Since its release, Bitcoin has developed so much that businesses now base their activities solely on this cryptocurrency. And this shouldn’t be surprising as the demand for this coin has increased, and we’re expecting its worldwide acceptance in the future. Of course, this has also contributed to the coin’s development, so you should check the bitcoin price today, as it’s a good investment time.
Regardless, Bitcoin is an excellent tool because it can boost your business. For example, business exchanges have increased lately as major companies started accepting bitcoin as an optional payment. The only challenge here might be that Bitcoin is still not fully regulated, and not all countries legally accept bitcoin transactions. However, if you want to start a Bitcoin exchange business, here are the steps you should follow.
As discussed, the only issue with Bitcoin is the need for more regulations and legal requirements. In some countries, such as El Salvador, Bitcoin has already become a legal tender, but the project needs to be clarified for the locals as their economy is already declining. The Central African Republic also approached Bitcoin as an official legal tender but has frozen the deal until further notice.
With these in mind, you need to thoroughly plan the Bitcoin business exchange because if you set it in a developing country where resources are scarce and people need time to get used to the technology, the proposal might fail. Therefore, getting legal counseling and ensuring all licensing requirements are met is necessary because a financial advisor will provide genuine tips and guidance on your business plan.
For your Bitcoin exchange to work correctly, you need to get licensed as a Money Transmitter business, follow SEC and CFTC rules, and adhere to the KYC (Know Your Customer) regulations, at least in the US.
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This step might be the easiest because, as a new business with high demand, you may be able to get funding fast enough to cover all your expenses. To start your Bitcoin exchange business, you might need around $135,000 only for the development and launch stages. Having a good financial plan for the future is also necessary because this is the only way you’ll face the market’s requirements.
As a startup, you need access to capital to allow a proper runway. So, be wary of getting licensing only from genuine crypto exchange providers. Otherwise, you’ll be charged ongoing fees, and they’ll fail to mention the legal obligations and cost requirements for maintaining your business.
You can get funding through the following:
- You can gather investors’ interest in your venture by providing unique digital assets;
- Initial Coin Offering (ICO). If you offer an ICO, you might be able to raise considerable amounts of funding;
- Accelerator program. Such a project offers you the necessary resources to develop your business prototype;
- Angel investors. If your project is interesting enough, angel investors might help you with funding and additional assistance;
Establish all technology aspects
The next steps include finding a technology solution provider and partnering with a payment processor. A technology solution provider is essential for auditing purposes, as regulators will inspect the full source code at some point. At the same time, the payment processor you choose will make the difference between a stable business and a failed one. That’s because many different models provide diverse fee structures, and to be competitive, you need the smallest transaction rates.
Finally, don’t forget about implementing the best security practices because this will help you avoid data breaches and other malware risks. The options for offline cold storage, two-factor authentication, and encrypted databases comprise the security base your Bitcoin business exchange must provide.
Finally, it’s time to go live via beta testing. Launching your project will ensure your business has completed the most important steps to getting closer to becoming a reliable organization for investors. However, you’re not done with the tasks yet. The next step is to start the marketing and PR campaign to get more coverage and get as many people as possible to use your Bitcoin exchange. You can look at what your competitors are doing and adopt a similar approach, but make it more personal and adapt it to your business’s goal.
The beta testing step is crucial to ensure that your service is in a feature-complete state. It also helps analyze potential holes in the system as the users participating in this process include your target audience, which should be helpful for you to get an idea of the performance of your final product.
Provide customer support
You need to consider your customers more and provide customer support services. This is the essential step in your customer retention process because it allows them to get help whenever needed, making them continue using your exchange platform. Of course, this means expanding your team or choosing a software product, but if you lack customer support services, your clients will leave as soon as they encounter a problem.
However, if you really don’t have the means or resources, you can at least create a particular page with questions and answers to the most fundamental issues people might encounter. You can also add some more on the way if you see that a problem persists.
Other methods also work for supporting your clients on their Bitcoin investing journey, such as setting up a compliant hotline, monitoring customer interactions or having a self-service procedure. Regardless, it’s best to have a friendly approach and understand that not all customers specialize in this domain, and they need a chance to learn more about investing in having a better financial life.
Starting a Bitcoin business exchange might be challenging. Still, since we’re in 2024, technology has developed, and more countries are adopting Bitcoin, your business should be welcomed, and you’ll get the funding you need pretty rapidly. As for legal implications, Bitcoin will soon become one of the first worldwide accepted coins, so don’t worry about your business flopping.