What is an exchange and what isn't changes from peoples perspective to legal stuff to each nation.
If you are asking what is an exchange to a person, each person would give you a different answer and according to them each of the answers will be different.
If you are asking what the legality of it is, each nation have their own lawns which usually goes into the fact that if you are working with banks (turning fiat to crypto and vice versa) or not as the biggest point. So, there is no definite answer to this, it all depends on what you are asking and how you are asking it.
If you are not doing anything remotely legal related, that means you do not have too much trouble slapping the word exchange on anything you want as long as people could trade even just one pair in the website.
Topic: What constitutes a crypto exchanges? (Read 179 times)
I wouldn't call such websites an exchange platform. You're just a seller, selling a token to allow the users to vote on the DApp. The main activity of your site isn't exchanging, it's selling.
Otherwise, we could call Badoo an exchange platform because you can deposit money to buy their token and then be allowed to vote for the hottest females there
Otherwise, we could call Badoo an exchange platform because you can deposit money to buy their token and then be allowed to vote for the hottest females there
What if there is no visible BTC trading pair on site? Let say one of the feature is to vote on the dapp, but in order to vote you need xx amount of utility token of the dapp, so users gonna need to deposit BTC to sort of like buying the utility token, in general does this automatically be considered a "crypto exchange" as well?
Well, while your platform might not primarily be a crypto exchange, but in your example if your platform is going to handle the exchanging of assets and not relaying it to other exchanges, then technically your platform still has an exchange feature. But then again, I think you're better off asking local authorities for a specific answer. Whatever guideline may apply in my country might not apply to yours.
In most of the countries what follows traditionally gets applied to modern things. In my country for example, gambling is not allowed and any sort of it may be, its just illegal. So even if I go and play on William Hills then its illegal in my country. In similar fashion, trading works here. Since trading is completely legal, we have seen most of the crypto exchanges arising out of no where and making this as base. They are applied with same rules as that of traditional exchanger (stock exchanges etc.) You have to report the authorities before you open up the exchanger.
It's banking has to be transparent and legally you must posses shop act license to run the same. For example, have ABC trading Co. registered in first place under which whole game will played. And of course you have to report all the earnings as well.
It all comes back to what your website or platform is doing mainly and what is concentrated on more than other things, if users need to deposit bitcoin so that they can exchange it for an specific utility token that enables you to vote I wouldn't necessarily call that a exchange because it means people that are buying that utility token are not doing it because of the profit that it gives them but they are just exchanging their bitcoin to be able to use your platform or website, but then again as I said it depends on many other factors.
What if there is no visible BTC trading pair on site? Let say one of the feature is to vote on the dapp, but in order to vote you need xx amount of utility token of the dapp, so users gonna need to deposit BTC to sort of like buying the utility token, in general does this automatically be considered a "crypto exchange" as well?
Well, while your platform might not primarily be a crypto exchange, but in your example if your platform is going to handle the exchanging of assets and not relaying it to other exchanges, then technically your platform still has an exchange feature. But then again, I think you're better off asking local authorities for a specific answer. Whatever guideline may apply in my country might not apply to yours.
Noted and thanks for the info
What if there is no visible BTC trading pair on site? Let say one of the feature is to vote on the dapp, but in order to vote you need xx amount of utility token of the dapp, so users gonna need to deposit BTC to sort of like buying the utility token, in general does this automatically be considered a "crypto exchange" as well?
Well, while your platform might not primarily be a crypto exchange, but in your example if your platform is going to handle the exchanging of assets and not relaying it to other exchanges, then technically your platform still has an exchange feature. But then again, I think you're better off asking local authorities for a specific answer. Whatever guideline may apply in my country might not apply to yours.
Since bitcoin is technically a cryptocurrency, as long as you have a BTC trading pair, then it should probably be automatically be considered a "crypto exchange".
It will most probably completely depend on what country you're in though, as each country will have their own specific guidelines.
It will most probably completely depend on what country you're in though, as each country will have their own specific guidelines.
What if there is no visible BTC trading pair on site? Let say one of the feature is to vote on the dapp, but in order to vote you need xx amount of utility token of the dapp, so users gonna need to deposit BTC to sort of like buying the utility token, in general does this automatically be considered a "crypto exchange" as well?
Since bitcoin is technically a cryptocurrency, as long as you have a BTC trading pair, then it should probably be automatically be considered a "crypto exchange".
It will most probably completely depend on what country you're in though, as each country will have their own specific guidelines.
It will most probably completely depend on what country you're in though, as each country will have their own specific guidelines.
What is a bare minimum requirement to be recognize as an exchange? For example, deposit BTC/ETH in exchange for some utility token in order to use certain features or privilege on the dapps or website, is this consider an exchange?
Some countries have strict policy and law to run an exchange.
Some countries have strict policy and law to run an exchange.
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