Is It The Right Time For Cryptocurrency Exchange Hub Of Multiple Cryptocurrencies?
What started with bitcoin now constitutes an entire industry. Today, the cryptocurrency market has more than 5500 digital currencies. Moreover, alongside the cryptocurrency market, its supportive infrastructure has also grown substantially. From multiple cryptocurrency platforms offering services of trading digital assets to different types of wallets for storing them- the space has literally exploded in the last few years.
But with multiple cryptocurrency platforms, how does a trader decide which is the best platform to buy cryptocurrency? Or which is the best cryptocurrency exchange to buy and sell bitcoin?
In this article, we have addressed the question that is gaining more and more relevance with each passing day. Is it the right time for a single exchange hub of multiple cryptocurrencies? Let’s dive deep into the details.
Cryptocurrency Platforms Infrastructure
While trading and investments within the market are gaining mainstream adoption, the process of cryptocurrency trading has become complex. Traders have to set up accounts on multiple exchanges and interact with various interfaces to place trades within the crypto ecosystem. Furthermore, different functionalities of each exchange have made the process increasingly cumbersome for traders.
The present cryptocurrency exchanges have restrictions in the form of coins available, payments supported, crypto to fiat trading or vice versa, and regulatory concerns. The process that should be straightforward, frictionless, and easy turns out to be complex, cumbersome, and inconvenient.
The Woes of Trading on Multiple Cryptocurrency Exchanges
Currently, there are more than 300 digital asset exchanges listed on Coinmarketcap. With the rising popularity of cryptocurrencies, the list keeps on growing. As the market is relatively new, the process of trading differs from that of traditional markets.
Currently, cryptocurrency exchanges cannot meet all the requirements of traders. Traders may not be able to access one or more services including trading pairs, payments supported, security features, etc. Depending upon their choice and requirements, traders create accounts on multiple exchanges in order to access different services offered by the platforms. This results in the complexity of having to manage multiple accounts and different functionalities.
These are the challenges traders face by having multiple accounts:
- Multiple KYC Processes: A trader has to undergo the standard procedure of verifying their identity, KYC as well as AML verifications if they want to trade beyond a certain limit.
- Order Books: Since orders are placed on multiple exchange platforms, traders have to individually manage their cryptocurrency investment portfolio which is segregated across various exchanges.
- Wallets: With some exchanges, traders have to create a separate wallet for each platform while others store a client’s cryptocurrency funds directly on their exchange. A trader needs to keep track of their tokens managed and stored on multiple wallets.
- Security: While platforms facilitating trading and investments in digital currencies are rising, not all of them encapsulate advanced security measures. If an exchange gets hacked, this can even result in a trader losing their funds.
- Multiple Interfaces: An investment manager, who trades in multiple digital assets with different trading pairs, needs to keep a constant track on which exchange offers the best price at a particular moment in time. In order to do so, a trader has to navigate between multiple tabs and adjust to a different trading interface each time.
- Arbitrage Opportunity– Millions of dollars are available as arbitrage opportunities on a daily basis. However, under the current cryptocurrency trading infrastructure, only an institutional investor can leverage this opportunity and generate profits.
Wouldn’t trading and investments in the cryptocurrency industry be much easier if there was a one-stop solution? Wouldn’t it be much simpler if a trader can manage their diversified portfolio encompassing multiple digital assets- all under one platform? Wouldn’t it be much simpler if a trader can access the best price of a particular cryptocurrency asset within seconds under one hub?
At the beginning of this article, we pondered upon this question: Is it the right time for a single exchange hub of multiple cryptocurrencies?
Well, we think you already know the answer!
Finxflo: One Platform-One KYC- One Wallet
A solution to the challenge has been created by Finxflo hybrid liquidity aggregator. Finxflo, a global cryptocurrency brokerage firm has designed a one-stop solution for traders. Finxflo’s users can access the optimum price of a cryptocurrency without navigating between multiple interfaces. By partnering with prominent cryptocurrency exchanges, Finxflo retrieves the best price of a digital asset at any given point in time.
Users are also able to manage their diversified digital currency portfolio consisting of multiple cryptocurrencies under one unitary portal. Finxflo enables a consolidated order book for traders and investment managers. With Finxflo, a trader has to undergo the process of identification proof and KYC only once. Traders do not need to sign up, remember multiple passwords, and follow the KYC guidelines individually for multiple platforms.
Finxflo: A Cryptocurrency Exchange Hub
Finxflo also offers one wallet for traders to store all their crypto assets. The MPC encrypted wallet is protected with advanced security measures. By partnering with Fireblocks, a leading platform in cybersecurity, Finxflo ensures that a client’s funds are completely insured. Finxflo is a regulated entity under the Monetary Authority of Singapore (MAS) in order to create a seamless trading environment along with ensuring the highest level of security.
In addition to its USP of One platform- One KYC- One Wallet, Finxflo also facilitates innovative trading tools catering to retail as well as institutional traders. Some of these include smart order routing and dark pool liquidity. Finxflo offers a transparent and straightforward trading environment with security measures as the very base of its foundation.
With the rapidly growing cryptocurrency industry along with its mainstream adoption, there is a need to scale the industry’s infrastructure services. A platform like Finxflo is a step towards that direction. With institutional participation, hedge fund managers, and investors diversifying their portfolio by including crypto assets- it is certainly the right time for a cryptocurrency exchange hub that acts as a gateway to multiple cryptocurrencies and its subsidiary products.