Today, cryptocurrency-backed payments can be made alongside any other online payment method using blockchain technology. Governments, banks, and corporations do not have control over cryptocurrencies. As a result, they can be used as an alternative to traditional financial instruments.
Cryptocurrency is any form of currency that is not controlled by any authority and is based on blockchain technology. This task is distributed among all users of a specific digital coin around the world. Blockchain is critical for such assets because it allows for autonomous operation processing and authentication.
What Is the Definition of a Cryptocurrency Wallet?
All coins and tokens are stored in a special location known as a "crypto wallet." It is also an ideal location for storing private keys that allow everyone to access digital funds. Users can trade cryptocurrency with one another. These passwords serve as proof that you keep your assets safe and enable you to send and receive payments securely.
A Over 82 million people have registered in a crypto wallet app for Bitcoin, Ethereum, Tether, and other coins or tokens, according to Statista.
Wallet Types in Cryptocurrency Development
There are two types of solutions: custodial (centralised) and non-custodial (decentralised). Let us examine them more closely.
Custodial wallets are designed to securely store passwords and crypto coins. Maintenance is provided by a third-party organisation that created such storage. Custodial solutions have two distinct advantages: easy password recovery via identity confirmation and low transaction costs. However, such a wallet necessitates a consistent internet connection.
Non-custodial wallets give you complete control over your funds. You can manage all activities whenever it is convenient for you. Most importantly, each transaction necessitates authorization via your passwords.
Before we get into how to make a cryptocurrency wallet, let's talk about the different types from a development standpoint.
Types of Crypto Wallets
First, you must select a wallet style. There are two types of solutions: custodial (centralised) and non-custodial (decentralised). Let us examine them more closely.
Custodial wallets are designed to securely store passwords and crypto coins. Furthermore, the storage is maintained by a third-party organisation. Custodial solutions have two distinct advantages: easy password recovery via identity confirmation and low transaction costs. However, such a wallet necessitates a consistent internet connection.
Non-custodial wallets give you complete control over your funds. As a result, you can manage all activities at any time that is convenient for you. Most importantly, each transaction necessitates authorization via your passwords. Nonetheless, you should remember a seed phrase (12-24 word string) that gives you access to your digital asset wallet. If you forget the mnemonic phrase, you will never be able to recover your cryptocurrency.
Before we get into how to make a crypto wallet, let's first discuss the various types of such solutions.
Applications for the Web
These are web apps or websites that allow you to access your cryptocurrency assets. There is no need for additional software because you can use an application in the browser. Furthermore, most online wallets store private keys that allow you to manage your cryptocurrency.
Applications for Mobile Devices
You only need to download and install an app. It enables you to carry out any cryptographic operation. In many cases, a mobile application generates QR codes for quick buy-and-sell transactions. However, more security is required to protect crypto wallets from malware and viruses. To prevent asset theft, security experts recommend using multi-factor authentication and backing up your private keys.
Applications for Desktop
This software must be installed on your computer. In contrast to some online solutions, a desktop app gives you complete control over your cryptocurrencies, but you must follow basic security precautions (e.g., using antivirus).
Hardware gadgets
In this case, a specific USB drive is used to securely store private keys. To manage your assets, you must connect it to a PC or laptop. It is the only way to access your funds and keep them safe from cybercriminals. As a result, a hardware wallet is one of the safest ways to store coins and tokens.
Wallets Made of Paper
It is, as the name implies, a piece of paper with two QR codes printed on it: a wallet address and a private key. To send or receive crypto tokens, you should scan these codes.
When it comes to crypto wallet development services, most people use them to create digital apps. They run on a PC, laptop, or phone and allow users to store coins, make payments, and transact with other users in digital assets.
Millions of people use wallet apps to store cryptocurrencies purchased on exchanges or mined through a mining pool. Discover more about Omninos's secured pool.
Developing a Wallet App: Key Features
When you add some high-quality tools and technologies, your wallet becomes simple and dependable for users. Here is a list of the features that every cryptocurrency wallet developer considers essential.
Authorization
When considering how to create a cryptocurrency wallet, one of the most important factors to consider is authorization. When registering, it requires two-factor authentication (2FA) and Google Authenticator as an added layer of security.
Support for Multiple Currencies
For the time being, many businesses want to enter the global market. And cryptocurrency apps are ideal for carrying out all trading operations.
Notifications via Push
Pop-up messages about price fluctuations, achievements, technical glitches, and so on can be sent by digital wallets. It allows users to keep track of updates to their account activity.
Updates in Real Time
Any user can view the current currency price. As a result, anyone can use digital crypto solutions to operate with hundreds of coins in various modes.
Import of Paper Wallet
You can quickly scan the QR code with the Android or iOS app, connect your paper wallet password, and use it to make transactions.
In-App Management
The most useful feature is the ability to perform quick and secure operations. You can send or receive cryptocurrency almost instantly.
What Influences the Development Cost of a Cryptocurrency Wallet?
The final cost of developing a crypto wallet is determined by four key factors.
Creating a crypto wallet is a long-term investment because a business can profit from transaction fees, currency conversions, and advertising.
Model of Growth
The two main development models are White Label and fully-customised wallet.
A White Label application has a ready back-end and customizable front-end parts. It greatly simplifies the deployment and launch of a cryptocurrency product. White Label apps are popular among businesses and individual users due to their lower development costs, accessibility, and shorter time to market.
High-end features are supported by a White Label crypto wallet:
Quick access and recovery phrase (from 12 to 24 words);
Multisignature as an additional security level for operation authorization;
Hundreds of digital coins and tokens are supported;
Paper wallet scanner for easy import;
Quick in-app transactions
Automatic logout for greater data and financial security;
2FA using a password and a phone, email, or Google Authenticator;
Computer and smartphone compatibility;
Coin prices are automatically updated, and conversion rates are calculated.
Developing a fully customised solution from the ground up enables businesses and startups to implement unique features tailored specifically to their business requirements.
Features
This factor is critical in determining the final budget for creating digital storage. The higher the cost, the more features you intend to implement.
A White Label wallet comes with a set of features. It means that depending on the level of customization you require, the budget will be larger or smaller than the preliminary cost set by the development team.
A cryptocurrency wallet created from the ground up, on the other hand, has no fixed cost. In this case, a development team will set an initial price, which may change once you have decided on your features.
Number of Crypto Assets Supported
Each digital asset has its own timetable for integration into your wallet. The more coins or tokens your solution must support, the larger the budget required.
Mechanism of Consensus
A consensus mechanism (also known as a consensus algorithm or protocol) enables cryptocurrencies and distributed systems to collaborate. Furthermore, it aids in the prevention of certain cyberattacks (for example, a 51% attack). Blockchain supports a wide range of consensus mechanisms, including: Proof-of-Stake (PoS), Delegated Proof-of-Stake (PoW), Proof-of-Elapsed-Time (PoET), and so on.
The Mechanism of Consensus
A consensus mechanism (also known as a consensus algorithm or protocol) enables cryptocurrencies and distributed systems to communicate with one another. Furthermore, it aids in the prevention of specific cyberattacks (for example, a 51% attack). Blockchain is compatible with a wide range of consensus mechanisms, including: Proof-of-Stake (PoS), Delegated Proof-of-Stake (PoW), Proof-of-Elapsed-Time (PoET), and other methods are used.
Cost Estimate
You can select a software development firm from any country. However, experts advise you to look further east, to dedicated teams from Eastern Europe. They can create high-end crypto wallet apps at a low cost.
There is an average hourly rate for each employee group, as well as an average time to develop a wallet application (according to Accelerance and Upwork):
Department Average rate, $ Hourly rate
Let's look at a rough calculation for a medium-sized team. It is based on the following data:
$6,000 for a business analyst
Backend $10,000
Android $32,000 \siOS $28,000
Web/Desktop $7,000 \sDesign $7,000
Project Management/Quality Assurance
$5,000
Blockchain $10,000
Total $105,000
As a result, based on the most common features, the approximate budget for creating a crypto wallet app will be around $105,000. However, after hiring a development team, you will know the total cost.
Conclusion
Creating a cryptocurrency wallet is a long-term investment because a company can earn commissions on transactions, currency conversions, and advertising.
Omninos assists businesses throughout the development process, from discovery to product launch and further scaling. Fintech and cryptocurrency solutions are among the 12 market expertise domains we handpicked and continue to master with each project. Please contact us for more information and an estimate.
