Exchange Collateralization

4 min read

How to activate the lifetime HollaEx kit exchange software and about XHT collateralization via the bitHolla dashboard

What is exchange collateralization?

Exchange collateralization is used to power and update the HollaEx Kit white-label exchange solution. When you have enough HollaEx tokens (XHT) you can lock them for the duration of use for the HollaEx kit.

Exchange collateralization is the most affordable and most risk-free way to start your exchange business but it requires the XHT token as collateral. For those that don’t have the initial capital you can either open up your exchange to others to help with the XHT or bitHolla directly can lend XHT. In the case where bitHolla lends a monthly fee will apply.

There is a growing list of benefits for those that collateralize their XHT and is now more open with the public exchange projects page, collateralization is not just for exchange operators but for everyone that wants to push crypto infrastructure forward.

Benefits are listed below for XHT collateralization:

  1. As an exchange operator, you can run your exchange with the HollaEx Kit on any machine/server independently with unlimited trading pairs and get unlimited exchange software updates and features going forward.
  2. The amount of collateral will earn passive income from any unsold XHT tokens (redistribution) during the 3 years Wave Auction. This is open to anyone as long as they put up collateral towards an exchange project.
  3. (Coming soon!) As an exchange operator, you will have access to crypto liquidity for your exchange. This includes the ability to lend and borrow liquidity in real-time from the network based on your collateral amount.
  4. Can reclaim all XHT collateral when not using the exchange software and can transfer to others or market sell the tokens.

How to collateralize an exchange?

There are two ways to collateralize your exchange. The first is to create your exchange project in the bitHolla dashboard by following steps. After creating the exchange there will be an option to add collateral either all at once or a little as you go. As an exchange creator, you also have the option to publicize your exchange so that others can contribute XHT collateral to your exchange project.

Find exchange projects to contribute XHT towards at dash.bitholla.com/project or open up a project of your own.

The second option is to search on the bitHolla dashboard for other public exchange projects that you can help contribute collateral towards. This works similarly to a crowd-funding platform where you pledge an amount and once the target amount is hit the collateral amount pledged is now locked as exchange collateral. One difference is that you can reclaim your XHT collateral back either before the target or after through a voting system.

To find projects to collateralize you can navigate to the dashboard and projects tab and find featured projects or you use the search function which will be coming soon.


What is multi-party collateralization?

Multi-party collateralization is just a fancy word for crowd-funding. The difference being any one can easily reclaim all their collateral back from a project. Similar to how other crowd-funding platforms work you are able to contribute XHT collateral to exchange projects through the bitHolla dashboard.

If you have an exchange all you need to do is open up your project and share your exchange project pitch page explained below in this article.


How to share your exchange project?

To make your exchange project public for others to view and contribute XHT you must click ‘go public’ on your collateral page. You must have already created an exchange for this to work.

Once you’ve clicked ‘go public’ on the pop up a public pitch page for your exchange will be created, here you can fill out all the relevant information by clicking ‘edit’ pencil icon. Once, you’ve filled out all the details about your project you can share it with others by clicking ‘share exchange’ and copying the page URL or simply copy the URL from your browser will also work.

When it comes to crypto projects being transparent and realistic with your project information is key. Well presented project pitches will be hand-selected and featured on the bitHolla projects page to market interesting projects. In some cases, bitHolla will contribute XHT collateral towards exceptional exchange projects.

Why should I help other exchange projects collateralize?

Besides the obvious reason for earning passive income from the Wave Auction, the collateralized XHT is just a low-risk and transparent way to help to build and push crypto infrastructure forward globally.

Snapshot of global activity of bitcoin node activity on the internet showing the lack of crypto projects in many developing countries. These regions are untapped potential and high growth areas for crypto projects such as exchanges and other crypto-based financial services. (source: https://medium.com/@PanteraCapital/vcs-missing-97-of-the-trade-blockchain-letter-november-2017-e02abd27c47f)

Each exchange project should justify the feasibility of the project and communicate why the project is unique in order to convince you to lend your precious XHT collateral.

To help with your decision making there’s a dedicated pitch page for all open projects to help you evaluate the viability of a project.

Each pitch page details all the unique selling points, angles, risks and rewards for the project and why you should offer up XHT. Some projects may offer benefits and rewards to those that pledge certain amounts in order to sweeten the deal.

Use the bitHolla projects page to research projects before you pledge your XHT.

Whether you’re thinking of running your own exchange or want to contribute collateral to an exchange project it ultimately comes down to your own research. By utilizing the comment section you can directly ask questions about the project with the project starter, however, this will require at least 1 XHT collateral pledged to comment. Pledged XHT collateral can be withdrawn at any time before the target amount is met.

You can use this exchange list to find out which countries lack exchange infrastructure to help you pick the right project that needs the critical crypto infrastructure needed to make a better crypto-financial based network.


How to find other projects to collateralize?

You can find projects by navigating on the bitHolla dashboard to the projects tab, there you will find featured projects. After clicking ‘view project’ you read about all the unique selling points about the exchange project. For anyone that has pledged they are allowed to comment to gather more information about the project.


What if I want to run an exchange without dealing with XHT collateral?

For those that don’t want to deal with XHT or don’t want to crowdfund their XHT from others, they can contact bitHolla who will lend the XHT collateral. This type of business arrangement can be accessed by picking the Holla cloud service in the setup or directly getting in touch with bitHolla.

To get more information on how to run your exchange with the help of bitHolla can contact sales@bitholla.com

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