How Much Does It Cost to Build a Cryptocurrency Wallet App?

Since the emergence of the first cryptocurrency, Bitcoin, blockchain technologies have increasingly become an integral part of the world of finance and financial technologies. The main idea behind cryptocurrencies is the decentralization of financial transactions and providing free access to the storage and payment system for any financial activity entity.

As of 2024, the number of cryptocurrency wallets worldwide has approached 92 million (Coinweb). This is due to the global integration of cryptocurrencies into international financial transactions. More and more mobile device users are focusing on the possibility of using cryptocurrency in their daily lives, not to mention those involved in investment activities.

Today, leading economies such as the USA and Europe are beginning to address the issues of cryptocurrency recognition and regulating their circulation in order to ensure reliability and security for ordinary citizens, as well as prevent illegal activities like money laundering and similar operations. An increasing number of countries recognize crypto-assets as illegal financial assets. Singapore, the UAE, and Germany not only recognize cryptocurrencies as a unit of financial accounting but also provide simple mechanisms for legal regulation and tax incentives for all participants in the financial crypto market (Myglobalviewpoint, Cryptorisen).

Major players in the financial market, such as JPMorgan Chase (Coinbase), BNY Mellon, Citigroup, Wells Fargo (Cointelegraph), Goldman Sachs (Businessinsider) are investing in blockchain-based startups, creating their own cryptocurrencies, and using blockchain technologies for conducting financial transactions.

Blockchain technologies and financial operations are predictably moving toward total integration into everyday life. Therefore, the creation and use of crypto wallets is no longer just a trend or innovation. These applications are heading in the direction of becoming a part of our daily technologies, like search engines, banking apps, or email.

Therefore, the task of creating software solutions for cryptocurrency operations is a highly relevant issue that an increasing number of software development companies are beginning to address.

The tool for the end user of cryptocurrency is the crypto wallet, and the nuances of its development are what we will discuss in this article.

What is a crypto wallet? 

Crypto wallet is a software system that enables the end user to interact with the blockchain.

The essence of a crypto wallet lies in creating an interface between the user and the blockchain, as any cryptocurrency is always stored within the blockchain it cannot be extracted, moved, or deleted from it. Essentially, a crypto wallet is a tool for managing blockchain record addresses and controlling access keys to these addresses.

With a crypto wallet, the end user can perform the following operations:

• Check the balance of their crypto assets,

• Transfer crypto assets to other users and receive transfers from them,

• Exchange one cryptocurrency for another,

• Convert cryptocurrency into fiat currency, etc.

Depending on where and how the access keys to blockchain records are stored, crypto wallets can be of two types:

1. Custodial wallets imply that access key information is stored by third parties, such as a cryptocurrency exchange, which facilitates access to funds and the execution of any transactions. There is a risk that exchanges may be vulnerable to hacking attacks, potentially leading to partial or complete loss of funds.

2. Non-custodial wallets mean that the user stores the access keys to their funds on their own device, taking full responsibility for the security and access to their blockchain assets. The risk here is that if the keys are lost, the asset owner will have no way of accessing their funds.

Depending on the method of wallet implementation and subsequent access to the blockchain, wallets are categorized into hot wallets and cold wallets.

Cold wallets are physical devices used for storing crypto assets. These can be:

• hardware devices (Ledger Nano X, Trezor, an external USB-compatible physical device) or 

• "paper wallets" (A paper wallet is a physical sheet of paper with a QR code that contains a crypto address and a private key). To perform a cryptocurrency transaction, the user simply needs to scan the QR code). 

This storage method provides the highest level of security and asset protection, as the assets are not accessible from the global network. However, cold wallets imply that, firstly, executing quick transactions will be challenging, and secondly, the physical device must always be accessible in order to perform any transaction.

Hot wallets are software systems that require constant internet access and provide an interface to access the blockchain via the user’s unique access keys.

Let’s take a closer look at these wallets.

Mobile Crypto Wallets (Mobile Apps)  

These are applications for mobile devices or tablets that only work when connected to the internet and provide quick and easy access to the user’s crypto assets. These apps are popular among people who use cryptocurrency in daily life making transfers, payments, or purchases with cryptocurrency.

Examples: Trust Wallet, MetaMask, Coinbase Wallet.

Desktop Crypto Wallets (Desktop Apps)  

These are more extensive software solutions that are installed on a desktop computer or laptop. They may provide access to assets through authentication using personal keys, or they may allow users to fully download their assets onto their device. The latter provides a higher degree of security but requires more hardware resources.

Examples: Exodus, Coinomi.

Web Crypto Wallets (Web Services)  

These offer a more extended and functional interface for accessing crypto assets via a web browser, but they operate on the same principle as mobile crypto wallets providing access to the blockchain via the user’s unique access key.

Examples: Rabby Wallet, Phantom Wallet.

Regardless of how the crypto wallet is implemented programmatically, it must provide an optimal set of features to ensure that the user can use their crypto assets with maximum convenience and security:         

1. The ability to create unique access keys for crypto assets. It should include the ability to regenerate private and public keys, as well as the option to change them when necessary.

2. Session management for security. Any system, as part of its security measures, should offer a limited session time with the option to extend it.

3. Support for multiple cryptocurrencies and fiat currencies. The wallet should be able to handle various cryptocurrencies, as well as the user’s fiat currencies.

4. Conversion between all wallet currencies, including fiat. There should be the ability to convert between all supported cryptocurrencies and fiat currencies.

5. Payment, transfer, and receipt of funds. The wallet must allow for the sending and receiving of funds from other crypto asset users.

6. Integration with crypto exchanges for real-time exchange rates. The wallet should be able to integrate with one or more crypto exchanges to provide up-to-date information on conversion rates.

7. A user-friendly notification system. The application should have an intuitive notification system to alert users of important and critical events.

8. Calculating fees for different exchanges and services. A valuable feature would be the ability to calculate transaction fees when interacting with various exchanges and crypto services.

Developing a crypto wallet - whether it’s a mobile app, desktop app, or web service - requires expertise in a variety of development fields, from architecture and design to ensuring the highest levels of security in the system’s operation.

Fully functional crypto wallet offers a comprehensive range of features such as:

• Integration with multiple cryptocurrency exchanges,

• Support for various cryptocurrencies,

• Conversion capabilities,

• Analytics for individual crypto assets or the overall market,

• Fiat account integration,

• Dynamic transaction fee calculations, and more.

Development Stages of a Crypto Wallet

Planning

The development of any software product begins with analyzing the client's requirements, goals, and needs. This allows for the effective creation of a technical specification, estimating the cost and timeline of the project, and identifying potential risks that may arise during the process. In combination, this helps determine the project budget.

Business Analysis

At this stage, the architecture of the product is developed, user interaction schemas with the system interface are described, detailed functionality is defined, and the strategy for its further development is outlined. It’s crucial to consider not only technical and business requirements but also the legislative regulations for cryptocurrency usage and circulation in the regions where the system will be implemented. This ensures that potential legal issues are avoided upon release. This stage also outlines the key requirements for the final product.

System Design

This stage involves developing the design and style of the system, taking into account user scenarios. It’s essential to create a user-friendly, simple, and intuitive interface. First, the convenience, clarity, and visual appeal of the interface directly impact user satisfaction with the service. Secondly, given the rapidly growing popularity of blockchain and cryptocurrency, it’s important to remember that the majority of users are not experts in information systems. Therefore, the simplicity and ease of use of the interface, along with intuitive behavior scenarios, will be decisive factors in encouraging users to continue using the system.

Coding Stage

This stage involves creating the server-side, developing the interface, building a secure authentication system, and ensuring data protection within the system, ultimately launching the MVP (Minimum Viable Product). Developing such a project requires developers with expertise in different technologies. Therefore, it’s best to rely on well-coordinated professional teams who understand the modern IT development landscape. It's also important to note that a financial application for end users will require continuous updates and improvements to ensure its reliable performance and security. For this reason, creating comprehensive project documentation is critical, and this can only be guaranteed by an experienced development company.

Testing Stage

Testing the system involves identifying issues and weaknesses early in the development process, helping correct as many implementation errors as possible. Stress testing is also conducted to identify system vulnerabilities and weak points, and strategies for addressing them are developed. The logic and user interface clarity are tested as well.

Release and Deployment

This stage involves publishing the product on relevant platforms, going through the platform verification process to ensure compliance with their requirements, and preparing product descriptions for presentation to end users.

Technical Support and Functionality Expansion of the Crypto Wallet

After the first version of the product is released, the real work begins. This stage involves identifying bugs that were not detected during testing. Additionally, the functionality of the system is expanded and developed since it is a dynamic entity that evolves with the rapidly changing cryptocurrency technology market. Continuous efforts are made to improve the user experience while interacting with the system.

Cost and Development Timeline

The timeline for project completion, from forming the technical specification to the first release, can range from 2 to 6 months, depending on the initial functional requirements. It’s important to note that the larger and more professional the development team, the faster and more efficiently the project will be implemented.

The cost of developing a crypto wallet also depends on the complexity of its functionality and the level of user data protection required. If you want to create a wallet that merely provides access to crypto asset data, it won’t take much time or resources. However, a wallet with expanded features - such as the ability to convert currencies, access exchanges, manage fiat accounts, and process payments and transfers - presents a more complex set of tasks. Accordingly, these tasks will require more time, resources, and a higher level of professionalism from the development team. Currently, the price for developing a crypto wallet ranges from $55,000 to $300,000.

For non-custodial wallets, regardless of the final system type, development costs are generally lower because the required solutions are less dependent on server-side functionality. The wallet owner manages their private keys independently, which reduces the need for robust server-side security systems and focuses the effort primarily on creating a user-friendly and intuitive interface. While security remains crucial, the absence of third-party key handling eliminates the need to implement features for securely transmitting and protecting keys during exchanges.

For custodial wallets, beyond ensuring a seamless user interface and fast integrations with external crypto exchanges and fiat systems, significant emphasis must be placed on the development of the server-side infrastructure. This is necessary to secure key transmission, manage and restrict access rights, and protect sensitive data. This additional workload raises development costs regardless of whether the solution is mobile, web-based, or desktop.

If we consider the cost of developing a feature-rich crypto wallet, here are some approximate estimates:

• Mobile Applications: Development costs range from $70,000 to $150,000. This includes interface design, adaptation for various devices, integration with crypto exchanges, and ensuring acceptable real-time data exchange speeds.

• Web Wallets: These cost between $55,000 and $120,000, with a significant portion of the budget allocated to securing the platform from external breaches and integrating with exchanges.

• Desktop Applications: Development costs are higher, ranging from $100,000 to $200,000, due to the increased effort required to ensure greater autonomy while maintaining seamless exchange connectivity. Data transmission security is also a major focus here.

Of course, a basic crypto wallet with minimal functionality could cost only a few thousand dollars and be developed within a few weeks. However, such solutions would come with very limited features and questionable security.

For a fully functional crypto wallet that offers a comprehensive range of features, the development cost will rise significantly. Creating such a wallet can cost anywhere from $200,000 to $300,000, regardless of the chosen platform type. This price reflects the level of complexity, scalability, and security required to meet the demands of modern crypto users.

It should be noted that developing a crypto wallet with extended functionality must be done using the latest and most reliable technologies. Aside from ensuring the protection of the user’s crypto assets, speed and data transmission are crucial in this field. Crypto market rates change every second, and sometimes even faster. Millions of users are making purchases of crypto assets every second, which demands maximum protection and correct prioritization of operations. All these tasks require thoroughness and professionalism in their implementation.

Instead of a Conclusion

Crypto wallets are becoming an essential system in the modern financial world, which is increasingly integrating with blockchain technologies. The end user will always seek a balance between convenience, reliability, and security, often preferring the integrated use of different wallet types. As developers, we can offer the highest level of professionalism in creating such systems, using our experience, attention to detail, and commitment to producing excellent software products. But it’s important to remember: The final cost depends on the type of the wallet, features and how you plan to develop your service for accessing crypto assets.