An abundance of people conducting currency and stock trading for a living are now focusing on cryptocurrencies in hopes of making money with it. People everywhere are talking about this. Some naysayers say it won’t be around forever and that Bitcoin is built to fail, resulting in a crash affecting all miners and traders. In spite of that, cryptocurrencies are thriving, and there is plenty of room for trading operations and startups to take a piece of it.
In this article, we will explain how to build a cryptocurrency exchange, how long will it take and how much it would cost.
List of The Contents
- What is cryptocurrency
- Why mining isn’t the best way to make money on cryptocurrencies
- A fundamental idea behind creation of a cryptocurrency exchange
- Cryptocurrency exchange development
- Cryptocurrency exchange development process
- Crypro exchange development timeline
- What team would you need to develop web-application and mobile application
- What team would you need to develop basic web portal and mobile application
- How much does it cost to make cryptocurrency exchange: Cost analysis and comparison in different locations
Cryptocurrency is attainable even for those who aren’t tech-savvy. At some point, people discover Ethereum, Bitcoin, and Litecoin, all of which can be used just like the Euro and Dollar. Transactions are made with a cryptocurrency wallet. This form of cryptocurrency is alluring: the cost of transactions is minimal in comparison to national currencies.
The fiat money is still on the top and many trust that we won’t see them disappear in the foreseen future. But there are many signs that cryptocurrencies will slowly change banking system to take the place of the government money and maybe even replace them completely one day.
Cryptocurrency is a kind of digital currency. Registration and emission are determined using asymmetric cryptography using various cryptographic protection approaches, like Proof-of-stake and Proof-of-work. Cryptocurrency system operates on a peer-to-peer network and is decentralized. That said, emissions are not possible. It can’t be counterfeited or destroyed. The biggest benefit, though, is the difficulty that comes with mining. In short, mining with a farm of GPUs will hardly be worthwhile.
Let’s try to calculate for comparison’s sake. The smallest mining “farm” holding 6 GPUs has a starting price of about $5000. Essentially, the mining scheme is based on a mathematical equation. The more people mine, the more resources for cryptocurrency become attainable, making these equations more troublesome to solve. As such, while Bitcoin is currently not the highest it’s ever been at $10 000 apiece after its sudden fall from $20 000 in January 2018, it will take a while to locate a single coin and even longer for the tiniest of farm recoupments. Keep in mind that a basic farm costs about $5000. Browsing the web, you’ll discover warehouses rented out by fanatics will more GPUs than you have ever seen. As such, the costs to run such places are pricey. Further, a high-performance farm’s work will need to be supported. The electricity bill for maintenance alone is more than the starting price. At some point, the mined Bitcoin exchange will surpass the farm owner’s financial stability. Just another hassle that will make you disinterested in cryptocurrency mining.
THE FUNDAMENTAL IDEA OF HOW TO СREATE A CRYPTOCURRENCY EXCHANGE
Because the odds of making a profit at this point are low, the only way to reap the rewards of cryptocurrency is help people already engaging in cryptocurrency. It can pay to be an intermediator, just as much as it can by being a manufacturer or executor. That’s difficult to contest business rule. Recent trends indicate that cryptocurrency exchanges will be in demand, especially with the booming popularity of banking operations using Ethereum and Bitcoin, particularly with alluring features like small transaction fees. An overwhelming amount of people are finding out about cryptocurrencies and its substantially low transaction costs (in comparison to using MoneyGram and Western Union). Most people are using cryptocurrencies for money orders all over the country since it’s quicker and cheaper. It’s just a question of time before Bitcoin is used predominantly by the mass market.
As referenced earlier, trading platforms are the best way to profit using cryptocurrencies. Let’s look into how to make a cryptocurrency exchange and how the cryptocurrency exchange does things like transfer money in cryptocurrency and convert Bitcoins into a fiat currency of your choosing.
CRYPTOCURRENCY EXCHANGE DEVELOPMENT
The cryptocurrency exchange works as follows:
To begin with, the user registers to be part of the system and obtains an individual cryptocurrency wallet. Bitcoins and other currencies can be stored in this wallet.
When money is sent, the user conducts a transaction through the system. Afterward, funds are loaded to the user’s account on the app server. The user then chooses where the money will go and the currency it will be sent in.
What happens next can be done without the user’s assistance.
Purchase of the cryptocurrency is completed by the system on the server side, and the end user’s engagement isn’t required either. Afterward, the foreign currency is bought after the cryptocurrency is sold. The final step involves the user receiving the funds in the currency of their choice into their bank account.
That said, studies show that this isn’t feasible to perform the exchange application process automatically because no platforms have an API to have money withdrawn from a bank account. With the exception of ones that permit money transfers into “confirmed” accounts, an exchange is contingent on the money transfer’s direction.
A successful transaction involves the foreign currency being sent to an account with a native currency. Once an account is established, the user confirms their account. Lastly, the transaction is automatically completed. In short, the cryptocurrency exchange app can be automatic with the exception of one step: the recipient needs to designate the wallet in a new account as “confirmed.”
However, if money is transferred from a confirmed account, the process becomes more troublesome and must be conducted differently. The most optimal approach is to team up with those who issue cryptocurrency debit cards. In the event money doesn’t warrant withdrawal, cryptocurrency can be loaded onto these cards.
When funds are sent to the natural currency, here’s what’s implemented in the cryptocurrency exchange application:
Login/Register page of the cryptocurrency exchange application where the user creates his account or enters using already existing credentials.
Account ID verification with the list of available wallets.
Money remit to the chosen account.
Transactions history screen.
Cryptocurrency exchange screen.
The website will have an API via a backend service that both iOS and Android devices can use:
- Creation of accounts
- Request for the money deposit
- Requests to send money
- Cryptocurrency > Currency exchange proxy APIs
- Management of bank accounts
Afterward, a backend portal will be implemented into the exchange application, which will allow the user to modify the information on his profile.
Lastly, there are multiple platforms for the cryptocurrency exchange app. Both Android and iOS apps operate the same way and execute the same functions.
For the complete implementation of a project, it is worthwhile to develop an exchange application that is web-based for the most optimal user experience.
CRYPTOCURRENCY EXCHANGE DEVELOPMENT PROCESS
The project’s intended functionality can be accomplished in similar ways regarding backend and UX. The initial choice is to install the mobile cryptocurrency exchange app on a user’s web-based application or mobile device that resembles an Android or iOS app and copies the app’s functions. Another choice is to minimize the development fees and decrease the go-to-market time. Startups must begin with the development of a mobile app and return to making a web-based cryptocurrency exchange app afterward.
We’ve calculated some of the approximate duration, human resources, and budgets required for both instances: developing a mobile exchange app and a web-based version simultaneously and a mobile app with a basic site.
A CRYPTOCURRENCY EXCHANGE PLATFORM DEVELOPMENT TIMELINE
Based on our calculations and previous projects, it might take us from 4 to 6 months to finish this cryptocurrency exchange development project. We will display more information for the team and the interaction duration for all specialists individually.
TEAM REQUIRED FOR THE CRYPTOCURRENCY EXCHANGE PLATFORM DEVELOPMENT AND MOBILE APP DEVELOPMENT
- 1 back-end developer working full time for 6 months charging $65/hour to develop the backend service, database, etc. = $62 000
- 1 Android developer working for 6 months at $65/hour to develop an Android application = $62 000
- 1 iOS developer for for 6 months at $70/hour to develop an iOS application = $67 000
- 1 front-end web developer working for 6 months to develop back-end and front-end websites at $55/hour = $52 000
- 1 graphic designer for 3 months at $40/hour to create designs for the website and apps = $38 000
- 2 QA engineers for half a year at $35/hour who will begin testing immediately = $67 000
- 1 PM who organizes all the work within 6 months at $55/hour = $52 000
This project’s budget is approximately 400 000 USD.
TEAM REQUIRED TO BUILD THE BASIC CRYPTOCURRENCY EXCHANGE PLATFORM AND DEVELOP THE MOBILE APP
Let’s assess the resources and team required to launch the project with the basic-function web portal. The single way to transfer funds will be to use the cryptocurrency exchange app.
- 1 full-time back-end developer for the 6 months at $65/hour to develop the backend service, database, etc. = $62 000
- 1 Android developer for the full 6 months at $65/hour to develop an Android application = $62 000
- 1 iOS developer for 6 month at $70/hour to develop an iOS application = $67 000
- 1 QA engineer for 6 months at $35/hour to begin testing immediately = $33 000
- 1 PM who organizes all the work on the whole project duration (6 months) at $55/hour = $52 000
The cost for this would be approximately 288 000 USD.
HOW MUCH DOES IT COST TO DEVELOP CRYPTOCURRENCY EXCHANGE: OFFSHORE AND ONSHORE DEVELOPMENT COST COMPARISON
The rates shown above are inexpensive for a cryptocurrency exchange app project to be done in that window of time. For comparison’s sake, we have shown approximate rates for an identical project outsourced for development into Western European countries like Ukraine or Belarus. Have a look at our 2017 Global Custom Software Development Rates Gude for more information about global outsourcing rates.
How Much It Would Cost to Build a Cryptocurrency Exchange with The Web-Portal and Mobile Application
|Specialist||Number of Devs||Months of Engagement||US Hourly Rate||Europe Hourly Rate|
|Total Cost - $403 200||Total Cost - $196 800|
|Front-end Web Developer||1||6||$55/h||$35/h|
How Much It Would Cost to Create a Cryptocurrency Exchange Platform with Basic Web-Portal and Mobile Application
|Specialist||Number of Devs||Months of Engagement||US Hourly Rate||Europe Hourly Rate|
|Total Cost - $278 400||Total Cost - $144 000|
Keeping the above prices in mind, it may seem expensive at first, but if you look into the future, the deposit required to produce a cryptocurrency exchange app will offer substantial profit earnings. Its success isn’t contingent on the exchange rate and cryptocurrency state. It’s difficult to predict any currency’s course. The only certainty is that the popularity of cryptocurrency will continue to rise over the next several years, and all market tendencies, be it positive or negative, will result in greater interest in these platforms. To summarize, this cryptocurrency exchange app isn’t contingent on cryptocurrency vacillating course since it is only dependent on transactions of trade which will remain intact forever.
Cryptocurrencies have never received more attention than it has currently. The market is still new and has a lot of potential for exciting new concepts. We at Existek believe that there are many accomplishments in the industry to be had. Have a look at our Custom Software Development Services Page or Contact Us to learn how we can perfect your existing software or develop something new for you. If you have any thoughts about blockchain, cryptocurrencies, or something else relevant to this article, leave a comment below. Our team highly appreciates your contributions!