Sure, we all know brokers are in a frenzy to add Cryptocurrencies to their offering. We already told you those details in previous articles. But by focusing just on forex and CFDs you may be missing the big picture. What’s happening with cryptos may go way beyond the typical Metatrader FX trading universe…
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Growth Rate
Usage, investments and transactions of cryptocurrencies are growing at an outstanding rate. In September 2015, there were 4.3 million Blockchain wallet users – just two years later by September 2017, there are now 17.2 million blockchain wallet users. That's getting already bigger than the retail FX universe.
This gain is good for a 300 percent increase in the number of users in just two years and growing strong! Moreover, popular business like Overstock.com, DISH Network, and PayPal are already taking Bitcoin as a form of payment. It would not be surprising if at least 20 percent of the world’s population are either investing, trading, transacting, or mining cryptocurrencies within a decade from now.
As a forex broker that already has the technology and infrastructure, doesn’t it make sense to get a piece of the action?
How to get a piece of the crypto pie
So what does this mean? By simply taking liquidity and allowing your clients to trade on leverage you are simply adding another instrument. This is great because people are drawn to cryptocurrencies due to their exponentially increasing popularity.
You could get a piece of a much bigger pie by letting your current and future clients take physical delivery.
- This drastically increases the size of your audience and lets you leverage your current resources to the max.
- Just think about it, what proportion of your current customer and prospect base wants to own cryptocurrencies like Bitcoin and Ethereum?
- Not to mention the fact that the transactional cost on crypto currencies are way higher than FX
- Think about it, a typical commission on a crypto deal is 20 basis points which is $2,000 per million
- What are you used to making on your FX transactions? $100 million? $20 million?
Now that you realize the opportunity to make way more money on way more customers, how do you go about doing it?
Start your own crypto exchange
Well, companies are coming out with crypto currency exchanges in a box. These are turnkey solutions that integrate into your current infrastructure. They will allow your current and future clients to buy/sell, invest and transact cryptocurrencies with you earning commissions.
Isn’t this the next logical step in your evolution as a business?
While the forex business is stagnating and becoming overly regulated, the crypto market is at the beginning phase of an exponential growth curve.
‘Crypto in a box’ solutions will aggregate liquidity from up to 20 exchanges and liquidity providers. Your clients can transact on leverage up to 20:1 right on your platform or take physical delivery.
Clients can also use your exchange as a wallet to transact with other individuals. From an infrastructure standpoint, the solution is equipped with payment processing and client onboarding /verification components that will truly make the process turnkey.
And the great thing is that the solution is pre-integrated into PrimeXM and OneZero. This allows you to plug your OWN liquidity into your own FX offering and sell it to other FX brokers that don’t have this powerful tech.
We will get into the details of key benefits of this tool, which will allow you to max your profits even further in subsequent articles. Moreover, we will discuss how you can truly maximize your profitability by acting as a market maker or an ECN on your own exchange.
Alex Nekritin is the Managing Director of Nekstream Global, a liquidity and technology consulting company helping brokers, HFT traders and money managers to find proper liquidity and tools for their ventures. Alex has over 10 years of experience in the financial space.
