Blockchain Development Cost
Today, blockchain technology goes far beyond cryptocurrencies, becoming more prevalent across different sectors, including healthcare, e-commerce, and logistics. Recognizing the potential of Web3, more and more organizations are interested in robust, well-designed, and transparent distributed systems. And first question that arises with business owners wishing to implement Web3 solutions is the cost of blockchain apps.
However, there is nothing new here. The cost of blockchain development services, like building any other solutions, depends on the features and technologies you use. A better understanding of these cost-driving aspects helps you estimate and manage the expenses of your blockchain project. Read our article to the end and get the full picture of key factors affecting the blockchain app development cost.
Cost-Driving Factors of Blockchain App Development
You have multiple ways to build a blockchain application. Apart from the fact that each of them has its own advantages and limitations, they also play their own roles in the final pricing. That’s why the more details of a project you share and discuss with your service provider, the more accurate cost estimation you will receive. But without an understanding of these nuances, it can be challenging.
Anyway, there are always key factors that lay the foundation of your project cost. By studying them, you can calculate the approximate development cost. Let’s take a look at these in detail.
Industry You Operate in
The first factor that influences the cost of your blockchain solution is the business niche for which it is created. Different industries have distinct regulations that impact the final app-building price. For example, creating a blockchain app for the banking sector, which requires more security, will cost you more compared to application development for healthcare.
Here is the cost estimation of some industries:
- Public Sector: $70k – 100k+
- Finance Sector: $60k – 100k+
- Healthcare: $55k – 100k+
- Social Media: $45k – 100k+
A combination of multiple factors defines the complexity of a blockchain application. It’s essential to conduct a thorough cost analysis, considering design, feature set, and other app features, before proceeding to the development process. This will help you budget appropriately and allocate resources effectively.
Every blockchain system includes a specific consensus algorithm, which allows all members to authenticate transactions. The two most well-known consensus mechanisms are Proof of Work (PoW) and Proof of Stake (PoS), but there are others like Delegated Proof of Stake (DPoS), Practical Byzantine Fault Tolerance (PBFT), and more. Selecting a consensus protocol for your blockchain project is a crucial decision that affects your network’s security, governance, scalability, and performance. So, you need to evaluate which one is most suited to your needs. Additionally, together with your service provider, you need to consider permissions, asset issuance, signatures, and other key elements.
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Since developing a blockchain application from scratch is expensive and time-consuming, different platforms provide pre-built modules and easily integrated components, thus cutting costs. While choosing a blockchain platform, consider the following factors: scalability, security, interoperability, and other important features. It will help you to pick the most suitable one for your application. Ethereum, Hyperledger Fabric, Hydrogen Molecule, IBM Blockchain, and ConsenSys Quorum are the most popular blockchain development platforms.
The blockchain ecosystem has various types of APIs, each designed for a specific purpose, and they can both simplify and complicate the development process. Although now the market can find various pre-built APIs, you may need to build a custom API for a specific use case.
The design of blockchain applications is crucial for attracting and retaining users. However, a highly interactive and visually appealing UI/UX design which enhances the user experience adds complexity to the development process. It requires more resources for design iterations and user testing, thus increasing the overall cost.
Therefore, a combination of the factors above defines the scope of blockchain project complexity. Keeping them in mind, we get the next estimated costs of blockchain app development:
- low-complexity apps with basic features – $30k – $60k;
- medium-complexity apps having both centralization and decentralization elements embedded in their architecture – $60k – $150k;
- high-complexity apps from scratch and with advanced functionalities – $150k – $350k.
Blockchain Development Cost Based On App Type
Blockchain technology has a range of uses beyond cryptocurrencies. Based on your business requirements, the features you want to include in your app, what type of audience you want to target, how it will work, and on which of the platforms it will be available, you can have an idea about the type of blockchain app you need. Here are some popular types of blockchain-based applications and their approximate costs.
This type of blockchain app is used to store, send, and receive crypto tokens. Feature-rich software wallets allow users to conduct successful transactions and manage different cryptocurrencies effectively. The typical price for designing a crypto wallet application is between $25k and $180k, depending on its complexity level. Building a simple app with basic features costs you from $25k to $60k, while a full-fledged wallet development can reach $200k.
Decentralized Autonomous Organization (DAO)
DAOs are fully automatic and self-executing digital governance organizations, with rules and operations determined by code rather than a central authority. They operate on a blockchain, utilizing smart contracts to automate the decision-making processes and governance functions. Hiring a development agency to build DAO from scratch, your budget ranges from $3,5k to $50k, depending on its type (investment, social, protocol, media, philanthropy, etc.) and blockchain platform.
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Decentralized Applications (dApps)
DApps autonomously operate on decentralized networks, using blockchain technology as their underlying infrastructure and smart contracts to complete transactions between users. Unlike traditional centralized applications, which rely on a single central server or authority, dApps are designed to be distributed, transparent, secure, and resistant to censorship. dApp development can cost between $45k and $160k. The size of the blockchain dev team, industry, complexity, and type are key cost-driving factors here.
This is an online platform to buy, sell, trade, and showcase Non-Fungible Tokens (NFTs). Unlike cryptocurrencies, NFTs are distinct and cannot be exchanged on a like-for-like basis because each one has unique properties. NFT marketplaces are a popular investment among modern-age businesses and have gained significant attention in the art, entertainment, and gaming industries. The estimated cost of NFT marketplace development typically falls within the range of $50k to $500k.
Cryptocurrency Exchange App
Cryptocurrency exchange applications allow users to trade, buy, sell, and manage cryptocurrencies using a secure and robust app infrastructure. They provide a platform for individuals to exchange one cryptocurrency for another, convert them to fiat currencies, and conduct various trading operations. The rising interest in cryptocurrencies and their benefits, such as flexibility and security, drive the market’s growth. Generally, the cost of developing a cryptocurrency exchange platform with basic features can range from $50k to $100k.
The cost of your blockchain app development project largely depends on the blockchain development company you partner with. Blockchain is an evolving technology, and your dream team should stay on top of the latest Web3 trends. Also of great importance are experience and team size. For instance, basic blockchain projects just need 4–5 specialists, including a blockchain developer, designer, backend developer, QA engineer, and project coordinator.
Large-scale projects require a bigger team of experienced blockchain developers: frontend and backend developers, DevOps engineers, security experts, legal and compliance specialists, blockchain architects, data analysts, etc. Obviously, a larger team requires more resources, increasing the final cost.
Additionally, the location of your blockchain developers also affects the cost. If your team is located in an area with a high cost of living, the blockchain development cost will be higher, and vice versa. Generally, you can pay between $50 and $150 per hour.
How much does it cost to build a blockchain app in 2023?
Generally, blockchain app development costs between $50k and $300k. However, it’s important to remember that the actual cost can vary depending on the abovementioned factors. At CyberBee, we can help you to calculate the more accurate overall cost. Our managers will take note of your budget and business needs to provide you with the best solution, balancing cost, time, and quality.
How much does blockchain implementation cost?
The cost of implementing blockchain includes expenses on project management, continuous integration, and maintenance. The complexity of the blockchain project, the chosen platform, the type of blockchain framework, the technology stack, and regulatory compliance requirements also have a substantial impact on cost estimation. Thus, the average price of blockchain model implementation starts at $3k and goes up to $5k.
How can I reduce the cost of developing a blockchain?
You can use at least two proven ways to reduce the cost of blockchain app development without compromising quality. For instance, you can use open-source platforms, such as Hyperledger Composer or Ethereum, which are free or available for minimal investments. The second option is software-as-a-service (SaaS) platforms (Blockstream Green or IOTA Hub) with subscription-based pricing models, minimizing initial costs.
How long does it take to develop a blockchain app?
The blockchain application development can take anywhere from several weeks to several months. However, it is always better to schedule a free consultation with CyberBee managers to get the exact timing of your blockchain project.