Listing Procedure: Is It Difficult to Add a New Coin to the Exchange?

A listing on a cryptocurrency exchange is the best way to make a digital coin popular and recognizable. After a cryptocurrency begins to trade on a large platform, its liquidity increases, as a rule. Some developers are trying to add their tokens to the maximum possible number of cryptocurrency sites, while others aim only at the very top. Each of these tactics has its advantages and disadvantages, about which we will tell you in this article in detail.

What is the “listing” of a coin?

Let’s start from the very basics, so what is the listing? This is the process of adding a certain coin to the list of trading assets on the exchange. There is also a reverse procedure, which is called delisting, it means the removal of the coin from the list of trading assets of the site. It is carried out only when the token stops to satisfy the requirements of the exchange.

The listing process takes a fair amount of time and consists of four stages:

  1. offer;
  2. evaluation;
  3. check;
  4. adding.

Let’s talk more about each of them. At the first stage, it is determined whether the asset fulfills all the necessary requirements of the exchange. If something does not match, then representatives of the site start negotiations with the developers, where they discuss whether it is possible to fulfill all the set conditions for both parties. If the exchange and the developers come to an agreement, then the experts of the site proceed to the next stages, namely, checking and evaluation.

We want to remind you:

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It is worth noting that the second and third stages can take place in different sequences on different exchanges. Some sites initially determine the reliability of the project, and only then its potential prospects, and others – vice versa. But in any case, these two stages are mandatory during the listing procedure.

In order to check this or that cryptocurrency, the exchange’s experts analyze it from both technical and legal points of view. Exchange employees check the performance and reputation of the project development team.

At the cryptocurrency evaluation stage, the experts analyze the potential prospects of the coin, its liquidity and roughly calculate the income that it can bring to the exchange. In order to do this, analysts are conducting a fairly large-scale investigation, which includes the following parts:   

  • novelty for the industry;
  • interest of the participants of the cryptocurrency community;
  • news background;
  • economic potential;
  • a real need for a token in the project.

This is not a complete list of criteria by which projects are evaluated in the listing process.

Finally, at the last stage, exchange and the creators of the coin sign a contract, where the duties and rights of both parties are written.

How to add own cryptocurrency to the exchange?

The listing procedure can take place in two scenarios:

  • Exchange specialists independently discover a coin that potentially has a good chance of development. Then they contact the development team with the proposal to add this project to the list of traded assets.
  • The creators of the coin independently appeal to representatives of the exchange with a proposal to add their product.

It should be noted that in our modern realities, the conditions are usually set by the exchange. The fact is that now there is a rather high competition among new projects in the cryptocurrency market. Based on this, it is not difficult to guess that often the initiators of the listing are the creators of coins. It is important to understand that not all projects receive a positive response from the exchanges, so in order to increase own chances, developers need to do the following steps:

  1. To begin with, it is necessary to carefully study the features and basic conditions of listing on the chosen site and to submit an application strictly following all the conditions of the exchange.
  2. Next, it is necessary to prepare a complete package of documents that will greatly simplify the process of checking the activities of a startup. It is important to understand that the more transparent the development team will behave, the more likely it is that the application will be approved.
  3. Then it is necessary to prepare a presentation of a product. First of all, the exchange is a commercial organization and its main goal is to make a profit. For this reason, site staff must make sure that this coin will be in demand among users in the future. If the creators of the coin can prove the profitability of their project, the probability of approval will increase many times.
  4. The final step on the part of the developers is the preparation of technical documentation. This is necessary so that exchange specialists can quickly check the safety and reliability of the coin. The ideal option is an open source project.

By and large, if developers want to place their product on a large stock exchange, they must prove its usefulness and profitability, as well as demonstrate its transparency.

How do the rules vary on different exchanges?

Each individual site has different standards for evaluating coins, so before submitting an application, developers should find out what priorities a particular stock exchange has. By and large, the thoroughness of verification depends on two main factors: the size of the exchange and its dependence on regulators. For example, if a site is under the strict control of regulatory authorities, then it will probably add not the most promising, but legally “clean” and transparent coin. Conversely, decentralized exchanges would rather give preference to financially promising coins and will not carefully check the legal side of the issue.

How much does a listing on cryptocurrency exchanges cost?

Of course, the commercial side of the issue also plays an important role in the approval of the application. And besides it is not about the potential profit from the trading volume in the future, but about the short-term profit – the initial payment before listing. Of course, adding a new coin is a certain risk for the exchange, therefore, as a rule, the marketplace owners prefer to play it safe and ask to pay a fixed fee. If the project is qualitative and promising, then these costs will pay off in several times.

The size of such payments directly depends on the popularity of the exchange and the project itself. It can vary from a couple of tens of thousands to several million dollars. In fairness, it is worth noting that the last figures are more likely to be rare and the creators of cryptocurrency exchanges did not officially confirm them.

Conclusion

So, in this article, we investigated what the process of listing coins on a cryptocurrency exchange is, and learned the main criteria for selecting projects. Different trading platforms have different rules that must be followed by the developers of new digital coins.

But it is important to understand that it is very difficult for young projects to get the support of a wide audience without listing on the major exchanges. For this reason, almost all developers want to add their products to the list of traded assets on popular exchanges.

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