Requirements for an exchange

1. Appropriate Exchange License: Every exchange needs to be properly licensed in order to operate. This varies from country to country but involves obtaining approval from the relevant securities regulation body. 2. Financial Reporting Requirements: Any exchange needs to be constantly updated with financial statements in order to show its financial situation and remain compliant with any regulators. 3. Trading Platform: Every exchange needs a trading platform to enable an orderly market place. Some exchanges may use their own proprietary trading platform while others may use third-party software. 4. Investor Education: Exchanges need to provide appropriate resources to enable investors to understand the various financial instruments they are trading and the inherent risks associated with them. 5. Risk Management System: Exchanges need to have appropriate procedures in place to ensure price integrity and manage any uncertainties in the markets. 6. Settlement Procedures: The exchange needs to oversee the whole process of settlement after trades have been agreed upon. This includes the transfer of ownership of assets, the payment of the relevant funds to each party and the reporting of any successful transactions.