Why is now the time to start a crypto exchange? World markets are in turmoil.

by PRC Agency PR

Part 1 - Market Overview

The crypto market, despite what you might have heard, is booming.

The current bear cycle is due to global macroeconomics - caused primarily by institutional and bot traders, and bandwagoned by retail investors.

It’s that last demographic that matters.

Regardless of price action - adoption is rising. 300 million people (0.4% of the global population) have exposure to the market, and that number is growing.

Despite this, there are just 600 cryptocurrency exchanges in the world right now - profiting from volatility, not price action. Every deposit, withdrawal, trade, loan, and liquidation makes them money.

An exchange with about 5000 users trading 1000USD per month has a max potential monthly revenue of $5M. Accounting for inefficiencies, that number comes down to about $1.6M… Still a hefty sum.

So why are there so few exchanges? Two reasons:

Inability to develop a robust, secure, and scalable platform

Insufficient capital to maintain liquidity

These two things are giving incumbents the market edge.

Part 2 - Recipe for Success

Let’s suppose a marketing team acquired a fully functioning exchange. Their technical and capital needs are met - how do they market it?

Let’s put you in the shoes of this imaginary marketing team.

Your first priorities would be:

Branding

USP

Brand Image

Market Positioning

Growth strategies

Social Engagement

Content Marketing

Community Management

Affiliate Marketing

Gamification

Data Management

Part 3 - Branding

What makes your exchange special? Identifying this results in effective branding. Latch onto your USP. Speed is key - in the rapidly evolving industry, copycats appear fast - affiliation with a feature, slogan, mascot, or ideology cements your place in the field.

Remember, only 0.4% of the world’s population trades crypto - engaging the other 99.6% presents opportunity and challenge. Their lack of trust is equal parts due to understanding of the pitfalls, and misunderstanding of the benefits of exposure to this market. If you’re trying to acquire new users, your branding and promotion needs to bridge this gap by making cryptocurrency feel accessible.

This will inform your market positioning. The veterans of the industry have found theirs. It’s important not to overstep your bounds, lest you ruffle the wrong feathers and wind up in direct competition with an incumbent giant. Uniqueness is the key to success.

Part 4 - Growth

Once your house is in order, you can invite people in. Growing a cryptocurrency exchange requires careful reconsideration of marketing strategy. This industry has grown fast and developed a subculture - it’s vital to adopt the lingo, but not at the expense of untapped markets, who may not be privy to industry terms.

Social engagement, therefore - includes equal parts technical and layman’s terms. It’s far easier to convert somebody than to convince a current user to adopt your product. Focus on fresh users when developing your strategy, copy, and design.

Similar principles apply to content marketing. In cryptocurrency, there’s a ‘content problem’ - The majority of users have no idea how it works, and the ones that don’t have even less of a clue. The solution is education, and it works wonders for marketing.

Binance is a great example of content marketing. They’ve invested in product documentation & blockchain-specific educational resources. This has become an invaluable funnel for user acquisition because they’re owning simple questions - positioning themselves as an authority, and keeping their brand top of mind.

Once your early marketing takes hold, you’ll have a user-base. This is your most precious marketing resource, because there’s nothing like word of mouth. There are two ways to leverage this - community management, and affiliate marketing.

Building a community has an interesting benefit: free technical support. Gather users of varying expertise and they’ll organize themselves into two groups - experts, and laymen - sharing information amongst themselves.

This spills into affiliate marketing, where you reward experts for their work by offering in-app bonuses for recruitment. This reinforces their sense of community and positions them as leaders.

Another popular affiliate marketing method among top exchanges