The orders are checked against the orders of other users on the platform and allow the exchange to execute the trade. There is an exchange fee for every transaction done on the platform.
Crypto Exchange Listing
Cryptocurrency exchange listing is the process of adding new cryptocurrencies to be traded on a specific exchange platform. When a cryptocurrency is listed on a particular exchange, it becomes available for the users of that exchange to buy, sell, and trade. The process of listing a cryptocurrency on an exchange could vary according to the procedures and regulations set by that exchange.
Normally, the exchanges have certain criteria and regulations. Cryptocurrencies have to obey those regulations. These criteria include factors such as the project’s authenticity and credibility, technology, market demand, liquidity, and compliance with legal and regulatory frameworks. To be listed on an exchange, crypto projects have to go through an application and review process.
Process of Crypto Exchange Listing
Cryptocurrency listings typically go through separate processes to get listed on different platforms and exchanges. Cryptocurrency exchanges can try listing various cryptocurrencies on their platforms instead of themselves alone.
Step 1: Application
Crypto projects intended to be listed on an exchange usually start by submitting an application to the same exchange. The application will have detailed information about the project, including its objectives, technology, team members, analysis of the market, and legal compliances.
Step 2: Due Diligence
The staff at the exchange will conduct a thorough evaluation of the crypto project. They will assess factors such as the project’s authenticity and credibility, market demand, technology, team members’ expertise, liquidity, community support, and regulatory compliance.
Step 3: Listing Fee
Most of the exchanges charge a specific listing fee to cover the costs incurred for reviewing, listing, and maintaining cryptocurrency on their platform. This fee varies according to the concerned exchange and the level of exposure and services given. The listing fee is often finalised between the exchange and the crypto project.
Step 4: Technology Integration
Once the cryptocurrency project passes the evaluation and agrees to the listing conditions, the exchange will begin the technology integration process. This includes integrating blockchain or cryptocurrency technology into the exchange’s infrastructure. Exchanges typically provide guidelines and support for crypto projects for a smooth integration process.
Step 5: Market-Making and Liquidity
As cryptocurrency gets listed on the exchange, liquidity is required for trading activity. Some exchanges may require market-making services where designated market makers provide liquidity by managing buy and sell orders on the order book. Market makers ensure that there are enough buyers and sellers to facilitate transactions and maintain price stability.
Commencement of Trading
Once the technical integration and liquidity provision are completed, the newly listed cryptocurrency will start trading on the exchange. Users can buy, sell, and start trading cryptocurrencies based on the exchange’s trading pairs and available order types.