A crypto exchange is a complex ecosystem that has hundreds, if not thousands of different components interconnected. An exchange is a merging of technology and finance that not only requires experts from both but also exports in the budding field of blockchain based finance. Operating an exchange generally would require highly trained individuals, but all that is changing with pre-built crypto exchange white-label solutions that can be easily rebranded and customized to your business requirements.
What are the best crypto white-label services? You wouldn’t be visiting IBM or a bank for these services any time soon, instead you can find open exchange kits on GitHub, some of which are even free, so long as you have some tech know-how.
Alternatively, there are professional outfits that specialize in exchange services with exchange engineers that can quickly get your business connected to the blockchain at a service cost. But what are the costs? And what services are available that can be tested today?
The building costs involved for a typical crypto exchange can easily run into the hundred of thousands of dollars! Luckily, as mentioned, there are DIY exchange kits out there today that make building an exchange yourself in a low-cost way possible. These kits can easily be found by simply searching ‘open-source exchange software’. Typically these exchange kits come in preassembled parts and are designed to keep operational costs as low as possible. DIY exchange kits are best suited for small and medium startups and businesses but increasingly are being used for larger projects as the technology matures.
If more help and consultation is required there are professional white-label crypto service providers that can lend a hand at an extra cost. These costs depend highly on your exchange requirements.
So what are some of the best and most cost-effective white-label exchanges out there? First, let’s begin with why you would want an exchange in the first place.
Why even start a crypto exchange? Why use a crypto white-label?
First, public blockchains like the bitcoin blockchain are increasingly used in day-to-day life. It is almost preordained to grow, and so it is prudent for any business person to consider connecting their business operations to a blockchain if only just to stay ahead of the technology curve. This is why many large banks are offering blockchain assets to their customers and the way they do that is by outsourcing their blockchain tech to third-party services. If banks are now doing it then using a white-label provider with prebuilt exchange software is probably the safest and smartest route.
Second, we’ve already established that crypto exchanges are complex which makes security one of the most important but hard to verify aspects of any exchange software. Only by using a tried and true battle-tested white-label solution can you guarantee that your coins are safe. A good way to evaluate this for yourself is to check if it is open-source, that way you can get your tech team member to verify the software.
Simply put, using a white-label is an effective way of outsourcing operational complexity and guaranteeing security. It will also ensure that you get your business into a growing industry faster. Using a white-label exchange cloud will ultimately save teams countless hours micromanaging the repetitive day-to-day server management tasks that are typical of crypto exchange operations—leaving you free to focus on business.
From staking, lending, trading, and crowdfunding there are no limitations on what can be done with a crypto exchange.
Exchange white-label pros and cons
When using a white-label exchange service it is like hiring a specialized team of blockchain engineers. You get operational simplicity, tech updates, cloud-based hosting services as well as front-end support for different devices.
The benefits add up overtime and will result in:
- Long term savings
- Higher security
- Save on technology upgrades
- Fast to market
- Customizations and consultation (added cost)
That being said, white-label crypto exchanges are not without their issues. White-label services are typically mass-produced products and their standardized nature can make them hard to customize. Selecting the right white-label that still allows you to make changes is key. Otherwise, customization costs may run higher than what you paid for the software itself.
Here are some of the common issues but are highly dependent on your crypto exchange white-label solution:
- Variation in UI and UX can be limited as it is standardized.
- Counterparty risk using certain solutions.
- Difficult to test software without committing significant time
- Can be difficult to use and high learning curve.
- May have hidden costs.
An important thing you must check with any white-label exchange software is how the software handles blockchain fees. This is typically a pain point for users when withdrawing coins from the exchange and can even bleed money for your exchange business. The increasing blockchain fees are one thing every would-be operator will have to stay aware of. Testing the software for yourself with a real blockchain transaction is always the best way to learn how your exchange software handles network fees.
The best and most cost-effective white-label exchange
Fortunately, there are more and more affordable options for budding exchange operators, and if you know how to do basic web hosting or know some basic web programming then open-source exchange kits on GitHub will open up a world of opportunities.
If you aren’t tech-savvy or you simply want the fastest and most straightforward solutions then using HollaEx, an exchange cloud service provider is the way to go. It includes all the expected features of exchange and bakes them into a simple to use cloud plan that you can pay for monthly.
Running HollaEx is like using a website template and as long as you use the provided coins and UI it will operate without a hitch. It includes an automated matching engine for orderbook trading, a local or cloud hosting option, complete rebranding tools, bank or fiat payment plugin system, custom token adder, and a user-friendly back-end interface for managing everything. The cloud exchange plans are also highly economical and are flexible enough to upgrade or downgrade. The best thing about HollaEx is that it is open-source and free to test when you set it up yourself.
For those who prefer the white glove treatment solutions, Scalable Solutions can provide services beyond a typical exchange at an added cost. Or you can simply go with the most expensive service like AlphaPoint which will run at 5x to 10x times the cost of a typical DIY exchange kit but will have the added support and hand-holding experience that some teams may require.
So is it worth it?
As mentioned, the crypto industry is already a multi-trillion dollar industry that is rapidly growing. It is preordained to become the biggest industry in the world and having a part of it is a wise choice for any business savvy person.
Most white-label crypto exchange services are very tight-lipped about their coding so you never know what is going on in the back end. While claiming to be economical, they usually have hidden challenges and costs like compliance. If you want to go for a ready-to-go crypto exchange service it is almost always best to try it before you buy it.
Selecting the right white-label solution is probably the most challenging part and the costs don’t always correlate to quality in the crypto world. More expensive doesn’t always mean better. A cheaper white-label exchange that is open-source (thus secure), easy to configure, and stress-tested is usually the least risky way. You only need to invest some time learning how to set up your exchange.