<p>Coming from a financial programming side (C++/Network/Trading experience), I would politely suggest that having a web team is not quite enough to make an exchange.</p>

<p>Granted, your average Bitcoin exchange may not need the HFT credentials of your average dark pool or big name exchange. But you're still dealing with a system that needs high uptime, high throughput, and low latency, all while doing it in a rather centralized way. I don't know what kind of web sites you're used to writing, but most of the ones I've seen can get away with just load balancing on to a pool of servers that don't need to be coordinated in a critical fashion. You're then looking at fiddly stuff like memory management and CPU pipelining that your ordinary LAMP stack guys may not be familiar with. Now of course I don't know what your guys are capable of, it may be they already have experience with it.</p>

<p>Regarding banking regulation, I've looked into the rules regarding money laundering. (In fact, I have a legal opinion.) I'm also regulated through my work by multiple financial authorities, and I can tell you the KYC stuff is not trivial. It can be dealt with, of course, but you might find the volume of inquiries forces you to hire someone, who would then need to be trained. In any case, I know for a fact that there's quite a few scam artists and money launderers in the Bitcoin space. (In fact, in over a decade of financial experience I've never come across either, but run into at least three in 2 months with Localbitcoins). There's also a general trend among financial regulators to regulate more and more, so chances are things will get quite expensive. Add to this the fact you're talking to retail clients (I assume) in multiple jurisdictions.</p>

<p>None of this is to say it can't be done. Often these things are a question of having a good team and methodically working through the issues, with a player for each position.</p>

CC BY-SA 3.0
2013-12-13T19:28:32.420Z
I'm happy to talk to people about stuff like this, but I've got a heck of a lot of stuff on my plate these days. How advanced are your plans?
Carlos
CC BY-SA 3.0
2013-12-15T09:16:57.463Z
It's an interesting project, that's for sure. But it's big enough that you need quite a few dedicated staff, and the investment that goes along with that. Start a blog and keep us updated.
Carlos
CC BY-SA 3.0
2013-12-12T17:56:22.830Z
2013-12-12T17:56:22.830Z
Carlos
<p>From the top of my head:</p>

<ul>
<li>Website</li>
<li>User account management</li>
<li>Fulfillment of legalities (all depending on local law): Know-Your-Customer, Anti-Money-Laundering, license to exchange currencies, banking licenses, money transmission license</li>
<li>Banking partnership/account in order to process Deposits and Withdrawals in at least one currency other than Bitcoin</li>
<li>Deposits and Withdrawals in Bitcoin</li>
<li>Safe Storage of Bitcoins</li>
<li>Some sort of Market software</li>
</ul>

<p>You probably want to find a lawyer to tell you what legal requirements you need to fulfill for your Nation's jurisdiction, and perhaps somebody that can help you with the economical/marketing side of things.</p>

CC BY-SA 3.0
2013-11-21T13:09:34.880Z
2013-12-12T13:34:06.993Z
2013-12-12T13:34:06.993Z
Murch
<p>What do I need to setup a bitcoin exchange website like:</p>

<ul>
<li>BTC China</li>
<li>Mt Gox</li>
<li>Bitstamp</li>
</ul>

<p>I have my own web development team and we can code pretty much anything so that is not a problem.</p>

<p>I'm at a loss when it comes to know-how of this bitcoin business.
How do these exchanges even work? What would I as a provider need? Money (bitcoins)?</p>

<exchanges><buy-bitcoins><sell-bitcoins>
What is needed to make a bitcoin exchange?
duimstra
# What is needed to make a bitcoin exchange?

(Asked by: username_0 on 2013-11-21)

What do I need to setup a bitcoin exchange website like:

* BTC China
* Mt Gox
* Bitstamp

I have my own web development team and we can code pretty much anything so that is not a problem.

I'm at a loss when it comes to know-how of this bitcoin business.
How do these exchanges even work? What would I as a provider need? Money (bitcoins)?

**Tags:** exchanges, buy-bitcoins, sell-bitcoins


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## 2 answers

### Answer by username_1 on 2013-12-12. Score: 8

Coming from a financial programming side (C++/Network/Trading experience), I would politely suggest that having a web team is not quite enough to make an exchange.

Granted, your average Bitcoin exchange may not need the HFT credentials of your average dark pool or big name exchange. But you're still dealing with a system that needs high uptime, high throughput, and low latency, all while doing it in a rather centralized way. I don't know what kind of web sites you're used to writing, but most of the ones I've seen can get away with just load balancing on to a pool of servers that don't need to be coordinated in a critical fashion. You're then looking at fiddly stuff like memory management and CPU pipelining that your ordinary LAMP stack guys may not be familiar with. Now of course I don't know what your guys are capable of, it may be they already have experience with it.

Regarding banking regulation, I've looked into the rules regarding money laundering. (In fact, I have a legal opinion.) I'm also regulated through my work by multiple financial authorities, and I can tell you the KYC stuff is not trivial. It can be dealt with, of course, but you might find the volume of inquiries forces you to hire someone, who would then need to be trained. In any case, I know for a fact that there's quite a few scam artists and money launderers in the Bitcoin space. (In fact, in over a decade of financial experience I've never come across either, but run into at least three in 2 months with Localbitcoins). There's also a general trend among financial regulators to regulate more and more, so chances are things will get quite expensive. Add to this the fact you're talking to retail clients (I assume) in multiple jurisdictions.

None of this is to say it can't be done. Often these things are a question of having a good team and methodically working through the issues, with a player for each position.

> **Comments:**
> **username_1**: I'm happy to talk to people about stuff like this, but I've got a heck of a lot of stuff on my plate these days. How advanced are your plans?  
> **username_1**: It's an interesting project, that's for sure. But it's big enough that you need quite a few dedicated staff, and the investment that goes along with that. Start a blog and keep us updated.  

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### Answer by username_2 on 2013-11-21. Score: 3

From the top of my head:

* Website
* User account management
* Fulfillment of legalities (all depending on local law): Know-Your-Customer, Anti-Money-Laundering, license to exchange currencies, banking licenses, money transmission license
* Banking partnership/account in order to process Deposits and Withdrawals in at least one currency other than Bitcoin
* Deposits and Withdrawals in Bitcoin
* Safe Storage of Bitcoins
* Some sort of Market software

You probably want to find a lawyer to tell you what legal requirements you need to fulfill for your Nation's jurisdiction, and perhaps somebody that can help you with the economical/marketing side of things.


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