The decentralized and often open-source nature of blockchain seems to open up the black box of the FinTech world. The technology itself allows auditors to review cryptocurrencies and be assured that there is nothing to hide.
There are more than 6000 different cryptocurrencies, and numerous crypto exchange platforms are emerging in the crypto sphere. As many users trust their funds to exchange platforms to manage, the question of transparency and the ability to make informed decisions arises.
In an exclusive interview with DailyCoin, Mike Ermolaev, head of PR at crypto exchange platform ChangeNOW, explains what values are essential to implement in a crypto exchange platform.
Transparency Is the Key
Centralized cryptocurrency exchanges typically use custodial trading, where users deposit their fiat money or coins at the exchange. Trading occurs within the databases of the centralized exchange, not blockchain.
Once trading is complete, users can regain custody of their cryptocurrency by withdrawing their coins from the exchange. Upon withdrawal, the exchange uses an on-blockchain transaction to transfer coins from the exchange’s wallet to the user’s wallet.
Custodial trading at a centralized exchange exposes the user to safety risks. The wallet provided by the exchange platform could be hacked. Even big players such as Binance are not hack-proof. During the huge hack of 2019, 7,000 bitcoins were stolen from Binance users.
This is all without mentioning that, if the exchange is compromised, the platform may refuse, or be unable to withdraw coins from the exchange’s wallet back to the user’s wallet. Non-custodial trading potentially limits, or entirely eliminates these counterparty risks.
Ermolaev highlights that the need for transparency was the starting point for developing the ChangeNOW exchange platform, and non-custodial solutions are part of the necessary transparency in the exchange market.
"ChangeNOW is a pretty transparent product for this market. And we are going to grow even more transparent in the future because that's what also pushes things forward,"
The ChangeNOW platform offers instant and limitless cryptocurrency exchange without registration. Currently, there are around 320 coins on the platform available for exchange. Ermolaev states that their competitive advantage in this highly saturated cryptocurrency exchange market is honesty with their customers.
"I think it is [being] honest with your customer. In my opinion, it is the number 1 point in all that transparency. Being honest with your customer even in the tiny details. It is important. That's why we are here, and I can say that we are going to stay here for a long time,"
The company sees the need for process transparency and to provide honest estimations about transaction times and prices to customers. Sometimes using exchange platforms can be frustrating because of the fees that can arise unexpectedly, or the transaction times, which make users wait as long as a regular bank transfer would.
Ermolaev notes that fast swaps with no hidden fees are the core factors that make the ChangeNOW platform stand out. Additionally, by not requiring user authorization, the platform can use its services with several clicks.
Importance of Crypto Education
Crypto may well be both very rewarding and harsh to those who hop on the train. As mass adoption moves forward, and the regulatory environment is still developing, crypto education and knowledge are crucial safety nets for all traders.
"Education is a very important point, especially at this crucial moment of the crypto market. It is important for different market members to be honest with users, being open and telling them what is going on,"
Ermolaev highlights that the company invests time and resources into educating its customers on not losing their finances while trading on the ChangeNOW platform. This is an integral part of being a transparent and responsible business.
"Along with education, it is important to give possibilities. And we're trying to give as many possibilities as possible back to our ecosystem. So I think these two factors together will make the market more conscious and grown-up,"
Ermolaev admits that mass adoption is bringing newbies to the market, but their products are being utilized by crypto veterans as well. ChangeNOW strives to grow together with the expanding crypto market and provide solutions that are suitable for everyone, no matter the level of crypto knowledge that the user has.
On The Flipside
- As the crypto exchange market is highly saturated, ChangeNOW will have to fight for its spot in the light.
- The more prominent exchange platforms tend to attract higher numbers of users, which is why it might be harder to convince them to use the services of a smaller player.
- The overload of information makes it more difficult for customers to distinguish the unique value proposition of different crypto services providers.
Why You Should Care?
The variety of exchange platforms and competition pushes the crypto exchange industry forward. ChangeNOW is a non-custodial, registration-free exchange platform that puts the privacy and trust of its clients first.
Watch the full interview here next week!