Fiat and Crypto

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Nash Link is a solution for merchants to accept cryptocurrency without setting up a blockchain wallet.

Nash specializes in providing the best fiat/crypto gateway services for both retail and business customers, combining the lowest prices and fees with high-security wallets. This exchange service is fully licensed to operate in Europe.

For BTC, ETH, NEO and USDC, Nash offers 0% fees. This is possible because Nash operates its own crypto-crypto exchange. Nash’s unique Layer-2 exchange provides the same performance as centralized exchanges without taking custody of funds.

For other crypto assets, tradeable on Layer 1 user wallets, Nash charges just 1% fees, with no hidden slippage fees.

What’s more, Nash provides the safest software wallet by using secure multi-party computation (MPC) technology. MPC ensures a user’s full private key is never used to sign transactions and allows for security policies like address whitelists. Nash never has control over user funds.

On the business side, Nash offers its fiat gateway services as a white-label solution for third parties. Fees remain as low as 1%, with no tricks like huge asset mark-ups. Nash is a highly competitive solution for projects seeking a licensed fiat gateway for their platform and token.

Nash Link is a solution for merchants to accept cryptocurrency without setting up a blockchain wallet. Nash pays merchants the exact fiat price they set in their preferred national currency (€, £ or $) with 0% fees, managing risk around price volatility This is also possible thanks to Nash’s Layer-2 exchange.

In 2021, Nash will expand into digital banking services. High-interest DeFi-staking products will go live in Q2. In Q3, Nash will offer national currency checking accounts (with IBANs) on its platform. These will enable an even simpler savings product where users can easily deposit cash and lock it in a DeFi-powered crypto savings account. With a debit card arriving in Q4, Nash will seamlessly integrate traditional and crypto finance by the end of the year.

Altcoin News, Blockchain News, Cryptocurrency news, News

Please check out latest news, expert comments and industry insights from Coinspeaker’s contributors.



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Federal Reserve Wire and ACH Systems Back Online after Outage Affecting Exchanges

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Some other services offered by the Fed were also disrupted some of which include, FedLine Advantage, FedLine Command, FedLine Direct, FedLine Web and FedMail.

For an hour, the Federal reserve wire and ACH systems were down. During the Wednesday downtime, a number of US-based crypto exchanges was affected.

The systems allow the Fed to send wires and settle the transactions in real-time. Fedwire offers real-time settlement across accredited institutions. Gemini and Kraken reported delays in Federal Reserve wire and automated clearing house transactions. But the severity of it was much greater as no bank was able to send or receive wires. During the downtime, many in the crypto community were quick to point out that Blockchain could serve the same purpose without ever experiencing a downtime period. In line with blockchain, it was also a perfect moment to sell Bitcoin as the best form of money.

Some other services offered by the Fed were also disrupted some of which include, FedLine Advantage, FedLine Command, FedLine Direct, FedLine Web and FedMail.

At the time, the Fed in an effort to curb panic was quick to comment on the failure. Jim Strader, Richmond Federal Reserve spokesperson stated:

“A Federal Reserve operational error resulted in disruption of service in several business lines. We are restoring services and are communicating with all Federal Reserve Financial Services customers about the status of operations.”

The Fed in a few hours had restored all but Account Services. During the disruption, neither the dollar nor Bitcoin seemed to react. There was also no major impact on any bank or exchange during the outage.

Federal Reserve Calls for Digital Currency Clarity

On the same day of the outage, the Fed was reigniting interest in issuing a digital currency. The US Federal Reserve Chairman Jerome Powell stated that 2021 would be the year for broad consultation with the public about a potential CBDC. In FED notes outlining some ‘preconditions’ on any potential digital currency, the body noted;

“Engaging with individuals and businesses and consulting with consumer groups, community organizations, and business associations to understand the use case for a CBDC will help in the decision whether to issue a CBDC and its potential design,”

The paper further noted that the senate had a big role to play, with any potential issue of a CBDC having to be on a “legislative authorization.” Features of the digital dollar were also key with interest in privacy, security access and delivery. The notes however failed to report if the digital currency would be blockchain-based or not.

The Feds stance comes just a week after Treasury Secretary Janet Yellen talked about a digital dollar being feasible. She further pointed out that with too many Americans lacking access to payment systems and bank accounts, a CBDC would be ideal.

FinTech News, Market News, News

Kiguru is a fine writer with a preference for innovation, finance, and the convergence of the two. A firm adherent to the groundbreaking capability of cryptographic forms of money and the blockchain. When not in his office, he is tuned in to Nas, Eminem, and The Beatles.





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