Global Regulatory Framework For Crypto Derivatives Platform

Risk is probably the most talked about trait in the crypto trading market. This has prompted the investors to look for ways to manage the risk in crypto markets. One way to do that is through crypto derivatives. As awareness has grown about the utility of derivatives as risk management tools, so has the awareness for the derivatives markets. Exchanges of futures and options, and over – the-counter crypto derivative markets are now the integral parts of the digital assets economy that have reached a state of advanced economic development. These markets will be important components of the crypto trading scene as they move into more advanced developmental stages.

The diverse crypto derivative markets around the world have many similarities and many differences. One of the similarities is that all crypto derivative exchanges operate under some form of regulatory government. The purpose of this report is to provide some guidance on the appropriate regulatory approach for businesses planning to develop derivatives markets for crypto trading.

There are substantial differences in many specific areas underneath these similarities, but these differences primarily reflect different ways of trying to achieve the basic objectives of financial regulation in the underlying nation. They also reflect some differences in regulatory philosophy, particularly as regards the role of self-regulation in the achievement of regulatory objectives.

As cryptocurrencies spread throughout the globe, so do the regulations put in place to try and regulate them. Every country is constantly evolving and it’s not easy to keep up with the rules in different territories. We’ve put together this guide to help you navigate the various legislative roles against cryptocurrency derivatives, and the activities associated with them. The regulatory framework given here will also serve as a guide to businesses that are looking forward to leverage from this booming market with their own crypto derivatives trading platform.

United States

Cryptocurrency exchange laws are also in unclear legal territory in the United States, and several of the federal regulators seek jurisdiction.

The Securities and Exchange Commission (SEC) has indicated that it considers cryptocurrencies to be securities: it stated in March 2018 that it was looking to comprehensively apply securities laws for digital wallets and exchanges. By contrast, the Commodities Futures Trading Commission (CFTC) has adopted a more friendly “do no harm” approach, describing bitcoin as a commodity and allowing for the public trade of cryptocurrency derivatives.

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Crypto Trading Redefined With Exchange Software

The move headed for crypto regulations is itself an important indication that crypto-market are here to stay for the long. The digital coins are getting exchanged broadly and the industrialists find it comparatively easier to deal in cryptos such as Bitcoin, Litecoin, Ethereum, Ripple on behalf of traditional coins such as Dollar, Pound and Euro.

New crypto exchanges are rising promptly in each corner of the world with the help of several white label crypto exchange software developers, and many are at risk because of the cyber-attack. It’s quite important that investors try to find red flags while deciding on a crypto exchange and analyze fees as well as security safeguards.

Some statistics

▪ The market cap of Bitcoin surpassed $70 billion, with highest trading volumes nearby $3 billion per day.

▪ Cryptocurrency Trading Volume to See 50% Growth in 2019: Research

▪ Technology consulting firm CB Insights has recognized 27 ways blockchain can essentially transform procedures as diverse as banking, cybersecurity, voting as well as academics.

▪ The World Economic Forum evaluates that by the end of 2027, 10% of global GDP will be stored on the blockchain technology.

▪ Most mining pools are located in China, containing more than 70% of total Bitcoin mining. China assemblies’ most crypto mining tools and leverages the country’s cheap electricity prices.

things that make Cryptocurrency exchange software significant for crypto trading

▪ DIGITAL AND IMMUTABLE
Crypto exchange software is fully digital without any physical existence, thus minimizing all potentials of human interference. All the transactions for digital coins on a trading platform are irreversible. Only one way to undo a transaction is by starting a fresh transaction and reversing it.

▪ REDUCED RISK AND FRAUD
Because of the features of immutability and nominal human interference, crypto exchanges face reduced fraudulent activities & risks. They are safe, trustworthy and easy to transact compare to traditional trading platforms.

▪ NO GOVERNMENT INVOLVEMENT OR CENTRAL CONTROL
It’s a really an entity for a global platform, which is not governed by any nation or any association; thereby the system is fully decentralized and free from different regulations and limits.

▪ LOWER FEES PER TRANSACTION
As compared to physical fund where banks have some static charges for every transaction, which are usually high, crypto exchanges offer nominal costs per transaction and also free transaction in multiple scenarios.

▪ COMPLETE OWNERSHIP
Even if the blockchain has a decentralized nature, the owner can still control the overall platform.

BENEFITS of exchange for platform owners

▪ Scalability

o High scalability platform

o 3rd party integration services

o Flexible Architecture

o Customization

o Constant addition of new features

▪ Usability

o In-built dashboards and Reports.

o User-friendly signup as well as trading process

o Customized Themes

▪ Security

o Wide-ranging Vulnerability assessment

o Decentralized ledger for high security

o 2FA and Alerts

▪ Decentralized Exchange

o Option for Blockchain powered decentralized exchange

o Smart Contracts for workflow automation

Summing up

In most circumstances, small organizations can profit from implementing white label cryptocurrency exchange software. There are pros & cons, but the procedure is easy and the problems of accepting digital coins are minor. If you need to keep your business competitive and attract new traders or merchants, it’s time to hit the books about digital coins and embrace the Fintech variations with open arms.

Key Components of a Security Token Exchange

Order Matching

The exchange comprises an order matching engine that automatically pairs similar orders between buyers and sellers at the best market price. It also matches the different orders depending on the market and trading limits.

Fund Management

A wallet is integrated to manage all security token transactions, which are automated. Users can also control fiat-cryptocurrency conversion manually through the in-built processing interface with the associated banks.

Smart Contracts

A smart contract is a computer-generated protocol that automatically triggers a verified transaction and completes it without any human interference. It makes each transaction trackable, secure, and irreversible.

Escrow System

Any transaction between the buyer and seller using a smart contract goes to the escrow system. Once the responsible parties agree to the payment details, the escrow releases the asset without any delays.

Currency Transactions

Any cryptocurrency like Bitcoin, Ethereum or Litecoin or any fiat-currency like the US Dollar and the Chinese RMB can be embedded into the exchange.

Payment Gateway Integration

The exchange platform integrates a payment gateway that allows users to buy and sell tokens using fiat currencies through credit cards, debit cards and other payment methods.

This is a small section from our extensive market report on security token exchanges (STE). If you would like to get complete hold over the nuances of this market with the present and future predictions, the key players, and how to build your own security token exchange, click here for the full research report.

The Role Of PCI-DSS Compliance In White label Cryptocurrency Exchange Software Development

The Payment Card Industry Data Security Standard (PCI DSS) is a widely accepted set of policies and procedures aimed at improving credit, debit and cash card transaction security and protecting cardholders from abuse of their personal data. Four major credit card companies collectively developed the PCI DSS in 2004: Visa, MasterCard, Discover, and American Express. In this article, we will throw some light on how PCI-DSS compliance plays an important part in every white label cryptocurrency exchange software development.

The Objectives Of PCI-DSS

1. It is necessary to maintain a secure network in which transactions can be carried out. This prerequisite requires the use of cardholders or vendors using firewalls that are reliable enough to be successful without causing undue inconvenience.
2. Wherever it is stored, cardholder information must be protected. Repositories should be protected against hacking with sensitive data such as birth dates, mother’s maiden names, social security numbers, phone numbers, and mailing addresses.
3. Systems should be protected from malicious hackers ‘ activities through the use of frequently updated anti-virus software, anti-spyware programs, and other anti-malware solutions. All applications should be free of bugs and vulnerabilities that could open the door to exploits that could be stolen or alter cardholder data.
4. It is important to limit and control access to system information and operations. Cardholders should not be expected to provide business information unless those businesses need to know that information in order to protect themselves and conduct a transaction effectively.
5. Networks must be monitored and reviewed on an ongoing basis to ensure that all security measures and procedures are in place, function properly, and are kept up-to-date. For example, the current definitions and signatures should be given for anti-virus and anti-spyware programs.
6. At all times and by all participating organizations, a structured information security policy must be established, implemented and enforced.

The Role Of PCI-DSS In Whitelabel Cryptocurrency Exchange Software Development

Cryptocurrencies (“cryptos”) are now expected to remain here and will continue to evolve until they become the mainstream currency. While the global shift to cryptos is not going to happen anytime soon, the prospect is that it’s just a matter of time WHEN and not IF. There’s going to be a lot of “shake out” until that day before cryptos become the norm.

In 2014, a crypto space security standard, commonly referred to as the CCSS (Cryptocurrency Security Standard), was implemented to provide specific guidance for secure crypto management. For any information system that handles and maintains crypto wallets as part of its business logic, this standard is currently the go-to standard.

PCI DSS (Payment Card Industry Data Security Standard) can be attributed to the popularity of online payments using conventional or fiat currencies. The big payment brands were spearheading this norm, i.e. American Express, Discover Financial Services, JCB International, MasterCard, and Visa Inc. have become the default standard for companies processing credit card details or storing them. Non-compliance with this standard means that the use of credit cards will not enable an organization to make online payments.

In relation to crypto ventures, PCI DSS is considered to be a kind of manual for the operation. It is still the top best cybersecurity activity.

PCI DSS compliance in a White label crypto exchange software demonstrates a data-security platform ready to address risk, taking into consideration any aspect of payment-data protection, monitoring, and management. PCI is a level of compliance set by major credit card firms. It does not apply to transactions where credit or debit cards are not used.

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Espay Exchange Is a Reliable Exponent in Cryptocurrency Development Sphere Delivering Secure Solutions: GoodFirms

Espay Exchange is a leading Cryptocurrency solutions provider helping businesses with reliable and secure technology to fulfil their exchange solutions requirements and has inscribed into the record of the top blockchain development companies.

Have a look at Espay Exchange’s GoodFirms profile to know more about their portfolio and the service they offer.

An Introduction to Espay Exchange

Founded in 2014, Espay Exchange is a digital solutions company primarily dealing in cryptocurrency solutions. The firm operates under its mission statement to serve clients globally for its exchange software development needs. Utilizing the technology that will thrive tomorrow, they strive to uplift customer experience with their real-world solutions for the real-world problems business face today.

It leads and specializes in exchange solutions while offering fully-customized, scalable, liquidity ready exchange software for start-ups. Their end-to-end solutions in decentralized exchange comprise of unique and desirable features such as self-managed hosting solutions, currency pair management, full liquidity order book, and trading report management.

What We Do at GoodFirms

GoodFirms is a renowned B2B organization that connects IT service seekers to service provider companies. The firms registered at GoodFirms get included after a thorough and detailed evaluation process. A team of expert analysts examines the companies at the company based on Quality, Ability, and Reliability. The companies that deliver outstanding services high on these parameters are added to the GoodFirms list of service provider companies.

GoodFirms similarly evaluated SourceSeek and found that the firm has been doing commendable work in helping service seekers for software development. Below is a brief discussion about the services that were assessed during the research.

The New Building Blocks of Digital Currency

The integration of Blockchain technology into businesses enhances data security owing to the elimination of centralized systems that are usually targeted. Espay Exchange helps develop such cryptocurrency trading software leveraging their more than 10 years of expertise in this domain. Utilizing their path-breaking methodologies, they not only add value to business practices but also curate the best experiences in the industry.

From exchanges including digital asset or security tokens to Forex exchange solutions, the firm assures its clients of a safe and suitable service providing holistic exchange solutions along with optional hosting services for added security. Espay Exchange is a top blockchain development companies in Australia at GoodFirms as a result of their peerless efforts in this field.

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