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CoinEx Speaker Series

CoinEx’s Transformation: From a Crypto Exchange to a Blockchain Financial Service Provider

2021-10-12 09:54:59

Now that the number of exchanges has doubled in the crypto market, the playground has been further leveled. Based upon past experience, even the top exchanges can be outpaced by the late-comers, such as the old hits Bter, Jubi, BTCC, etc. Even when Binance ranked first in digital mining, it was not a winner-takes-all market, and other exchanges can still win market shares through efforts. Since 2013, new exchanges have frequently attracted the attention of investors, such as MEXC, FTX, Bybit and others emerged from the latest round of bull market.

As the competition between the exchanges grows more intense, the key to winning market attention lies in the differentiated business operation. Binance, for example, won the first spot because it was the first to offer currency trading services and provide platform-based tokens. And Bybit sprung up in the contract trading business while BitMEX has been embroiled in legal battles. FTX came to prominence by providing new trading derivatives and leveraged tokens. Last but not the least, CoinEx stood out in the industry by providing services to remote corners of the globe and constantly upgrading its layout in the crypto market.

At present, the cryptocurrency market is still in fierce competition and continuous innovation. The exchange that can satisfy hot new demands will be the next investment focus.

Possible Targets for Differentiated Business Operation

1. Services in Minority Languages Have Become the Key to Winning Competition

At present, most exchanges attach great importance to the expansion of overseas markets. For example, Binance has its own service teams in many foreign countries and carries out distributed operation. Its business is mainly concentrated in developed countries such as Europe and America. Huobi and OKEX focus more on Asian regions, such as Southeast Asia, Hong Kong, Japan, Korea and other countries and regions. The overseas layout has become a key factor for company development, as the competition in developed regions has grown more and more intense.

In addition to its business operation in Europe and Southeast Asia, CoinEx also focuses on Russia, Arab countries, the Middle East, Western Europe and other regions. For now, the cryptocurrency trading market has taken on a reasonably stable picture in most developed countries, so the market share of minority language users will become the new business focus.

CoinEx has yielded substantial results in the field of minority language services. In recent years, CoinEx has extended its business scope to languages such as Persian, Japanese, Indonesian, Portuguese, Arabic, Ukrainian, Turkish, German, etc. At present, it has basically covered most minority language countries and plans to support more this year. In this way, it avoids competing with other exchanges in the tight market by building its own user base in minority language-speaking areas, so as to realize its cutting edge in differentiated business operation.

This strategy is just like that of the mobile phone market. When most mainstream mobile phone brands were constantly fighting price wars, some brands quietly gave up the domestic market and focused on the growing business in India, Africa and the like regions. Eventually, these brands topped the local market by occupying the majority of the market share and caused the attention of the industry.

2. Compliance Governance & Regionalization Cohesion

In addition to minority languages, compliance governance is another focus for exchanges, but usually takes a long time. For many countries, their policies of cryptocurrency exchanges are still unclear, causing difficulty for exchanges to carry out compliance construction. On the other hand, an exchange’s user group can be from all over the world, so it has to respond to different policies of different countries.

Regarding that, CoinEx is making constant improvement in aspects such as business operation, user assets custody, KYC, etc. In accordance with the regulatory requirements of different countries, CoinEx deploys local personnel to better comply with the market situation in different areas. With all the measures above, CoinEx has been working hard to be recognized by local authorities in various countries.

3. Improvement of Basic Trading Services

In addition to differentiated services, basic trading services also play an important role in an exchange’s development. Generally speaking, the basic services include currency trading, fiat trading, and contract trading. Although differentiated services play a key role in the exchange's market competition, the basic business of the exchange must be solid and firm. Basic operation is the foundation of the exchange. And in this regard, some exchanges blindly pursue innovation and despise basic business, thus causing a massive loss in their user base.

Compared to its counterparts, CoinEx has made great efforts in basic business operations and launched a series of new services, such as market-making and wealth management. Among them, market making has attracted the attention of a large number of investors.

CoinEx has realized the openness and standardization of market making to offer a financing channel that attracts investments. For exchanges, failure to draw in funds may result in poor liquidity of trading pairs and a large bid-ask spread, which brings a bad experience to investors and stunts the further development of the platforms. CoinEx, on the other hand, enhances the liquidity of trading pairs through the public participation of investors in market making. It not only benefits the users with profitable returns but also brings market depth and service improvement to the platform, thus achieving a win-win situation for both investors and itself.

Combining with the Hit DeFi, Platform Tokens Embrace a Future

Last year's DEFI boom drew the attention of exchanges to the yield farming business. Many major platforms such as Binance and Huobi responded in time, by launching the platform-token-based public chains to create their own DeFi ecosystems. Till now, although the DeFi ecosystem can be found on most platforms, many exchanges are slow in progress and gradually lose the attention of users. And even Huobi and Binance, after a round of wealth effect, seem sluggish in developing their DeFi ecosystems, which has become a choke point for further development.

Like its counterparts, CoinEx has also established its platform-token-based chain, where some DeFi projects have begun to settle in. One robust example is OneSwap, which supports yield farming on CET public chain. OneSwap is a governance token deployed on the CoinEx public chain. At present, it not only supports the CET public chain but also Ethereum, BNB Chain, TRON Chain, etc. Its cross-chain blueprint will direct DeFi users of Ethereum, BNB Chain, Tron Chain and other public chains to CoinEx Smart Chain.

OneSwap, CoinEx's virgin exploration in the DeFi field, has been very successful so far and full of potential. In the past, when Huobi gradually began to deploy DeFi services, the price of HT tokens in the market has seen a very large increase. The same is true for the previous BNB Chain. When the exchanges extend their business to the field of DeFi, the demand for platform tokens in their respective ecosystems naturally increased, which became the direct cause for the surge in platform token price.

In addition, the early wealth effect brought by the platform-token-based chain cannot be overlooked. CoinEx’s DeFi ecosystem is still in its infancy, and there remain many development opportunities. From the outcomes Huobi and Binance have yielded, the prospect for CoinEx Smart Chain is promising.

Apart from DeFi, CoinEx also attaches great importance to the price of CET. In March this year, the CoinEx team burned a total of 1.08 billion locked CET thus enabling the token to enter full circulation again. In addition, the team's repurchase strategy has also guaranteed the constant deflation of CET, which is critical to a strong currency price. The purpose behind these strategies is to reward CET users and attract more investors to pay attention to CoinEx. 

CoinEx's Future Role in the Crypto Market

For many people, CoinEx is just an exchange, but this view is one-sided. CoinEx Exchange is just one part of the ViaBTC ecosystem, which also includes the CoinEx Smart Chain (CSC), OneSwap, ViaBTC Mine Pool and ViaWallet (upgraded to CoinEx Wallet). However, the projects above are often ignored by many.

Among them, ViaBTC Pool may be very familiar to most veteran miners. Although mining is currently banned in China, the main users of ViaBTC Pool are from overseas countries such as Russia, so the prohibition has not had much impact on its operation.

From the mining pool to the wallet to the exchange, and then the smart chain, DeFi and other functions, all is for CoinEx's plan to become an integrated investment and transaction service provider in the crypto market.

Service integration has obvious advantages, especially to enhance user attraction. Therefore, some exchanges, such as Huobi and Binance, have followed CoinEx in building their own mining pools to provide comprehensive services for miners. However, mining pool operation can be very different from that of exchanges, and ViaBTC has taken lead in the race since 2016. If other exchanges such as Huobi and Binance want to catch up with CoinEx, they need to work harder.

CoinEx's ecosystem includes various applications. It provides a one-stop service for its users, and substantially increased customer loyalty and user satisfaction. On CoinEx, whatever the users need can be satisfied. For example, crypto investors can realize revenue increase through DeFi, miners can ensure profits in bear markets through hedging, and traders can choose their preferred trading methods between the decentralized exchange and centralized exchange. This full-service model puts CoinEx in a strong position to compete with other exchanges.


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