If you were to be an exchange one day, what would you do?
[This article is organized by mkz888z, if you have any questions about project incubation needs, please feel free to communicate! 】
Since the rise of cryptocurrency, exchanges have become vital products in the industry. There was also explosive growth in 2018. After experiencing bulls and bears, the exchange's product business is also experiencing some of the experience it should have in the product growth cycle. Today, we regard the exchange as a product and talk about the product logic and product thinking of the exchange.
The nature of the exchange
The exchange is the carrier of secondary market transactions. After the emergence of cryptocurrency, individual-to-individual transactions appear. It is definitely inconvenient to pay with one hand and play with the other hand. In order to facilitate transactions between Bitcoin holders, the exchange has made Bitcoin can be purchased on the platform, and every purchase is actually a person-to-person transaction, but the same platform makes it more convenient to buy and sell.
Therefore, the goal of the exchange is to realize convenient C2C transactions among currency holders. The trading pairs of the exchanges we see now are convenient for exchange between currencies, and the selling and buying pending orders seen in the transaction are for matching Transactional.
Each currency trading pair is like a commodity. The currency of the project party is listed on the exchange to sell a certain amount of currency issued by the project party on the exchange to users, and then users can freely place orders.
So the question is, as an exchange, the goal is ultimately to become profitable. In order to maximize profitability, it needs to operate.
The needs of the exchange
We only locate the target of the exchange based on the user's transaction needs, and the transaction fee charged by the platform is to provide users with the benefits of these needs and is also the main source of profit.
In the case of a fixed transaction fee charging ratio, the exchange must encourage users to conduct transactions to the greatest extent, which is the most basic operation for charging the fee. There are two ways to achieve more transactions: 1. The transaction volume of currencies increases; 2. The number of currencies increases.
If the currency is regarded as a commodity, that is, the two main ways that the unit price of the commodity is high and the quantity of the commodity is large. A currency with a good trading volume must be a project token with a good financial strength or development potential in the market. What this requires is that the exchange can find a good currency and list it on the exchange, and then continue to increase the number of currencies.
Here we need to understand the exchange listing. We mentioned earlier that the listing of the exchange or the project is to sell the tokens on the platform in the form of pending orders, and then freely trade, or currencies like Bitcoin. The species itself is directly purchased through OTC or USD trading pairs, and then freely traded.
The source of these transactions requires currency holders to place orders on the platform, which is the first step in buying and selling transactions. Therefore, for many projects that have just been listed on the stock exchange, or projects that have not yet been funded, not all exchanges can get tokens to start trading.
Based on this, we can see that if the exchange wants more revenue, it still has to create transaction volume. For users, is there a need for reciprocity?
The needs of cryptocurrency investors
Since an investor makes an investment, it must be profitable and profitable. Therefore, there are several important conditions for investors to choose to trade: 1. There is a currency with investable value; 2. The handling fee is lower; 3. It is convenient for users to exit multiple transactions; 4. The experience is better.
First of all, the cryptocurrency market is changing rapidly. Whether a corresponding currency has investable value requires professional judgment. The corresponding judgment comes from fundamentals and indicator data. The fundamentals include project trends, project evaluations, etc. Therefore, we see When the project party performs various actions, it is also a positive meaning for the project token. In the bull market, there have been cases where a large number of unprofessional investors suffered losses based on fundamental investment, which shows that comprehensive judgment is important in the investment process. [This article is organized by mkz888z, if you have any questions about project incubation needs, please feel free to communicate! 】
This is related to professional secondary market indicators. There are many professional secondary market indicators. Through the changes of indicators, what needs to be done is to confirm the information disclosed in the market. The candlesticks of many currencies have an upward trend, which is investment. The investment opportunities that people look forward to. This is related to the market value management team and the quantitative team. When the currency is not deep enough due to the sluggish market, the market value management team and the quantitative team will promote the currency to form a normal volatile K line through transactions, so that investors who enter can do more transactions. operating.
Other lower handling fees are the way for many emerging exchanges to gather users. With a large number of users and withdrawal of transactions, it is also affected by the problem of small transaction depth. If you buy a lot of tokens but cannot sell them all at high points, then It means it is difficult to withdraw. The final experience involves the app or web response speed, internet speed, data update, whether the transaction is stuck, etc.
Why are there platform coins and IEO
The emergence of the platform currency is explained in the form of equity dividends in the industry. In the product logic, the token is the coexistence of the user and the platform, which will effectively promote the subconscious dependence on platform transactions. At the same time, the platform currency is also an important one. Increase the trading depth of the currency.
More importantly, after the emergence of platform currency, the exchange has changed from a third-party platform that relies on fee income to a financier. The greater liquidity of transaction funds also means that there will be greater profit margins.
The IEO boom that emerged in 2019 is itself designed to stimulate users' desire to invest and drive the market to become active. The IEO uses the preferential fund-raising quota to more clearly show the user its future earnings value, which is enough to allow the funds that have been dormant in the bear market to enter the platform, and finally trigger a large number of transactions while completing the fundraising of the project.
Token type and depth are the core
From all the analysis, the core of what the exchange should do is to have more types of tokens and better transaction depth. There is no doubt that each project party will push its own currency, and If the exchange can quickly select and go online in the endless stream of tokens, there will be an increase in users and transaction volume. In the cryptocurrency industry, letting users invest in profit is the best way to attract users. This is not the Internet. App usage habits can play a role
Well-known tokens represent a large profit margin, and transaction depth represents a small transaction risk. That's it.
[This article is organized by mkz888z, if you have any questions about project incubation needs, please feel free to communicate! 】