From a buzzword to an invaluable business tool, blockchain has rapidly become a game-changer across all industries. FinTech, supply chains, healthcare, and even government tax monitoring — these sectors surely benefit from shared, digital ledgers.
Despite common misconceptions, blockchain is not just about cryptocurrencies and shadow money transfers. In fact, this technology is projected to become a $94 billion market by 2027. So, if you’re interested in how to develop blockchains, where do you start?
In this blockchain development guide, we’ll explore the process of making a blockchain, debunk some of the myths around this technology, and share insights based on our experience providing blockchain development services. With numerous blockchain-related projects under our belt, Unicsoft is here to answer your burning questions.
What’s inside the blockchain?
Imagine a chain of blocks, with each containing data that is impossible to change. This is your blockchain. Physically speaking, a blockchain is a chain of computers linked together to substitute a more traditional server.
Each block in a blockchain contains:
Data – all details about the block and information to be stored
a hash – a unique digital “fingerprint” that identifies a block
A hash of a previous block – the one that creates a digital block and secures the whole blockchain
Blockchains can be:
- public (anyone can access them),
- private (authorized users send invitations to join),
- consortium (usually used by a network of business organizations, which is highly popular in the finance sector).
Apart from blocks and chains, you should know three more keywords in the blockchain basics — transaction, node, and miner.
- A transaction is the smallest block of records inside a blockchain.
- A node stands for one user or one computer inside the blockchain system.
- A miner is a node responsible for block verification (before this block gets added to a blockchain structure).
How can blockchain help my business?
As blockchain is very much transaction-oriented, so its key benefits are also about transactions (financial and not only). Blockchain makes transactions:
- More transparent
- More traceable for all the participants involved
- Cheaper and quicker
There are some other solid reasons why use blockchain, like:
- No risk with unreliable parties: all transactions are validated by the network, making it more secure and reducing the risk of fraud or errors
- Reduced commission costs: there’s no need for intermediaries, such as banks, resulting in lower transaction fees and commission costs
- Privacy: secure, encrypted transactions protect the privacy of all parties involved
Not to sound too abstract, let’s have some real-life examples.
First and foremost, blockchain is used for money transfers and other asset exchange purposes. It is secure, quicker (instant, actually), and much cheaper than any alternative transfer method.
Medical institutions use blockchain applications to send and receive sensitive medical information.
Blockchain helps artists instantly receive royalty payments for their creative work. Spotify is probably the best-known example of this arrangement.
Enterprises and charitable organizations work on blockchain to organize and perform secure and anonymous auctions to sell valuable assets.
The list could go on and on.
In a nutshell, if you need to set up online transactions that are transparent and secure, blockchain is always a solid option to consider.
What is a blockchain proof of concept?
When learning how to build blockchain, you don’t want to miss the blockchain proof of concept (PoC). It’s a crucial step in blockchain development that allows you to test your initial project idea and determine its feasibility.
A proof of concept is essentially a small-scale demonstration of what you’re planning to build. It must show that the proposed blockchain solution will work as intended. Other benefits of making a PoC before developing a full-fledged blockchain include:
- Reducing the risk of developing a solution that ultimately fails to meet the needs of its intended users
- Saving time and resources by identifying and addressing issues early in development
- Helping define the development team’s goals and tasks more clearly
Ultimately, a good PoC paves the way for successful full-scale blockchain solution development and implementation.
What are the main types of blockchain solutions?
As we mentioned earlier, there are many real-life examples of blockchain solutions across industries. Let’s look at some more applications in different sectors:
- Healthcare. Organizations use blockchain to securely store and share sensitive medical information, track pharmaceutical supply chains, and enable faster and more accurate diagnoses.
- Education. Educational establishments leverage blockchain solutions to create secure and tamper-proof student records, verify academic credentials, and facilitate secure payments for tuition and other fees.
- Real estate. Companies may use real estate blockchain-based solutions to streamline real estate transactions, reduce fraud, and enhance transparency in property records.
- Agriculture. Some common use cases may include tracking the origin and journey of produce, enabling greater transparency and accountability in the supply chain, and helping prevent food fraud and contamination.
- Banking. Blockchain facilitates faster, cheaper, and more secure cross-border payments, streamlines Know-Your-Customer (KYC) and Anti-Money Laundering (AML) compliance, and enables peer-to-peer lending and other financial services.
- Supply chain management. Some blockchain solutions in this industry might help to record all transactions and procedures, ensure the authenticity of goods, and enable real-time tracking of shipments.
- Enterprises. Companies can create transparent and secure supply chain records, improve inventory management, and automate contract execution, owing to blockchain solutions.
- Factoring. Blockchain can automate and streamline the factoring process, enabling faster and more secure invoice financing.
- Payments. Organizations can use blockchain to reduce transaction costs, create decentralized payment systems, and enable fast and seamless cross-border payments.
- Insurance. Organizations in this niche may leverage blockchain-powered solutions to automate claims processes, reduce expenses, and verify the authenticity of claims.
- Gaming. Companies can delve into developing decentralized gaming platforms, allowing players to trade in-game assets and securing all transactions.
What are the key steps in a blockchain development process?
If you want to implement one of the blockchain solutions, learn how to create blockchain infrastructure first. After determining key objectives and formulating subtasks, move on to the following critical steps:
Step 1. Feasibility study
You don’t want to initiate blockchain development before defining whether it will actually yield profits for your business. That’s why you should analyze your requirements and the market, as well as identify the potential risks.
How to figure out if blockchain is feasible? If you deal with a continuous supply of assets and sensitive documents, have loads of accounting-related tasks, or simply don’t want to depend on third parties — the development will likely benefit your company.
Step 2. Blockchain conceptualization
After ensuring blockchain software development is a good idea for your business, proceed to the conceptualization stage. This process involves the following:
- Choosing a blockchain architecture (a private, public, or consortium blockchain)
- Choosing a consensus mechanism (there are many, from Proof-of-Work and Proof-of-Stake to Proof-of-Authority)
- Choosing a blockchain platform (you can develop your own from scratch or modify an existing one; this process is also called forking)
Other considerations include development methodology and tools, programming languages, and project timelines.
Step 3. Blockchain development and QA
Once you’ve conceptualized your blockchain solution, the development team will build it. They will create smart contracts, design the user interface, work on the back end, and integrate the blockchain with external systems, if necessary.
You also need to ensure your blockchain solution’s flawless operation. So here comes the QA stage. Your team must carry out extensive quality assurance testing to ensure the developed blockchain meets the specified requirements.
Step 4. Full deployment
At this stage, your blockchain is ready for deployment. All you need to cover is configuring the blockchain network, deploying the smart contracts, and connecting your blockchain solution with the required nodes.
What tools are available for blockchain development?
Even if you already know that you will be outsourcing the whole blockchain development process, you still need to know the jargon and the key tools for blockchain development.
Solidity and Go (also known as GoLang, where Lang stands for “language”) are the two most common stacks used in blockchain development technology. Both are perfect for smart contracts and Ethereum blockchain platforms. Some developers would insist, though, that Python is the preferred language for smart contracts.
Geth — an Ethereum client that is used to run the nodes. It works equally well with Mac, Windows, and Linux. Once you have it downloaded and installed, you can create a new blockchain or link yourself to an already existing one.
When a blockchain runs on Ethereum, it needs a place to store tokens. The most well-known wallet is Mist; the Ethereum developers themselves once created it. Tresor and Ledger are often the most frequently mentioned alternatives.
Truffle Suite is a development environment and a testing framework for Ethereum works. Amazon, Microsoft, Airbus, and Starbucks — all these companies are using blockchains developed in Truffle.
Other critical blockchain development tools include those that help streamline DevOps processes, such as Docker, Kubernetes, and GitLab.
What are the hidden pitfalls and challenges in the blockchain development process?
Like any other sophisticated project, blockchain development might fail due to several misunderstandings or estimation mishaps. The most typical of them include the following:
- Building on a public blockchain instead of developing a private one from scratch
- Assuming that blockchain is a complete business solution in itself
- Using blockchain simply as cloud storage, disregarding its transaction properties
- Ignoring potential legal and governance issues
- Finally, banal FOMO — the fear of missing out and launching a blockchain project without a clearly written objective just because every competitor is doing it
Ever heard of the “blockchain trilemma”? These are the three other biggest problems businesses may encounter during blockchain development:
- Decentralization. While being one of the most sought-after reasons for building a blockchain, blockchains pose a significant challenge for the development team. Decentralization requires the network to reach a consensus on each transaction, and all nodes must validate each block of data added to the chain, making it a hard-to-implement feature.
- Scalability. As the number of users and transactions on a blockchain network increases, the system’s performance can degrade, causing delays and higher transaction fees. Blockchain developers face yet another challenge, deciding whether to increase block size without compromising processing speed.
- Security. Although blockchain is seen as a secure technology owing to cryptography and consensus mechanisms, it’s still vulnerable to hacking, data breaches, and fraud. Thus, developers must take robust security measures to ensure the blockchain network’s integrity.
How much does blockchain really cost?
The cost of a blockchain always depends on two key factors — the complexity of a project you have in mind and the way in which the blockchain would be developed.
You can organize blockchain development in at least three ways:
- Hiring developers in-house (usually recommended for data-sensitive projects)
- Hiring freelancers
- Hiring a blockchain technology development company
Speaking about the project-related factors that influence the cost, you should definitely consider the following:
- Blockchain architecture type (private, public, or consortium)
- Consensus mechanism type used
- The number and complexity of functional modules (dApps, smart contracts)
- The number and complexity of web/mobile applications used
- The number and complexity of integrations via APIs
Very rough estimations of a blockchain budget, as of 2022–2023, range between $30,000 and $250,000.
Costs are lower in the cases of public blockchains that heavily rely on open source code. However, only a few businesses would find this solution comfortable enough for their purposes.
How long does it take to make a blockchain?
Again, this depends on the complexity of the project itself.
Developing the proof of concept usually takes from two weeks to two months.
The launch might take up to three months.
The timing can be extended if you hire several freelance developers working from different places. In most cases, hiring a readymade team from a blockchain technology development company would be the fastest option.
Is there a one-fit-all solution?
You won’t make any mistakes if you opt for the most standard tools in your blockchain development tech stack.
All other things won’t be universal, though, and need to be thoroughly discussed. One of the reasons why hiring a dedicated team from a blockchain technology development company is always a good idea if you are planning to use blockchain for business purposes.
Unicsoft is a leading blockchain development company trusted by many customers from all over the world. We have successfully delivered over 200 projects and continue to drive blockchain-related businesses in the Web3, NFT, P2E, and DeFi niches.
Our expert development team knows everything about how to build blockchain applications. We build NFT marketplaces, blockchain and Web3 games, factoring solutions, private blockchains, track-and-trace solutions, and smart contracts, among others.
On top of that, Unicsoft provides blockchain consulting services, which may help you devise the best-suited blockchain solution for your business. As part of these services, we offer the following:
- Product discovery
- Blockchain proof of concept development
- Product scaling
- Product roadmap
- Assessment of your blockchain’s potential
- Blockchain deployment and integration
And when we say our blockchain development services are unparalleled, we don’t mean for you to take our word for it. Recognized by leading industry experts, Unicsoft has earned the title of the top blockchain development company, according to Clutch and GoodFirms.
With our team’s expertise and recognition in blockchain development, it’s no surprise that we’ve been able to create successful solutions for our clients. Here are some case studies of our work in action:
- Gold supply chain management system. Our team built a web and mobile app that integrates with the private Ethereum network to facilitate gold bar production and supply chain management. The solution allows for end-to-end gold tracking owing to the bespoke system registering every chain operation.
- Factoring solutions for blockchain technology. Another project we worked on involved building a web platform for invoice factoring. Our experts used Ethereum and Parity to implement the Proof-of-Authority consensus mechanism and enable smart contracts. As a result, our client has accelerated request processing and decreased operation costs.
These are just a couple of examples of our cutting-edge blockchain-related projects. Follow the link to take a closer look at our extensive portfolio.
Although creating a blockchain might be challenging, it will drive your business forward with the right team and approach. Hopefully, this blockchain development guide has helped you figure out how to revolutionize your company with this cutting-edge tech.
And if you still have questions or doubts, let us clear them out!
If you aim to elevate your business to the next level, look no further. With Unicsoft, a leading provider of blockchain development services, you can enhance transparency, security, and efficiency in your transactions. Don’t hesitate to contact our team to learn more about how blockchain can benefit your business.
Is blockchain easy to develop?
Due to its decentralized structure and the demand for advanced cryptographic algorithms, blockchain application development might be challenging. It also presents development difficulties like the need to ensure security and scalability. Nevertheless, with the help of experienced developers and proper tools, it’s possible to build top-notch blockchain apps.
How much does it cost to develop a blockchain?
The complexity of the project and the engineering team’s experience dictate the cost of blockchain development. As a result, the final price ranges from $30,000 to $250,000 and above.
How long does it take to develop a blockchain?
As with the development cost, the timeline may differ significantly depending on the project’s complexity and the dev approach. On average, a full blockchain deployment takes several months.
How can blockchain implementation help my business?
Blockchain development offers several benefits for businesses, including increased transparency, improved security, reduced transaction costs, and faster transaction processing times. It also helps companies ensure privacy and eliminate risks with unreliable parties.
What is the difference between a public and a private blockchain?
A public blockchain is open and accessible to everyone, while a private one is restricted to a specific group of participants. The use cases of public blockchains are typically limited to cryptocurrencies. Conversely, private ones are commonly used in enterprise settings where data privacy and control are a priority.