We present to your attention an interview with the founder and CEO of the Crypto Exchange btc-alpha.com Vitali Bodnar, how to create Crypto Exchange from scratch.
How did you know about the Cryptocurrency?
My specialization in education – physics, computer science, computer technology, I was constantly engaged in development. Somehow I accidentally read on the forum about bitcoin and began to understand the day, read everything about how it works.
How did you get into the Crypto industry?
It all started with the fact that I was wondering how the mining is going on. After figuring out the process, there was another problem – what to do with the coins that I minted. I took the money to the exchanges, which, by the way, were working terribly then. So I smoothly switched to trading.
Why did you decide that you need to create a Crypto Exchange?
This is due to my first failure. I, like any good trader, have a set of rules that I do not violate: I plan in advance the exit point from the position, I do not work when I’m under stress, I try not to fix the minuses, it’s easier for me to wait, I do not recoup in that the day when I’m going to minus, I just close my laptop and do not work. My failure happened due to stress, and at that moment I broke all the other rules. I went into a negative deal, closed it in the negative, decided to recoup. For a day, I conducted 10 operations with this scenario. I lost a few tens of thousands of dollars, which I earned over a very long time.
How did this affect the creation of the Exchange?
I began to analyze the situation and realized that a trader can earn, or lose money. But the exchange always remains in a prize. I realized that this is all quite interesting and that I want to create my own Crypto Exchange.
Let’s make 5 steps to create your own Crypto Exchange.
For me, the first thing is to “burn with the product.” To all my friends, acquaintances, strangers, I told everyone that I was developing Crypto Exchange and I needed a team, people, money, and everyone said that this would not work, but I had a crazy faith. All this was approximately in 2014-2015.
Since I had a positive reputation for developing projects, people immediately appeared who believed not in the cryptocurrency, not in the Crypto Exchange, but in me as a developer who can create a product.
Initially, I had an idea that you can take a ready-made base of Cryptoexchange, to modify it a little, and it will work. As with platforms for onlineshop. But such a product did not exist. Deepening into the subject, I realized that I want to write everything from scratch and understand everything in detail.
The second step?
Calculating the whole business model. At that time we used bitcoinwisdom – one of the first resources where you could see how the market is moving, and analyze everything for a day, a month, and see the volumes. For example, the exchange for a day conducted operations on 5000 bitcoins at a conditional exchange rate of $ 500. Exchange Commission – 0.4%. 500 is multiplied by 5000 and by 0.4 and we get a probable profit per day.
So, the business model for exchanges is quite simple?
Yes, I believe that if some thing is very complicated, then it will not work, only simple things work.
The third step?
Preparation of technical specifications. I must say that the initial technical assignment I created and the result obtained are fundamentally different things, for the reason that I did not understand a very large number of details, some moments that seemed to me extremely important were not important at all, and on the contrary. This is a standard story.
Tell me in more detail, how did you make the TS? Where did he get the information?
At that time, I traded on many exchanges and saw how DDoS attacks occur, saw how exchanges went bankrupt, saw when users were loyal to the exchange, and when they did not, and why it happened. I drafted the terms of reference from my experience, I made a product in which I as a trader would be comfortable. I wanted all operations to be understandable. I used the program to create an interface, where I drew 25 pages of the future site and built its logic. Moreover, all the Cryptoexchanges are basically the same.
How often did you use ready-made technical solutions?
I wanted to use to receive and send bitcoin blockchain.info. At that time, they provided a public API. At the initial stage, it seemed to me that it was sufficient to get the best possible product with minimal expenses, and then simply to improve and improve each item. But they denied us, without explaining the reasons. I think this is one of the most successful failures that happened. We decided to figure out how Bitcoin works, and wrote our client completely from scratch, which is now constantly improving. That is, we have our Bitcoin Wallet.
The fourth step?
This is the Team. I already had a well-coordinated team, with whom we worked on two projects. But I realized that we do not have enough experience to create a quality product in the cryptosphere. Therefore, we decided to pump our knowledge with additional tasks, for example, participated in the development of protection against DDos-attacks, services for receiving money, and so on. For three years we worked on the technical assignment and in parallel – on third-party projects to understand how everything works. Thanks to this, we also got acquainted with specialists who helped to further our project.
The fifth step?
The most banal is money. In the beginning, I was able to collect approximately $ 300,000. This is the year of the team of programmers, the minimum costs, but without regard to legal services. But it was in 2013. Now, I think, a minimum of $ 1 million is needed. We started in a different competitive environment and in other conditions, then there were only 5 stock exchanges, and now there are hundreds of them.
What is the geolocation of your users?
The whole world, but we now prohibit registration from America because of legal issues.
How many employees are involved in security?
If there is an urgent task, then the entire team is engaged in it, and no matter what time it happened.
Is there a bounty for finding vulnerabilities? And what?
The other day, paid bounty for finding the possibility of forgery e-mail administrator. In fact, they could not actually implement it, but it was theoretically possible to take advantage of this vulnerability.
And how much did they pay?
A few hundred, a small amount, since this is not a critical vulnerability. We have a list of costs for finding those or other vulnerabilities.
What are the main trading pairs on your exchange?
BTC/USD, LTC/USD, BTC/Monero, BT /Zcash.
How can I place my token on your exchange?
We have a section for adding coins, and it clearly indicates who we can add and who does not.
Thanks for the fascinating interview
Prepared by the CryptoRadio team