Topic: Where do exchanges get their Bitcoin? - page 2. (Read 3888 times)

Most of the exchanges platform get their bitcoin to all users who sign up/register to their exchange sites to trade their coins through in every transaction charge fees that there gonna make whether they are going to buy a coins or withdraw their coins.

Exchanges when established needs capital and they buy volumes of bitcoin. But later on they dont need to buy bitcoin they just earn it from the transaction fees and other fees they charged during trading. And also they charged the developers of any coin with some amount before they could enter in their site. So exchange is like a market that charges the vendors.

Just like any other business, exchange is another business. They have their initial investment, but they are getting profits from the brokerage percentage they charge from every trade. So this is the basic return the exchange owners get.

Also from their earning, if they want to exchange it to bitcoin, they can simply do it from their own exchange system. which is not a very big deal in any ways.

Starting  exchanger sites  is no  joke  because  you would really needs  thousands of bitcoins  to start on. I dont  have  any  idea on where those  bitcins  came from  but  one thing  is on  my  mind that those   bitcoins are their personal possesions and they tend  to build  exchange sites because  these are good  investments too.

Yes ! True that. The exchanges came after bitcoin since the exchanges were there for bitcoin so bitcoin had to have been first or there would be no reason for the exchanges to exist.

Is there a minimum number of bitcoin required for one to start an exchange business? Or is it up to the exchange how much they can put up as a start up capital. Maybe what they did was buy in bulk or were owners when the price was still very low and when the price started to rise, they deemed it profitable to start an exchange business. Just my thoughts, though.

Most common way of exchanger det their profit is from transaction fee, for coinbase they got it from buying and selling bitcoin, for xapo i think they got it from the advertising or affiliation from their faucet game

But why about some site or wallet ar not trying for charging a small fee for their member today? like xapo he never charging their member with the another fee except for trying charging for giving fees for the miners get a confirmation for their transaction and how their source? about the ads income are not balancing for their daily spend.

Yobit got a 20k satoshis fees each withdrawal you make so I think they are getting profit from that. Plus they are also getting a 2% each time you do an exchange from bitcoin to another one. So from that, they could pile up a lot of bitcoin and maybe invest it in a different way.

Why those exchanger need bitcoin or have to buy it because they are just like marketplace where vendor sales their items and marketplace get their cuts on sales.

Likewise when some seller sells their coin to buyer in trading platform actually it was sellers bitcoin which goes to buyer and trading platform just take fee usually 0.2% of amount traded, so why should they need to buy bitcoin to buy/sell to users.

From the start, those bitcoins were mined. And maybe there were no exchanger right after bitcoin was launched. People had to do P2P I guess and that's how exchangers got they bitcoins. The possible ways of obtaining bitcoins on the start were mining and buying it directly from other people. I guess that's how they got their coins and then from that, their exchange site was launched. They would have invested a lot of money in bitcoins first before they get to open their exchange site.

They get bitcoin from traders. They keep bitcoin stored and when they get out of stock they simply buy from other exchange sites or from bulk traders. Sometimes they also bitcoin it's out of stock or similar message. They acquire bitcoin mostly from other sites because they have deal from previous itself.

to me the main source from where the exchanges get their money is from the transaction fee, may be they also have invested their bitcoins in different  places,

For you to put up a site or an exchange if you asked, you need lots of money/bitcoin. And where do they get this bitcoin?  From the investors of the the sites. And then they do a rolling for their bitcoin to grow.

And they get money/bitcoin from those who deposits and sell their respective coins and that's what we call transaction fees.

I heard some altcoin exchange sites like bittrex and Poloniex charge from 2 btc for listing a coin in the exchange. this is also a way of exchanges to get bitcoin. they  charge bitcoin to add a new coin.. and they earn from all exchanging and trading also..

well, coinbase is not a altcoin exchange. so it's all business depends on bitcoin selling.

Bitcoin currency exchanges work in a manner similar to banks. One first deposits amounts of money in the currencies supported by the exchange, to his own account in the exchange, uses these balances to trade with other users of the exchange and then withdraws that money. Unlike over-the-counter transactions, there is no risk of losing money due to people not fulfilling their part of the deal, as long as the exchange itself does not commit fraud or withhold money.

Exchanging is done by placing "buy" or "sell" orders, which the exchange system software then matches with each other. "Buy" orders (or "bids") are offers to buy bitcoins in exchange for another currency at a maximum price-per-bitcoin which is set by the offerer. "Sell" orders (or "asks") are offers to sell bitcoins at a minimum price-per-bitcoin. If the bid price of a buy order is higher than the ask price of a sell order, an exchange can be performed and either the bid order, the sell order or both can be removed from the "order book". Thus, at any given time, there is a price above which there are no more buy orders and a slightly higher price below which there are no more sell orders.

Communication with the Bitcoin currency exchanges is commonly done using a standard web browser, over a secure SSL connection.

The payment methods that are most commonly accepted and used by Bitcoin currency exchanges are:

Bitcoin transfers
Liberty Reserve
Bank wires
Credit cards
Currencies that can be exchanged with Bitcoins in an automated way include:

US Dollars
Euros
Japanese Yen
Russian Rubles
Pound Sterling
Pecunix Gold

the exchange just wanna for making the transaction for buying the bitcoin looks like a directly like you're buying in the exchange for directly. but there is the another opinion are he don't know if the people are wanna for buying a bitcoin from the exchange site is not for the directly, because if you're already sending a request to the exchange site(not through the trading place), the exchange are making a margin trading for your order in their trading place and asking for the seller of bitcoin for selling the bitcoin into your order.

The more trader on exchanges,the more bitcoin income the exchanges has. From every trading transaction they charge .2 percent i think,though very small but with the big volume being traded they got a handsome profit aside from the withdrawal fees.Also,they got bitcoins to start the business sourced from miners and other seller.

I think there is a lot of exchange that makes a profit, the first trading fee, the fee withdrawals, and sales profits or buyer of course ?

yeah I think of a fee per trade that users do, of course if you ever make trades and all purchases and sales of course you get a fee right ?