Cryptocurrencies represent a promising technological advancement as they substantially alleviate the process of money transmission, storage, conversion, etc. Transactions of bitcoins or other cryptos are regulated by an extensive peer-to-peer network with a single and shared database.
This decentralized P2P network uses an electronic digital signature and the support of a proof-of-work protocol aimed to guarantee the legitimacy of funds. In the article, we will discuss three major types of crypto exchange platforms, discover their features, and dive into the analysis of factors that determine the cost of crypto exchange app development.
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Cryptocurrency exchange is a business service, which enables the clients to sell, trade, and transfer their digital assets based on the smart contract or a traditional order book.
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The overall cost of developing a crypto exchange software from scratch will depend on the versatility of factors, including feature complexity, tech stack, regulatory compliance, etc.
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The general features of the crypto exchange app include authorization & verification, 24/7 assistance, support of different currencies, etc.
Types of Crypto Exchange
There are three main types of cryptocurrency exchange services, worthy discussion about.
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Centralized Exchange
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Decentralized Exchange
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Hybrid Exchange
Let’s dive into their essence, features, advantages/disadvantages, and cost of implementation.
Centralized Exchange
Centralized cryptocurrency exchange implies that business, or a single unit, ensures clients with exchange services that are applicable for traders and users. Additionally, this type of crypto exchange falls under the regulations of the country where the procedure is provided.
Core Features
Centralized Crypto Exchange serves as an intermediary between the clients’ purchasing and crypto trading. The CEX core features include:
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Single entity/unit ownership.
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The government over the exchange from this single unit.
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Matching between users for buying/selling orders.
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Traditional order book for exchanges.
Advantages
From the aforementioned features of CEX it is possible to define its core advantages:
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Single unit control serves as a stock exchange keeping users' assets in custody.
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CEX supports fiat currency by formulating fiat currency/cryptocurrency trading pairs. This advantage is essential as it enables the clients to exchange crypto for real money.
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Alleviated process of usability as new users have lower barriers for entrance.
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Versatility of trading variants like futures and spot trading.
Disadvantages
Regardless of the promising pros, it is worth analyzing some cons CEX contain:
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Centralized ownership imposes high fees on exchange operations.
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Enhanced risks of cybersecurity attacks.
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Since CEX is regulated by a single unit, there is a risk of fraudulent activities. The instance is FTX who manipulated users' finances for personal enrichment.
Total Cost of Development
Centralized cryptocurrency exchange app development costs from $90,000 to $120,000+. The represented price takes into account developmental components, security features, UX/UI design, blockchain involvement.
Decentralized Exchange
Unlike CEX, the decentralized cryptocurrency exchange refrains from single-unit ownership, enabling the users to conduct exchanges directly with each other. Instead of the traditional order book, this type of crypto exchange applies smart contracts.
Core Features
DEX is quite the opposite of the centralized crypto exchanges, whose main features represent:
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Peer-to-peer trading, where the clients can buy/sell crypto between each other and preserve full ownership of the finances in their wallets, excluding the involvement of the central unit.
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Non-custodial trading, which implies that the users don’t have to top up (deposit) their wallet funds, enabling them to have full control with private keys.
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Smart contracts for decentralized trading.
Advantages
The aforementioned features of DEX can be considered as its advantages as the users don’t have to rely on a third-party intermediary, which gives them full control and independence of transactions. However, other, no less important DEX advantages include:
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High level of anonymity as decentralized crypto exchange does not implement KYC.
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Does not require regulations and a license to ensure exchange.
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Lower fees for the exchange operations maintenance.
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Users are in full control and management of their assets.
Disadvantages
Although DEX show more financial autonomy for users in their exchange, buying, and selling operations, it has a few disadvantages:
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Low liquidity as it is based solely on the users; no investors are involved.
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Complicated usability, as it takes time for the novice users to get the correct understanding of DEX functionality and the risk it presents.
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The absence of fiat support as DEX offers exchanges only between crypto.
Total Cost of Development
DEX crypto exchange app development price switches between $50,000 to $200,000+. The price covers the elements of feature complexity, smart contract development, UI/UX design, security features, etc.
Hybrid Exchange
The hybrid crypto exchange represents the intertwined combination of DEX and CEX, aiming to combine the strengths of both exchanges and minimize the relevant issues, respectively.
Core Features
The hybrid crypto exchanges operate with on-chain and off-chain features:
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On-chain order books ensure the possibility of recording data audibility on the blockchain.
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Off-chain trading, which implies the high transaction to minimize latency and cut the costs.
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Liquidity pool integration means the possibility of involving investors, which increases the DEX’s liquidity considerably.
Advantages
The hybrid crypto exchanges comprise the following DEX and CEX elements, formulating the following advantages:
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Increased security, which means that the users have full control over their private keys and assets in the non-custodial wallets, having access to versatility of CEX trading options.
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Improved liquidity where by focusing on CEX possibilities, the hybrid crypto exchange does not compromise the autonomy and safety of DEX.
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Comply with regulations, as the hybrid crypto exchange integrates KYC and AML into some of its parts, remaining fully decentralized.
Disadvantages
Regardless of the presented pros, it is essential to keep in mind some disadvantages of the analyzed crypto exchanges:
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Complexity in technical development, which implies the demand for solid-for instance architecture, as well as well-established transfer between the centralized and decentralized systems.
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The scalability dilemma can emerge due to the high influx of users. This will lead to an increase in the transaction volumes, causing the lagging of performance.
Total Cost of Development
The hybrid crypto exchange development cost ranges from $40,000 to $150,000+, focusing on the feature complexity, regulatory compliances, security measures, etc. We’ll move to the development costs discussion later within the article.
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Factors Influencing the Cost of Development
While pondering over how to create a cryptocurrency exchange app, it is essential to present the development factors that affect its costs: features and functionalities, technology stack, security features, design and user experience, compliance and legal requirements, maintenance and updates.
Features and Functionalities
The overall crypto exchange app will require the following elements which complexity will determine its final price:
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Options for Deposit & Withdrawal (Basic Feature)
This feature underlines the integration of versatile payment methods, including credit cards, bank transfers, cryptocurrencies in order to ensure effective deposit and withdrawal variants.
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Multi-Currency Support & Wallet Integration (Advanced Feature)
The crypto exchange app should ensure the support of versatile wallets to promote sending, storing, etc., of different cryptocurrencies or fiat in a secure manner.
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Order Placement (Basic Feature)
The effective crypto exchange application should provide the user with the ability to perform multiple spectrum of operations, like placing, limiting, and canceling the orders. Additionally, the correct order execution and slippage prevention is a must to increase the clients’ satisfaction.
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Provision of Real-Time Data (Basic Feature)
A decent crypto exchange app has to keep the users updated on the real-world prices, as well as trade history to keep the clients’ informed to stimulate their thoughtful decision-making.
Technology Stack
Effective crypto exchange platform requires considering the technology stack or tech elements that will determine the overall process of its crafting. The core tech stack elements involve:
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Blockchain Network
The key blockchain networks used for developing the crypto exchange platforms include Ethereum, Binance Smart Chain (BSC), etc. Ethereum is recognized as one of the leading blockchain considering the token issuing and the involved smart contract. BSC is an affordable option for Ethereum as it ensures a faster and cheaper process of token production.
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Database
PostgreSQL, MySQL, etc., can be applied to ensure the maintenance of the user accounts and transaction histories.
NoSQL databases like MongoDB can be applied to ensure order book management.
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Back-End
Go, Java, Solidity, or Node.js are a few examples of programming languages required to build the cryptocurrency exchange app’s backend architecture.
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Web Frameworks
Frameworks like Express (Node.js) can assist in accelerating the overall backend development.
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Front-End
Front-end frameworks like React, Angular, or Vue.js can be utilized to handle order books as well as get real-time updates.
JavaScript (ES6+) might be applied to develop an efficient user interface.
Security Features
Security elements matter for the crypto exchange platform’s ability to ensure data safety and transactions’ efficiency.
DDoS protection represented in the involvement of the Anti-DDoS security protocol can help prevent and resolve the denial-of-service attacks.
Multi-signature wallets are a decent option to intensify the user’s cash safety.
Design and User Experience
Design and user experience elements are important for providing clients with seamless in-app operations. The important sub-elements of this category are:
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Consistent Desktop and Mobile Experiences
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Seamless Fiat and Crypto Deposits
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Two-Factor Authentication (2FA)
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Biometric Log In
These features are just a few of the expanded list of the UX/UI design elements that affect the development costs of the crypto exchange platform.
Compliance and Legal Requirements
Regulatory compliance matters for the crypto exchange apps, considering the levels of security they have to provide the clients’ data and resources. The key regulations for the identified platforms are:
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Know Your Customer (KYC)
KYC applies to verify the user’s identity. This regulatory moment matters to prevent fraud and manipulations with financial inputs.
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Anti Money Laundering (AML)
AML represents an international scope of laws aiming to prevent manipulations with finances considered as legitimate income.
Although these regulations are essential for the crypto exchange platform crafting and will affect its price considerably, one should take into account the laws of the country/state they would like to launch their business in.
Maintenance and Updates
Maintenance/updates keeps in mind the long-term collaboration with the development team after the product development and launch. The price will shift according to the specificity of the updates, required time for the development, and overall global situation with the fiat money.
Hence, the aforementioned factors will affect the development cost of the exchange app for crypto considerably due to the complexity of the features, tech stack and UX/UI sophisticated elements, local/international regulations, security elements, and maintenance expectations.
Features of Cryptocurrency Exchange App
The discussion of how to build a cryptocurrency exchange app requires taking into account features that will represent the platform’s backbone of functionality.
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User Authorization & Verification
The core element of the crypto exchange platform is enabling users access to their accounts. The subsequent elements of this feature includes username and password, 2FA (SMS or email verification), biometric authentication.
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Crypto Wallet
The overall purpose of the cryptocurrency wallet is to secure the preservation of user’s private keys for further transaction maintenance. The crypto wallets can be of two kinds: hot and cold.
Hot wallet preserves crypto in an online environment, enabling the client to receive and send tokens.
Cold wallet saves user’s private keys in an offline environment, disabling them from signing smart contracts.
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Currency Versatility
The versatility of supported cryptocurrencies enables clients to increase their investment portfolio by generating client loyalty and retention. The support of Bitcoin, Ethereum, and Litecoin can contribute to the rise in the app’s trading volumes.
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Fiat Implementation
The feature of fiat implementation implies the client’s ability to deposit and withdraw traditional currencies like EUR, USD, GBP to their exchange accounts, supporting the overall bank transfers and third-party payment processors (credit cards).
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24/7 Support
Round-the-clock support is a must to resolve the subsequent crypto exchange issues and answer users’ inquiries. The elements of 24/7 support include multiple communication support or assistance via telephone, live chat, and email. FAQs ensure that users have answers to crypto-related questions.
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Liquidity
Liquidity implies that users have access to purchase crypto at competitive prices. One of the key liquidity elements is offering trading pairs versatility, like crypto itself, fiat money, and stablecoins.
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Fee Transparency
The clarity in fee structure enables the clients to understand the overall costs relevant to the trading services, as well as deposit & withdrawal elements.
How to Develop a Cryptocurrency Exchange App: A Step-By-Step Guide
The development process of building a cryptocurrency exchange platform from scratch incorporates the following 8 steps:
1. Market Research
The market research implies conducting a thorough analysis on the overall market landscape in crypto exchange applications, defining core competitors, the features of their apps, strengths & weaknesses, clarifying the target audience, and determining the core app’s goals, functions, and subsequent features.
2. Analysis of Regulatory Requirements
This preliminary element matters not only to the crypto exchange app crafting but emphasizes how to create your own cryptocurrency. The reason is that just before initiating the development of a business in the foreign country, the enterprise owner has to take into account key legislations, acts, and core state/national level regulators to avoid any license-relevant, transaction, and money laundering activities.
3. Architecture Concept Building
Architectural concept building represents a transition from idea definition to converting it into the primary physical representation, involving the elements of design and functionality to understand the further logic of the development process.
4. UX/UI Design
The UX/UI design development represents integrating the app’s layout, ensuring the overall effectiveness of transitions between the icons and their subsequent functions. UX/UI matters for providing the clients with seamless, scalable operation and intuitive navigation.
5. Smart Contract Development
The overall progress of crypto exchange app development includes crafting features like app authentication, implementing security measures, elaborating on the logic between the inter-functional activities, like touching the button and reaching access to the app’s function.
Nevertheless, smart contract development is a must for DEX and hybrid crypto exchanges as it will automate the execution of the transactions, where the developers set the logic and rules for its further governance.
6. Testing
Testing procedures are essential to analyze whether the application works in a proper manner in terms of functional correctness, security protection, and smooth operation under peak loads. The significant testing types are as follows:
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Functional testing aims to ensure the correctness of the operation of the features during market research (idea validation).
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Performance testing checks whether the crypto exchange application can work smoothly and correctly under peak loads.
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Security testing can involve vulnerability scan and penetration testing to detect, prevent, and regulate the potential assaults that may occur in order to ensure clients’ data/assets security.
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Compatibility testing is a must to check the correctness of the crypto exchange platform’s running web, mobile, and computer landscapes.
7. Product Launch
Product launch indicates the process when the development experts upload the crypto exchange to the marketplace, involving Apple Store, Google Play and implement a marketing campaign on brand promotion.
8. Maintenance
The post-launch process represents the continuous monitoring of the crypto exchange app’s correct functionality, developing/uploading new platform’s versions, and optimizing it per clients’ feedback.
Total Cost of Cryptocurrency Exchange App Development
Now it’s time to dive into the cryptocurrency exchange development cost. Let's see what kind of specialists might be needed and the price of their services. Finally, the pricing model is dynamic and the costs represented are approximate, considering the feature complexity, security measures, developers’ country, etc.
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The Project Manager who oversees the entire process of bitcoin exchange app development.
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UI/UX designers. Their task is to create an attractive and intuitive interface for your application or site. What is the price? Well, it depends on whether you are going to undertake the bitcoin currency exchange website development, for you may be satisfied with the creation of an application alone. But if you are interested in both mobile and web versions of the program, the cost of this stage will be about $11,000.
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Services of the front-end web developer. Again, if you do not need a website, then this step can be ruled out. Its price is about $15,000.
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Mobile development services. The price starts at $60,000 for bitcoin exchange app development (for both platforms: iOS, and Android).
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Back-end services for bitcoin exchange platform development. This stage establishes interaction with databases and ensures uninterrupted operation of the server part of the app. The cost will be at least $25,000.
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QA experts are responsible for testing the program at all stages of the bitcoin marketplace development.
We’d like to note that these figures imply a rate of $35 per hour - the rate of development companies from Ukraine and some other countries in Eastern Europe. If you hire specialists from the US or Western Europe, your expenses will have significantly increased.
Learn all the reasons to hire developers in Ukraine.
Choose Agilie as Your Crypto Exchange App Developer
Crafting a crypto exchange application from scratch requires identifying the core project’s needs and demands to ensure its full alignment with corporate goals. Selecting the right development partner is quite an essential moment to make sure the product will be delivered on time and ensure a profound quality and exceptional user-centricity. In the image below, we would like to share a few tips on how to choose the right development partner.
For over 14 years, Agilie has been writing its story in crafting from scratch and optimized digital solutions for a vast pool of domains, including fintech, marketing, real estate, health care, media, and e-commerce. Our expert areas include blockchain development, mobile banking, payment options, and fintech.
Here is the list of our services where we recommended us as a pioneer development company:
| UX/UI Design Services: | Web Development Services: | Mobile Development Services: | Blockchain Software Development Services: |
| Mobile Design | Custom-Built Web Solutions | Native iOS App Development | Blockchain Development |
| Web Design | Enterprise Web Solutions | Native Android App Development | Cryptocurrency Development |
| Redesign | Solutions for Marketplace & E-Commerce | Cross-Platform App Development | Crypto Wallet App Development |
| Wearables and Embedded Software | Smart Contract Development | ||
| Progressive Web App Development | NFT Tokens Development |
Our services are worthy of attention due to tech sophistication and originality in applied solutions. Nevertheless, our portfolio on crypto exchange applications development is our top priority. Here are a few cases of our dedicated expertise:
Level01
Based on the Ethereum blockchain, Level01 is a P2P decentralized platform, which provides users with the ability to create and manage their crypto wallets and save coins on them. Agilie worked with Level01 and crafted a cross-platform solution for the application’s possibility to support both iOS and Android environments.
What is more, we solved the challenge with smart contract integration. Our team of experts solved the issue of AI inclusion within smart contract development. Agilie team preserved the AI prediction data inside the smart contract awaiting the further model optimization.
Chameleon Pay
Chameleon Pay is a multi-currency digital wallet, which enables clients to store, receive, convert cryptocurrencies like Bitcoin, Ethereum, etc. Agilie team elaborated on the project from scratch where one of our top significant achievement was the diversification of blockchain network in order to support and integrate multiple crypto.
The integration of the NativeScrip framework was central in our development of two platforms where our development professionals did not have to alter the native code, while still being able to write new features.
Conclusion
The article discussed the cost to start a crypto exchange app development and its three major types: CEX, DEX, and hybrid cryptocurrency exchange. The key moments to keep in mind are that the feature complexity, regulatory compliance, tech stack, and UX/UI design represent those factors that would affect the ultimate price of the crypto exchange platform. Finally, selecting a reliable development partner will benefit your project development, considering goal alignment and its high quality supported by the partner’s years of experience.
