Get to Know How Much Blockchain Development Costs

Key factors impacting blockchain development cost

• The type of blockchain solution to develop.
• The complexity of solution features, including capabilities enabled by smart contracts.
• Performance, security, and interoperability requirements for the blockchain solution.
• Compliance requirements (for blockchain apps targeting regulated industries or planning to achieve certifications).
• The number and specifics of interfaces (web, mobile, desktop) for various user groups.
• Technical design patterns (e.g., the chosen tech stack and the approach to blockchain network development).
• The chosen sourcing model (all in-house, partial outsourcing, or full outsourcing).

Costs by Blockchain Development Project Stage

Here’s a typical budget breakdown based on ScienceSoft’s experience in blockchain development projects:

1. Software conceptualization

Around 10% of the project cost

Key activities: business analysis, market and target audience research, feasibility study, engineering business and regulatory compliance requirements, creating a functional specification, and scoping the project.

NB: In Agile projects, this stage can run in parallel with design, development, and QA stages.

2. Blockchain software design

5–15% of the project cost

Key activities: designing software architecture and logic (including smart contracts), planning integrations, selecting the tech stack, and designing UX and UI.

NB: Cost-saving decisions made at this stage can reduce the development budget by up to 12x.

3. Development

40–60% of the project cost

Key activities: setting up the development infrastructure, back-end development (including smart contracts, APIs, cross-chain bridges, and oracles), front-end development, and setting up off-chain data storage.

4. Integration

10–25% of the project cost

Key activities: blockchain solution integration with the necessary company’s and external systems. The final cost will depend on the number and complexity of integrations.

5. Quality assurance

15–20% of the project cost

Key activities: functional, security, usability, integration testing, pre-launch compliance audit.

6. Setting the solution live

Around 5% of the project cost

Key activities: setting up the production infrastructure, implementing data backup and network security mechanisms, and deploying the solution to the live environment.

7. Support and maintenance

15–20% of the initial project cost yearly

Key activities: monitoring the blockchain solution’s performance, security, and compliance, resolving issues, evolving software with new features, providing user support.

How to Optimize Blockchain App Development Cost

Here are some of the practices we use to reduce blockchain project budgets without affecting the solution’s quality and security:

• By investing time in requirement engineering at early planning stages, we compose a clear solution and project scope, which helps us avoid scope creep and costly changes later on.
• Adopting Agile methodologies and PM best practices fosters quicker development and efficient resource use.
• Applying pre-built smart contract templates, blockchain development SDKs, and open-source integration solutions helps speed up development and reduce custom coding efforts.
• Opting for platform-based blockchain solution development (e.g., on the IBM Blockchain Platform or Oracle Blockchain Platform) where feasible is a way to avoid extensive investments in coding from scratch.
• Running QA activities in parallel with coding helps detect potential issues quicker and avoid their costly resolution at later stages.
• Implementing automated testing of smart contracts helps drive quicker and more reliable testing cycles, reducing manual errors and lowering QA costs.
• Building the blockchain solution on an L2 network, optimizing smart contract code for gas efficiency, and implementing off-chain data storage are our proven practices to drive lower transaction fees and reduce blockchain solution operational costs.

Why Develop Custom Blockchain Software: Market Insights

The global blockchain technology market is projected to grow at a CAGR of 52.8% and hit $825.93 billion by 2032.

For enterprises, custom blockchain development is a way to eliminate counterparty risks and leverage tailored features not available in commercial tools. According to research by Blockdata, 81 of the world’s top 100 public companies are piloting blockchain, with 27 of them already having a fully functional custom blockchain solution.

For startups, the rising adoption of blockchain presents an opportunity to enter a fast-growing market. As blockchain technology is maturing, it becomes easier for startups to secure funding. The same research by Blockdata revealed that 36 of the top 100 public companies have invested a collective $3.5 billion in over a hundred blockchain companies.