Blockchain Solutions Implementation: How Much Does It Cost In 2020?
In 2020, after bitcoin price hit its all-time high in Dec 2017, the term blockchain does not receive as much hype like it used to do back then. However, it’s an undeniable fact that blockchain technology is here to stay.
Blockchain technology, indeed, has a great impact in the new digital economy. For instance, with cryptocurrencies, users do not have to rely on another third party or intermediaries such as a bank or financial institution for international money transfer. This eliminates additional complicated paperwork and/or processing fees.
In addition to Crypto Currency, Blockchain Technology is currently being adopted by companies in various business industries to securely record, store, and transmit data effectively - solving many business issues including security and transparency - thanks to its distributed and digital characteristics.
Read more about: Top 5 Benefit from Blockchain Development for Businesses across Industries
In 2020, Blockchain technology is still evolving, and now is still a good time for businesses to consider adopting Blockchain to optimize and transform their business processes, achieving their digital transformation objectives.
When it comes to developing blockchain based solutions (e.g. Blockchain based platforms, Cryptocurrencies, Crypto Trading Platforms, etc.), the most commonly asked question is usually how much does it costs and how to acquire the sufficient human resources to build such blockchain solutions.
So, in this article, let’s examine in details on the development of blockchain solutions and the factors which influence the development costs.
COST OF HIRING BLOCKCHAIN DEVELOPERS
First of all, if your businesses are not in the IT industry, then you’ll need to hire Blockchain developers or software development companies to help build your application.
For starters, there is a distinguishing about two different kinds of blockchain developers:
- Core Blockchain Developers: Responsible for designing the architecture and security of a typical commercial blockchain solution.
- Blockchain Software Developers: Building decentralized applications (dapps) and smart contracts based on the foundation and architecture created by the core Blockchain developer.
As stated in our previous blog posts, in the US market alone, blockchain developers are among the most sought after IT professionals who command, on average, an annual salary ranges – according to indeed.com – from approximately $79,583 per year for Engineer to $107,851 per year for Software Engineer.
Furthermore, according to Toptal.com, the average hourly rates which skilled freelance blockchain developers charge is from $55/hour which translate to an annual earnings of $100,100.
Thus, it’s costly and not an easy task to hire experienced blockchain developers since many companies are vying for the same candidate in the local market.
This leads many companies in the US and western markets to outsource their blockchain projects to offshore software companies in order to reduce development cost. Among the most popular destinations for blockchain development outsourcing are Vietnam, India, and other Eastern Europe countries such as Ukraine and Poland.
At TP&P Technology, we leverage our on-shore and offshore delivery capacity to provide clients with affordable blockchain development solution without compromising quality, ensuring standards are met while staying within budget and deadline.
In order to efficiently outsource blockchain development, in addition to engineers and developers, you may need to hire a full remote development team including project managers and QA/testers. Similarly, the hourly rates for those personnel are much lower in comparison to their US counterparts.
According to the B2b market site Clutch.co, specifically for Vietnam blockchain developers, the hourly rate starts around below $25/hr.
HOW MUCH DOES IT COST TO CREATE A BLOCKCHAIN BASED APPLICATIONS
Generally speaking, blockchain technology, as a whole, is still evolving and still hasn’t reached its maturity stage. Creating a robust Blockchain solution will take time, effort and may also require compliance with various regulations and laws.
Let’s consider various factors which influence the overall cost of building and running a typical commercial blockchain solution, including implementation, deployment and launching:
- Hiring team of Blockchain experts
- Development of the commercial blockchain solution
- Deployment and on-boarding
- Sales and marketing
- Monitoring and Maintenance
- Other legal aspects
The team of experts is essential. To successfully launch a coin on the market, you need a team of advisors in marketing, software developers, cybersecurity specialists, PR managers and so on. These people will help you find investors to give credibility to the project. Also, it is necessary to find an advisor in cryptocurrencies to guide you through the market. Communication with your target customers is also critical.
A team of blockchain expert is crucial to help you build a robust blockchain solution. Next up, you will need to decide on how you’re going to deploy the solution and onboard new users. To successfully release your blockchain based product into market and earn a profit at scale, you will need a team of sales and marketing, business advisors, cyber security, as well as legal advisors for potential legal implications, and so on.
To develop a blockchain solution from scratch, along with testing and deployment, the process could take months or even more, depends on your unique business requirements. The overall development cost alone – without sales and marketing as well as other administrative expenses – could be estimated according to hours taken multiplies based on the hourly rate as above.
Contact TP&P Technology today to discuss your blockchain project!
In many cases, a blockchain solution would involve handling customer’s data and personal finances. As a result, you will need to carefully consider all the legal ramifications (such as AML and KYC) when launching and promoting your blockchain based products.
It is also essential that you can communicate the benefits of your blockchain solution, and provide added value as well as catering to the need of your target users to maximize the likelihood of success for your blockchain project.
FACTORS TO CONSIDER BEFORE IMPLEMENTING BLOCKCHAIN SOLUTION
The cost of developing a blockchain based solution will vary significantly based on numerous factors, such as number of functionalities required and the complexity of implementing them, blockchain platforms, and tech stacks required. Consider the following factors to identify your blockchain requirements:
- Integration requirements: is the new blockchain solution going to be integrated with existing system? – Complex integration scenarios may incur extra development costs and time.
- Is an MVP or PoC needed?
- Private vs. public blockchain.
- How is your blockchain solution going to be deployed and hosted?
- Estimated number of users – which influence volume of requests, transactions size and volume leading to additional capacity of IT infrastructure requirements.
The above factors directly influence the blockchain application strategy and subsequently, the overall development cost. Carefully identify and answers those questions will allow you to arrive at a more accurate cost estimation of your blockchain project.
CONCLUSION
Blockchain technology is still progressing, evolved from the main purpose of facilitating digital transaction in the form of cryptocurrencies, into a highly scalable distributed platform that can solve various industry specific problems.
There are many use cases for blockchain applications where each solution will require a different specialized technological, and implementation approach. In terms of cost, there’s no exact answer on how much it cost to create a blockchain solution – this largely depends on blockchain requirements.
For starters, you can consider developing an MVP for your blockchain solution starting around $5000, then moving on to a full-scale solution which can cost upward of $100,000. However, the overall blockchain development cost will differ based on specific project requirements, including the number of functions need to be incorporated into the solution, as well as how complex they are.
Equally importantly, for a commercial blockchain solution to succeed, you will also have to take into account other costs such as sales and marketing, on-boarding, cloud hosting (optional), and other legal expenses, as well as maintenance.
Contact TP&P technology today to discuss your blockchain project requirements.
