White Label Trading Platform (Software) - Merehead (2024)

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In this article, you will learn how to create your own White Label solution for launching trading platforms, what is needed for this, and cost to build a crypto exchange. We will also tell you how to monetize such projects.

Type of platforms

A trading platform is software that allows you to buy and sell various assets in the financial markets. Such assets can be fiat currencies, cryptocurrencies, securities, precious stones and metals, commodities, insurance policies, NFTs, access to something, etc.

When creating a white label to launch a trading platform, you need to decide:

• What exactly can be traded on your site. Usually, according to this criterion, sites are divided into traditional (Forex, securities, raw materials, precious metals and stones) and cryptocurrencies (Bitcoin, Ether, Litecoin).
• How exactly the trading will take place on your platform. You can create a white label to launch market makers, STP or ECN brokers. If you are focused on cryptocurrency, then you can also consider developing a white label to build decentralized exchange.
• What platforms your software will run on. It can be a desktop program, a web interface, or an Android and iOS application. Of course, the more platforms that support your white label, the better, as this increases the reach of your potential target audience.
• How to monetize your white label solution. It's about how you will sell it: one-time payment, subscription, commission on deals, sale of premium features. And how your licensees will earn: subscriptions, commissions, ads, paid features, tips, markers or services.

Let's look at the main types of trading platforms:
Forex. Typically, such software is used by brokers. Users have the opportunity to trade stocks, currency pairs.
Decentralized (cryptocurrencies). Platforms provide an opportunity to trade cryptocurrencies with a high level of security and anonymity. In fact, the user can change one cryptocurrency for another using their wallets (Metamask, Trust Wallet, etc.). The most popular such platforms are uniswap, pancakeswap).
Spot (cryptocurrencies). The centralized crypto exchange software makes it possible to buy and sell cryptocurrency. It has a glass of orders, liquidity and a user's wallet inside the platform.
Margin (cryptocurrencies). This type of platform allows users to trade using a loan. This provides more profit, although on the other hand there are more risks.

Margin trading (Binance)

Derivatives (cryptocurrencies). One of the most popular type of platforms that allows users to trade with leverage. First of all, the lure of high income attracts inexperienced traders to use derivatives (mostly futures) for trading. But behind this lies a huge loss. According to statistics, over 95% of users lose their entire balance when using leveraged trading.

Target audience

Next, you will need to do some market research to understand what your potential customers and their target audience need. If you have the appropriate knowledge and skills, then such an analysis can be carried out independently. If there aren’t any, this task can be outsourced to a marketing agency or a full-cycle cryptocurrency exchange development company such as Merehead.

Here's how to find out what your customers and their target audience need:

• Analysis of open data. This implies the study of survey results, market research and statistic data that someone else has done and made publicly available, for example, on the Statista website.
• Conducting surveys, focus groups. If you know exactly what the target audience of your clients is, you can directly ask them what they expect from the trading platform, what they dislike about the solutions existing in the markets, what would motivate them to use your software, etc.
• Use user personas. This is a generalized but realistic description of a typical user of the product, that is, an archetype, not a real living person. The person contains demographic data, habits, fears, desires, goals, etc., focusing on which professional marketers and developers can create a product that will appeal to the target audience. Use this tool when creating a white label trading platform.

Functionality

White label functionality can be divided into two separate groups. The first is the capabilities that will enable your clients to launch and manage a trading platform. The second is the functions through which end users will buy and sell financial assets using your software.

Here's what you need to launch trading platforms:

• Trading engine. This is the backbone of any trading platform. The trading engine collects all the data into one mechanism in order to match orders and buy and sell assets. To implement these things, you need to implement an order book, a matching system, integration with payment gateways and a liquidity pool (your own or connect to someone else's).
• User interface. These are all functions targeted at the target audience of your customers. For example, registering, logging in, setting up a profile, connecting a bank card, buying and selling assets, push notifications, internal chat, PAMM-accounts, an affiliate program, etc.
• Settings and personalization. Your customers should be able to brand your white label solution, that is, change the “white” label to the label of their brand. In addition, licensees also need to be able to select the user interface functions they want. Usually they are divided into basic ones, which are supplied by default with one package, and additional ones, which can be connected separately for an additional fee.
• Security system. You need to be sure that your licensee and end users do not need to worry about any security threats. To do this, you need to study in advance all types of security threats that will be associated with the use of your software, and develop mechanisms for their leveling at the software level.
• Payment system. This functionality is responsible for monetizing your white label solution for you and your licensees, setting up monetization, accepting payments and depositing/withdrawing money by the licensee and end users.
• When you building trading platforms, you should think about what additional services your licensees may need and implement the ability to connect them quickly and easily. For example, it can be payment gateways, liquidity pools, marketing tools, crypto wallets, etc.
• You also need to create a support system through which your licensees' target audience can contact them in case of problems. This also includes training the licensee's staff on how to deal with potential problems.

Here is the functionality for end users:

• Registration, login. This functionality should be as simple as possible and, most importantly, secure. You should offer several options, such as registration via social media, phone number or email. You can also add authentication using fingerprints and Face-ID.
• Identity verification. In a modern white label, for launching trading platforms, there should be tools for verifying the identity of end users: first and last name, bank card, address and phone number.
• User page. It is necessary for personalizing and managing personal data, deposits, wallets, bank cards, as well as for communicating with the administration and other users of the platform.
• Interface of trading engine. These are all functions that are responsible for listing and searching for trading pairs, placing trades, matching, etc. This feature is key for trading platforms - give it the most attention when creating your own white label software.
• Deposit, payments. In addition to the deposit and withdrawal of funds by end users, this function is also responsible for tracking transactions. It should also be possible to view the history of transactions and filter it by date, size, commission and type of transfers.
• Charts, quotes. Users should be able to see all updates of quotes in real time from listings and charts.
• Trader's portfolio. Traders should be able to track their positions in real time and filter them by key criteria.
• News feed. This feature notifies users of trading industry news, exchange rates and other things, allowing traders to stay up to date with current events and respond quickly. This is the best way to keep in touch with the user, inform him about important events, results of transactions, etc.
• Reports, analytics. Traders will appreciate the ability to monitor statistics and analyze the results of their trades. A good solution would be to offer them different types of charts and reports.

Security

One of the main problems of trading is security. And this problem is especially acute in the field of cryptocurrencies, where every year there are large thefts of traders' money from deposits on the exchange. So, the Mt. Gox exchange was hacked in 2014, which allowed hackers to steal $450 million, Bitfinex in 2016 — $65 million, Binance in 2019 — $40.5 million. The Bithumb exchange was hacked three times: in 2017, 2018 and 2019, due to which the trading platform lost $58 million.

Here's what you can do to secure your white label:

• From the side of the licensee. The best defense today is blockchain technology, thanks to which you can distribute your security system to your users. And the more there are, the more secure the system will be.
• From the side of traders. This is where you can implement two-factor authentication using Authy and Google Authenticator. Track IP addresses when registering and logging in, require user confirmation when new IPs are detected. In addition, you need to protect data using cryptography and SSL, and you also need protection mechanisms against phishing, DDos, XSS, CSRF attacks and spoofing "SIM cards" of end users.
• In addition, crypto security must also imply compliance with KYC / AML procedures, personal data protection standards.

White label solution

After you have decided what exactly your solution should be for launching trading platforms, what functions it should have and how to ensure its comprehensive protection, you can proceed directly to the development of the white label. This process usually consists of the following steps:

UX design

User paths on the trading platform: beginner (left) and expert (right). Source

UX is the design of how your product interacts with users. When designing its structure and user paths, you should do everything in such a way that users achieve their goals with a minimum of interaction with the platform and have no difficulty in understanding what and how they should do. To avoid mistakes, pay great attention to user research, getting feedback and testing the UX of your white label.

UI design of the platform

Information architecture of the trading platform. Source

UI is how your crypto exchange white label solution will be seen by its users. In our case, this means creating user interfaces for licensees and traders. All elements of these interfaces, such as colors, typography, graphics, images, videos and icons, should have a pleasing appearance and be styled within a single visual concept. At the same time, all design elements must have functional usefulness and be intuitive for users.

Frontend development

Implies the implementation of the user interface and functions in the code of the desktop program, web interface and / or mobile application. This is the responsibility of frontend developers who, depending on the target platform, must be able to work with HTML / CSS / JavaScript, jQuery, Bootstrap or Foundation, React, Angular. As well as Kotlin for Android and Swift or Objective-C for iOS.

Backend development

Trading platform structure. Source

Backend is what refers to databases and servers that your user cannot see in their application, including communicating with the server. Backend developers use the following technologies: Python, .Net, PHP, SQL databases - mysql, postgres, sql server and NoSQL databases like MongoDB; RESTful services, APIs and more.

Testing

This is the last stage of the white label creation, during which QA engineers "catch" bugs and errors, test the platform performance, check that all operations are performed in accordance with the specifications, and the internal components are working properly.

White label cost

The cost of a white-label invest platform depends on the type and list of functions to be implemented. White label forex price starts from $20,000. The cost of the spot platform will be $20,000 – $30,000. These are the simplest types of projects. The margin platform will cost between $30,000 and $50,000. A platform with derivatives features will cost between $60,000 and $150,000. Of course, these are general numbers and it all depends on the features you want to implement. In any case, our company offers solutions that can be scaled and developed in the future.

In addition, you can consider a binance white label or still stop at renting software solution for your business. This is a good option for initial testing of your idea. In the long run, this is a fairly expensive solution.