How could you initiate a new Exchange Market?

Question

Supposing I want to "initiate" an exchange market. Is the only way to get some bitcoins IN to buy them from another exchange and trying to sell them? (or to wait for people starting trading, correct?) Thanks

Answer 1

Surely the name "Exchange" suggests a place for changing one form of currency for another. e.g. exchanging US dollars for pounds sterling, Bitcoins for Euros etc. Therefore Yes, like any shop, you must get some stock in order to trade

Answer 2

As the name "exchange" suggests, an exchange does not buy or sell bitcoins themselves. They merely function as an exchange between sellers and buyers.

So what you will have to do is wait for people to start trading. But people won't come by themselves, so you will have to give users a reason to come to you instead of an existing exchange. It may also help to trade on your own site in the beginning both to not completely rely on new user's transactions and to generate some trade volume.

Answer 3

Well an exchange isn't usually selling directly, it's simply hooking up buyers and sellers. A large enough exchange can do this pretty quickly and easily. So the biggest barrier is getting bootstrapped which might mean starting with a volume to sell and buy yourself. And providing incentives over the already-existing exchanges for both parties.