With the advancement of blockchain technology, more and more people began to wonder how to build a cryptocurrency application. In fact, there are several basic ways to do this.
This article will walk you through the basic technical and business aspects of cryptocurrency app development. You will understand what a cryptocurrency is, how it works, the main types of cryptocurrency apps, their pros, and cons.
Table of Contents
- 1 What is a cryptocurrency and how does it work?
- 2 Market trends and insights
- 3 What are the main types of cryptocurrency apps?
- 4 Pros and cons of cryptocurrencies
- 5 How to create a cryptocurrency mobile app step-by-step
- 6 What technologies should you choose for cryptocurrency app development?
- 7 How much does it cost to create a cryptocurrency app?
- 8 How to earn money with cryptocurrency apps?
- 9 Our expertise
- 10 The bottom line
What is a cryptocurrency and how does it work?
Cryptocurrency is a digital currency that can be used to buy goods and services, but an online ledger with strong cryptography is used to secure online transactions. Much of the interest in these unregulated currencies is trading for profit, and speculators sometimes push prices up.
A cryptocurrency is a form of payment that can be exchanged online for goods and services. Many companies have issued their currencies, often called tokens, and these can be traded specifically for the goods or services the company provides. Think of them as slot machine tokens or casino chips. You will need to exchange real currency for cryptocurrency to access a product or service.
Cryptocurrencies operate using a technology called a blockchain. Blockchain is a decentralized technology spread across many computers that manage and record transactions. Part of the appeal of this technology is its safety.
Market trends and insights
In the world of cryptocurrency, time is a critical factor as things can change quickly due to high market volatility. Check out the statistics below to understand how the cryptocurrency market works.
The global blockchain market is projected to grow to $23.3 billion by 2023. In 2018, cryptocurrency market size statistics showed that the blockchain market is only worth $1.2 billion. In 2019, that figure rose to $2.2 billion. Its annual growth is expected to continue to grow.
A message about Bitcoin appears on social media every three seconds. Recent cryptocurrency stats have shown that 28,866 posts about Bitcoin are posted daily on social media. If you count, about 1203 messages are published every hour. That’s about 20 posts per minute!
What are the main types of cryptocurrency apps?
When creating your cryptocurrency app the first thing is to choose its type. The most common ones are wallet, exchange, or marketplace, but there are other options as well. Here’s a list of the most common cryptocurrency applications.
A cryptocurrency wallet is software that stores the private and public keys of customers. Software like this allows people to sign transactions, track expenses and, for sure, store all your passwords in one place (preferably in a safe place).
☑️Statistics aggregation platform
There is not much to say about such platforms, except that when developing such a cryptocurrency application, you need to pay maximum attention to the UI/UX design, and not just the functionality responsible for collecting data.
☑️Cryptocurrency trading application
It can be common cryptocurrency exchanges (Bitstamp, Kraken), decentralized exchanges (Compound, Uniswap), or peer-to-peer trading platforms such as LocalBitcoins and Paxful. The development of such apps is long and expensive since you need to create not only a mobile app but also a corresponding back-end.
Let’s say you have an online store or exchange service and you want to accept payments in Bitcoin and Ether. Most probably you will have to process each such payment manually as there are no stable payment gateways on the market that can be integrated with major e-commerce platforms. Such projects are being created, but so far nobody has managed to achieve success.
Pros and cons of cryptocurrencies
If you are thinking about cryptocurrency app creation, firstly you need to know its pros and cons. Read on to know more reasons why cryptocurrencies are on the top and why it’s worth using them in your business.
Advantages of cryptocurrency
The decisive argument is the blockchain. Blockchain frees cryptocurrency from power and makes it so that nobody can dictate the rules to cryptocurrencies’ owners.
- Fast and unlimited transactions
The processing and settlement of monetary transactions are time-consuming. Your business will have to wait several days to receive the money. This way, you can create an unlimited number of transactions and send them in a second.
- Low transaction fees
Financial institutions charge significant transaction fees. This does not mean that you do not need to pay cryptocurrency transaction fees. Besides, the amount you need to pay is relatively small.
- Internationally recognized
The sender and recipient of funds may be located in different parts of the world. You can save on currency conversions and commissions that always accompany international fund transactions.
- Transparency and anonymity
Every transaction is recorded. At the same time, if the crypto address is not publicly confirmed, nobody will know the sender and the recipient.
Disadvantages of cryptocurrency
- Limited acceptance
Countries are very reluctant to support any kind of cryptocurrency. There are still limited options in daily life for those who want to buy something using cryptocurrency.
- High volatility
The market is unstable, with ups and downs that often happen. Thus, investing is very risky because you don’t know if it will be a beneficial investment.
- Transactions are irreversible
Entering the wrong address can cost you money. Unable to cancel the transaction. You can submit a refund request, but if it is rejected, be ready to forget about the funds.
You’ve probably heard stories about people who lost their gadgets, forgot their private key, and were unable to access their cryptocurrency fortunes. It can happen to everybody, so there is a chance of losing funds.
These pros and cons should be considered as they will help to achieve desired business purposes.
How to create a cryptocurrency mobile app step-by-step
Step #1: Identifying the problem and setting the goal
This entails identifying the aim of the app by clearly understanding the common problems customers are facing, analyzing the existing solution, and defining the way your app will solve the problem. It will help you choose the best type of Blockchain solution. Conduct a cost-benefit analysis to determine if an application is worth the investment and assess the potential risks.
Step #2: Choose the right consensus mechanism
Blockchain systems are decentralized and require people to confirm the transaction. You should evaluate the best consensus method based on the needs of your application. When choosing a suitable consensus mechanism, consider the following criteria: the anonymity of validators, trust in validators.
Step #3: Choosing the right platform
The Blockchain platform allows you to create customized applications without writing Blockchain code from scratch. Examples of common platforms: Ethereum, BigChainDB, Hyper-ledger Fabric and Quorum, and others. Consider these criteria to help you choose the right platform for your application:
- License: under what license is the platform distributed? Is it completely free or not?
- Popularity: How popular is the platform? Is the community around the platform big enough?
- Activity: how active is the platform, how often does it receive patches of updates?
- Network type: is it a public, private or offline network?
- Ease of Access: How easy is it to use and how scalable is it?
Step #4: Application model development
Decide whether to use hybrid, internal, or cloud. You also need to choose the right Blockchain solution to implement. You can choose from unlimited, allowed, private, public, or hybrid blockchain models. Also, rate the best stack based on your chosen platform.
Step #5: Application configuration
The configuration of the blockchain app is critical as most of the components cannot be changed once configured. If you are unsure of the correct configuration of your smart application, it is better to consult with an expert.
Step #6: User interface and admin console design
After planning the server components, you need to choose the best front-end programming language, external databases, and servers for the app. The user interface should provide all the necessary functionality and be easy to navigate. You can follow the UI design heuristic as a guide.
Step #7: API creation
While there are several pre-built APIs, you may want to create custom APIs for your app. APIs can be for data validation, key pairs, and address generation, managing smart contract interactions, and storing and retrieving data.
Step #8: Testing and scaling
The best approach here is to use the MVP (Minimum Viable Product) model, which involves building a workable POC (Proof of Concept) solution and testing it to identify crashes, latencies, memory and storage issues, and performance issues. Once the problem is found, fix it and move on to testing for other bugs until the application is fully functional.
When developing an intelligent blockchain application, you can get a lot of information from the existing blockchain community on the major blockchain development forums. The forums are full of blockchain experts who are generous in sharing information and helping others solve the problem.
What technologies should you choose for cryptocurrency app development?
Now that we’ve talked about the development process, it’s time to discuss the technical side of building a cryptocurrency app.
|Blockchain Development||Bitcoin, Ethereum, Hyperledger, Corda, and more|
|Mobile App Development||React Native, Flutter, Xamarin|
|Web App Development||Node.JS, Nest.js, Next.js, Angular, React.JS, PHP|
|Back-end Development||MongoDB, MySQL, AWS, Firebase|
How much does it cost to create a cryptocurrency app?
It’s a problem to specify the exact cost of similar works since their volume is unknown. Moreover, it is difficult to estimate the amount without preliminary negotiations, since different clients have different expectations. In this case, there should be at least approximate figures. Thus, from our team’s experience, we can say that the minimum required time for cryptocurrency app development varies from 700 to 1500 hours and more.
How to earn money with cryptocurrency apps?
A monetization model where app developers are paid to display third-party ads in their apps. Such advertising can be of several formats. The most common are: Ads, Banners, Video Ads, Plain Ads, Text Ads, and Interactive Ads.
It is understood that users can access the application’s basic functionality for free and expand it later by connecting paid functions. The principle of this approach is simple: users download a free app, see the range and quality of services provided, explore premium features with a preview, and pay for them.
This model is close to freemium, as it allows you to test a mobile application first. However, unlike freemium, the subscription model is more suitable for applications with high user engagement and/or for services that provide unique content and services.
Affiliate marketing means that you will be placing ads in your app with unique links and making a profit every time people reach out to potential customers and/or make purchases.
This option assumes that you will charge a fee for all transactions made in your application.
This method supposes that the person pays once and immediately gets access to all features. When mobile apps first appeared, this monetization model was the only one.
Almost all widespread mobile apps use it, so you should consider this option. The main thing is not to trade confidential user data, but marketing data: behavior, desires, and preferences of consumers.
The Code&Care team has worked a lot with cryptocurrency app development projects. The two of our most prominent projects are Bitfintex and Coinbar.
Coinbar Group, founded on the cutting edge of blockchain technology in 2013, is made up of nearly 50 cryptocurrency specialists with expertise in the development of projects and products, market analysis and asset management, cryptocurrency incubators, and venture capital.
The Code&Care team worked on the implementation of 2 access points. The first one is for internal purposes and the other for external ones. These APIs were responsible for handling authorization and payment processing. Besides, we implemented the WooCommerce plugin that was used on the main site to allow users to log in and request to buy currency.
The next project is Bitfintex. Bitfinex is a full-featured spot trading platform for major digital assets and cryptocurrencies including Bitcoin, Ethereum, EOS, Litecoin, Ripple, NEO, Monero, and many more. Bitfinex offers leveraged margin trading through a peer-to-peer funding marketplace, allowing users to trade securely with up to 3.3x leverage. Our team worked on the front-end part and the Bitfinex mobile app.
Given the popularity of crypto exchanges around the world right now, it’s understandable why more and more people are getting involved in these systems.
Digital currency apps provide great opportunities both for those who are just getting acquainted with the market and for those who already have good experience in it. But the market still has quite a few restrictions depending on the country or currency, and this always means upside potential.
Building a quality app can bring you big profits in a short time. Have you got any questions? Feel free to contact us via email: [email protected].
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