Bitcoin is trending as the most profitable and prominent cryptocurrency in market capitalization. Moreover, this virtual money has a higher-returns potential and is risky as it has its share of profits and losses. Many early Bitcoin investors who did not view this electronic currency as a scam are now millionaires and billionaires. With the best trading tools, quick payouts, and outstanding customer service, Immediate Edge trading platform will help traders on their bitcoin journey.
Therefore, more and more people are joining the Bitcoin world. Exchange platforms that help people trade, purchase or sell this electronic currency are recording many users joining the exchange platforms. So, here is how you can start a Bitcoin trading business.
Obtain Reliable Legal Counsel
There are various requirements each new venture requires. Therefore, before you plan your business, it is vital to seek legal counsel to understand the regulatory demands for that specific venture. You must obtain the proper licensing in all jurisdictions where your trading business plans to operate thoroughly. These digital money trading businesses operate primarily without significant oversight since government and regulation have yet to catch up with the technology.
On the other hand, when starting your Bitcoin trading business in the U.S., these digital money operators should be licensed Money Transmitter businesses. They must follow SEC rules and regulations, among others. Proper and adequate legal counsel is a must requirement. Brokerages must also adhere to Know Your Customer regulations, which have become increasingly prevalent to combat money laundering. Moreover, laws vary by jurisdiction, so consult an attorney familiar with the industry.
Get Funding for the Business Venture
Before starting this digital money business, you should know the approximate costs involved. For example, to develop and launch your Bitcoin trading business, you will need a minimum amount of $140,000. This amount includes the cost of technology, hosting, initial legal counsel, registration, and advertising.
On the other hand, while business owners only need part of the amount upfront, ensuring the business venture has access to enough capital to ensure a proper runway is vital. One major mistake made by start-ups is that they need to plan accordingly for the future. Therefore, these start-ups will land small initial raises, covering the development costs but leaving the venture without the necessary operational cash until it becomes profitable.
Also, start-ups make the mistake of licensing unscrupulous Bitcoin exchange providers who charge ongoing fees and don’t mention the legal obligations and costs one requires for setting up and maintaining the trading business.
Look for a Technology Solution Provider
Get a reliable technology solution provider with a one-time license fee without commissions or royalty structures. In other words, the technology solution provider should not include any hidden charges. Therefore, traders can host the exchange themselves, and clients receive complete source code, which is vital for auditing since some regulators insist on inspecting the source code.
Link Your Exchange With Others for Added Liquidity
A great exchange should offer better liquidity. Also, many potential clients will view your new start-up with skepticism without an order book and trading activity. So, to avoid these issues, without the need to simulate movement via dummy accounts within the recent trading business, you can connect your brokerage to a network of existing brokerages, enhancing liquidity. Keep in mind that the more extensive the network of brokerages, the less liquidity will be a challenge for your new brokerage.
Final Thoughts
Starting a Bitcoin trading business is easy with the help of the above guide. Therefore, consider the above tips, including creating a marketing and PR campaign to grow a successful Bitcoin trading business.