First, they already have a bitcoin before exchanger itself is made. Maybe they mine it from the miner or even buy it from someone.
After the exchanger was made, then they got their Bitcoin from the fees of their customer.
Topic: Where do exchanges get their Bitcoin? - page 6. (Read 3888 times)
Two that come to mind are Coinbase & Circle. I did a quick google search, possibly wrong terms. The information I got was useless. I am sure this has been discussed. If there is a good article/link on this it would be appreciated.
To open an exchange you needs lots of bitcoin, i think that most of the popular/biggest exchanges are early adopters of bitcoin. So they have a good amount of bitcoin, otherwise they have invested a large amount of money buying bitcoin in the past and also another source is the profit from every exchange that is made there which is at least from 0.2% to 1%.
Most exchanges either start with some Bitcoin they bought directly from miners or other exchanges, and then they eventually buy some from users or whatever as their exchange grows and they become self-sufficient for their Bitcoin.
If it is an exchange with direct peer-to-peer exchanges, though, then the exchange relies on the consumers and producers to procure their own Bitcoin.
If it is an exchange with direct peer-to-peer exchanges, though, then the exchange relies on the consumers and producers to procure their own Bitcoin.
I guess in the beginning some people have to invest a little of their own money to get started and to keep the wheels spinning. Once the exchange is up and running, they just generate income from the
transactions being done on the exchange and then buy Bitcoins from miners and other exchanges directly. Anyone know if any of these services have their own Mining farms too? I know a while back, a
company started as a mining operations and then changed their business model into something else, when mining were no longer profitable for them. Just cannot remember which company it was.
Seems like the most logical solution transactions being done on the exchange and then buy Bitcoins from miners and other exchanges directly. Anyone know if any of these services have their own Mining farms too? I know a while back, a
company started as a mining operations and then changed their business model into something else, when mining were no longer profitable for them. Just cannot remember which company it was.
wonder how close you were to being correct
I guess in the beginning some people have to invest a little of their own money to get started and to keep the wheels spinning. Once the exchange is up and running, they just generate income from the
transactions being done on the exchange and then buy Bitcoins from miners and other exchanges directly. Anyone know if any of these services have their own Mining farms too? I know a while back, a
company started as a mining operations and then changed their business model into something else, when mining were no longer profitable for them. Just cannot remember which company it was.
transactions being done on the exchange and then buy Bitcoins from miners and other exchanges directly. Anyone know if any of these services have their own Mining farms too? I know a while back, a
company started as a mining operations and then changed their business model into something else, when mining were no longer profitable for them. Just cannot remember which company it was.
if initially a condition rises where a demand is actually way above the exchange wallet's coins ?
That's simple.. they wont pay...
it's not a rocket science, they get money from fee's, each transaction have fee's(buy/sell,withdraw). they SHOULD have enough money to pay all their customers even if all of them try to withdraw at the same time.
BUT, that doesnt mean they have it on their wallet. And if that happens, they will need to solve(lending some bitcoins for example) or they will just shutdown and run away
the exchanges get their money from the fees of the transactions happen at there, while we get the exchange of our money from those people who sell their coins.
No,but if I check a particular transaction,its the same amount of money being deducted from my balance which is directly paid to the network.Not even 1 satoshi is kept by the exchanges.I might be wrong though.[/quote]
sorry but yes, you are. Well... at least in general. withdraw fee might be used to pay the network(depending on the amount, they will not use it all) but they have fees to buy and sell too. poloniex for example uses 0.15/0.25 for every transaction you do there.
I'm very uncertain while answering your query,infact I had the same doubts to which I could not get a convincing answer.
To all the people replying ,they get the coins from the people depositing in the exchange wallets.What if initially a condition rises where a demand is actually way above the exchange wallet's coins ? How does exchange deal with that ?
There are no boundaries set by any exchanges I reckon.Moreover most of the people don't really save up coins in the exchange wallets.What we're looking here is the wallet acting as an middle men but coinbase doesn't operate like that.To me ,its still a mystery.
To all the people replying ,they get the coins from the people depositing in the exchange wallets.What if initially a condition rises where a demand is actually way above the exchange wallet's coins ? How does exchange deal with that ?
There are no boundaries set by any exchanges I reckon.Moreover most of the people don't really save up coins in the exchange wallets.What we're looking here is the wallet acting as an middle men but coinbase doesn't operate like that.To me ,its still a mystery.
the exchanges get their money from the fees of the transactions happen at there, while we get the exchange of our money from those people who sell their coins.
No,but if I check a particular transaction,its the same amount of money being deducted from my balance which is directly paid to the network.Not even 1 satoshi is kept by the exchanges.I might be wrong though. 
Two that come to mind are Coinbase & Circle. I did a quick google search, possibly wrong terms. The information I got was useless. I am sure this has been discussed. If there is a good article/link on this it would be appreciated.
Coinbase and Circle get bitcoins from people that sell bitcoins to them. They may also buy off exchanges or have private deals with miners or large holders.
The term exchange is confusing. Coinbase and Circle are not exchanges, in that they are not marketplaces where people buy and sell. I suppose you could call them exchangers. They buy and sell bitcoins.
the exchanges get their money from the fees of the transactions happen at there, while we get the exchange of our money from those people who sell their coins.
not only from that, when the exchange starts or when they need bitcoin they buy it from othersi think thats the only way new exchanges can start because they usually have no miners to have their own coins
the exchanges get their money from the fees of the transactions happen at there, while we get the exchange of our money from those people who sell their coins.
huh people that sign up with the intent to sell, I would guess early buyers and miners.
Or is this not the question you are asking?
Or is this not the question you are asking?
Two that come to mind are Coinbase & Circle. I did a quick google search, possibly wrong terms. The information I got was useless. I am sure this has been discussed. If there is a good article/link on this it would be appreciated.
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