In the last few years, cryptocurrencies have shifted from retail traders’ assets to an institutional tool for hedging risks and investments. Institutional crypto adoption stimulates the industry growth: today many startups and companies strive to develop blockchain products and launch their tokens, to raise investments and expand business. A crucial step in blockchain project development is coin listing on exchange. Let’s drill down on token listing and the essential steps to it.
What is Token Listing?
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The process of adding a new crypto asset to a crypto exchange is called token listing. Once the token is added, it becomes visible to traders and can be bought and sold. Just a few years ago, crypto exchanges were chasing promising projects to list their tokens. Today, the situation changed upside down – now it is a project that has to apply for listing.
You may list your cryptocurrency on exchange of centralized (CEX) or decentralized (DEX) type:
- CEX is a regulated exchange that complies with regulations and has rigorous KYC and AML practices in place. To list a new token on a CEX, projects need to go through due diligence, including documentation, compliance with policies, licenses, etc., which may be pretty challenging.
- On DEXs, there are no central bodies enforcing rules on a platform. Users don’t have to pass any compliance inspection, KYC, or AML procedures. It’s much easier to list token on DEX, so many young projects with good community start from decentralized platforms and over time apply for listing on CEXs.
Essential Steps to Take Before You List Token on Exchange
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Here are the steps to follow before applying for listing:
- Choose a crypto exchange. Listing on different platforms is a good option to start with, as each platform has its own features and token types available.
- Ensure compliance. Prepare for audits and background checks to prove the legitimacy of your project.
- Build a strong community, as they are your potential token holders and liquidity providers. Build quality interaction in your community, as it’s an essential factor when negotiating a listing.
- Partner with a market maker. No exchange wants to deal with a “dead” token. You need to provide liquidity to your asset to demonstrate it is viable. Market makers provide liquidity to new tokens and accompany projects on their way to listing on exchanges, increasing their chances of being approved.
Final Words
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Coin listing on exchange is an essential goal every crypto startup chases. To make it happen, a project must create an engaged community, make sure about compliance with regulations, and partner with a market maker to boost liquidity and turn a new token into a promising investment option.
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