Introducing “Cobinhood” | Services for ICOs & zero transaction fees

In the blockchain scene, there are a lot of people and projects competing with each other, and trying to earn for themselves a good position in the market of this promising industry. It can be seen as a sort of Pandora's box where once this technology and its benefits became publicly known, tons of people from all over the planet jumped on the blockchain’s bandwagon, and suddenly we find ourselves with blockchain conferences happening in several continents like Asia or Europe, and all sorts of blockchain projects planning to disrupt every industry we can think of.

The potential of this technology to bring important changes for humanity is extremely high, and this is clearly reflected in the enthusiasm that people and institutions have for future developments and implementations of not only blockchain, but also decentralization as a concept.

Since the platforms, protocols and decentralized applications that are being developed can very well disrupt the finance industry through the use of cryptocurrencies, there must be then a type of platform providing a place for users to handle their new virtual assets, and as we know, these platforms are known as exchanges.

Brief explanation of what an exchange does

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Given the fact exchanges are used to move money, they need to have a very reliable infrastructure, and they also need to develop and implement proper security measures to provide the maximum protection to their users funds, the worst thing that can happen to an exchange is to get hacked and lose its clients money, which is why these companies always invest a lot of their resources into making the platform as secure as possible.

But developing sophisticated security measures to keep hackers out of the platform is very challenging and expensive, and if we take into account the fact that exchanges also need to cover another type of expenses, then it ends up being very clear that maintaining this type of service can very quickly consume a lot of capital.

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Hence, the need to have effective strategies to monetize their platforms and their services, but as every person who trades with cryptocurrencies will know, what the majority of exchanges do is to simply charge fees for every single transaction that happens in the platform, this way they earn money based on how active their users are.

This can sound very good when we look at it from the exchange’s perspective, but from the traders perspective paying fees might not be the very best thing because it means their returns are getting reduced due to the fees they need to pay, and until very recently this little issue was something unavoidable, but in the last few years thanks to the emergence of blockchain technology, several entrepreneurs have figured out ways to maintain an exchange operating in the most optimal way, without needing to charge fees to the traders.

One of these innovative exchanges is Cobinhood.

Cobinhood overview

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Cobinhood is an exchange where traders won’t have to pay any fee for their operations, this means their profits are going to be bigger for those who are skilled enough to achieve positive returns when placing their different orders in the exchange.

The important aspect regarding the sustainability of this project is to understand how are they going to cover expenses if they won’t be charging any trading fees to their users, and this is where the team at Cobinhood came out with an interesting plan.

But first, it is important to understand that given the extreme competitiveness of this industry, a lot of ICOs with promising ideas to create valuable dapps or platforms, might end up being ignored due to all the noise there is in the market, this happens because if there is a huge and constant influx of new projects, investors and people, in general, can get overwhelmed and they might not recognize those hidden gems that have real potential, the worst that could happen is having those valuable teams that are just starting, deciding to close their project because of not having enough support.

Luckily, Cobinhood is one of those exchanges who are aware of this issue, and their plan to monetize their platform simply consist of offering underwriting services for promising ICOs and provide them with every help they need in order to allow their ideas to materialize into the market, and this includes of course, adding their token in Cobinhood’s exchange.

Cobinhood's plan is to monetize their expertise in managing successful blockchain projects, and use these resources to cover any expense coming from the exchange, which sounds like an interesting dynamic, but it clearly depends on new projects and ICOs coming in for it to be sustainable, either way, the idea of removing trading fees from the equation is always something exciting, and traders using this exchange will probably be extremely happy.

Conclusion

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This article is meant to serve as an introduction to Cobinhood, they are having a fairly smart approach to differentiate themselves from any other common exchange when it comes to the monetization strategy, and it is always nice to learn about projects looking for new ways to innovate in their respective niche.

The specifics regarding the services Cobinhood is offering to ICOs will be explained in a future article that will go live very soon.

This project is going to be present in the South East Asia Blockchain Summit in Jakarta, Indonesia that I wrote about very recently.

As always, I am very interested in knowing what do you think about this way of monetizing a trading platform? In my opinion, it clearly depends on Cobinhood finding new ICOs on a constant basis, and since for the last few months and years there hasn’t been any shortage of ICOs, it might very well work for the coming years.