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How Much Does It Cost to Build a Blockchain Project?

Blockchain Project Cost

Are you wondering how much it costs to build a blockchain project?

Since blockchain development is still something of a niche skill, we will answer that here. 

According to a study done by Markets and Markets, “The global blockchain market size is expected to grow from USD 3.0 billion in 2020 to USD 39.7 billion by 2025, at an impressive Compound Annual Growth Rate (CAGR) of 67.3% during 2020–2025.”

Besides all the money that you stand to make, innovating in blockchain is your chance to make your mark on this exciting new technology. Here’re a few amazing case studies of companies who hired DevTeam.Space to build their blockchain products:

  1. DDKOIN – Leading Cryptocurrency
  2. Medicoin – Healthcare Blockchain-Based Web Application
  3. Cryptocurrency Exchange – Exchange And Wallet Application


Blockchain is growing in popularity, however, what about the ROI?
The various kinds of blockchain projects
What are the cost elements for a public blockchain-based project?
Blockchain developer cost
What about “permissioned” blockchains?
Hyperledger Fabric: The easier option to build enterprise blockchain
Estimating the code audit effort
Conclusion: Estimation is key to determine the blockchain app development cost

Blockchain is growing in popularity, however, what about the ROI?

Given the promising use cases, the industry experts expect that the investment in blockchain will grow significantly. A Grand View Research report states that the market for this technology will likely reach $57.641 billion by 2025. The report projects a CAGR of 69.4% between 2019 and 2025.

How about the “Return on Investment” (RoI), though? Well, that’s not easy to estimate in the case of blockchain.

You see, effective implementation of blockchain very often requires that businesses share data among themselves. Take the example of blockchain-based supply chain platforms where multiple enterprises share data over one platform.

As you can see, not all the “action” is inside your business! Naturally, you don’t control everything around a blockchain platform that multiple enterprises share.

As a result, you find it hard to calculate the RoI in the case of blockchain implementation. Read more about this in “Your unanswered questions on the ROI of blockchain”.

The importance of estimating blockchain development cost

Let’s get one thing straight: Estimation is important in any project, and not just for blockchain projects! However, estimation assumes a different dimension of importance in the case of blockchain implementation.

When you have difficulties calculating the RoI, how do you get the corporate funding approval to implement blockchain? Read “Assessing the Return on Investment (ROI) of Blockchain applications” to learn more about this challenge. In a scenario like this, what would the senior leadership in your organization ask for?

Well, you will probably have quite a bit of deliberation to arrive at the RoI. However, you will surely have to come up with an estimate with a reasonable degree of confidence! That makes the estimation of your blockchain project doubly important!

The various kinds of blockchain projects

The cost of blockchain projects varies depending on what you want to achieve. Broadly, there can be two kinds of blockchain projects, as follows:

  • Building a ‘Distributed App’ (DApp) using a public blockchain network;
  • Building an enterprise blockchain for your company.

If you are building a decentralized business model where you will enable ‘Peer to peer’ (P2P) transactions using cryptocurrencies, you will most likely build a DApp. I have earlier explained a few such use cases, as follows:

You might be creating a decentralized game using collectibles. This will also require a DApp using cryptocurrencies.

On the other hand, you might be an IT leader in an enterprise. You might be planning to implement blockchain to improve efficiency, otherwise, you are likely eyeing blockchain for a ‘Business to business’ (B2B) platform. Such systems require data privacy, due to regulatory requirements.

They also require scalability, therefore, public blockchains aren’t appropriate. You might opt for enterprise blockchain for such systems. I have explained public vs private (permissioned) blockchain comparison in an earlier article, and you can refer to it.

The two approaches are entirely different. Your project outline will be different, and you will incur different kinds of costs – the cost of blockchain development being one of them.

What are the cost elements for a public blockchain-based project?

When you a build a blockchain project for a decentralized business/game, you are basically developing a DApp. Most developers use the Ethereum blockchain network. They use the ‘Ethereum Virtual Machine’ (EVM). Read more about EVM in “Ethereum virtual machine explained”. Your team needs to code smart contracts using the Solidity language.

They develop a crypto token for their DApp. Programmers also design and develop the DApp front-end. Note that you aren’t deploying a large new infrastructure here. Whether you use Ethereum, NEO, or EOS, you are using an existing blockchain network.

You might use a blockchain application platform like Lisk. Even then, you will utilize existing infrastructure. Another key aspect of this project is that the required tools like web3.js, Truffle, etc. are open-source.

You will need to buy the native cryptocurrency of the platform to deploy your DApp. For e.g., if you are developing on the Ethereum platform, you will need to buy Ether. Here again, web wallets like eth-lightwallet are free.

You will need to secure your cryptocurrencies when you aren’t using them. A hardware wallet is a good investment, and you can buy Ledger Nano S. It’s a one-time cost, furthermore, it’s not expensive.

There may be a need for you to make your DApp scalable. I have earlier explained how to scale an Ethereum DApp, and you can consult this guide. The tools you use for this, for e.g., the “Loom Network” DappChain SDKs, are also open-source. Your main cost element in this approach is the cost of developers.

Blockchain developer cost

This brings us to a key question: how much does it cost to hire a blockchain developer? Note that blockchain development skills are niche, i.e., there is a premium for these skills. Market observers reported in Q3-2017 that blockchain is the 2nd fastest growing skill. Read “Blockchain jobs and salaries 2018 report” for more details.

Take, for example, Ethereum DApp development. Developers need to know how to develop using the Ethereum platform. They need to code smart contracts using the Solidity language, there, they should learn it.

The job market can’t yet meet the demand for these skills with an adequate supply. While there are varied estimates of the demand, most observers concede that it’s high! Some have noticed a 115% increase in blockchain job posting in 2017, whereas others have seen a 207% increase.

Some industry-watchers have seen an increase of 700% in blockchain job-posting between January 2017 and January 2018! That’s truly phenomenal! Read more about these estimates in “Blockchain developer salaries – 2018 report”. The demand-supply gap has a significant impact on the blockchain developer manpower cost.

Different market analysts have cited different salary levels for blockchain developers. An average blockchain developer can earn $95k per annum in the US, as finds. Glassdoor puts the number lower, i.e., at $80k per annum.

However, the rates vary greatly between regions in the US. For e.g., blockchain developers command over U$100k salary per annum in San Francisco and New York. Read more about these findings in “How much does it cost to hire a blockchain developer in 2018? Salary overview and hiring trends”.

On the other hand, Computerworld has a different estimate. They estimate that the median income of a blockchain developer in the US is $140k per annum. They find that this goes up to $150k in New York, whereas they can earn $163k in San Francisco. Read their report in “Blockchain moves into top spot for hottest job skills”.

The annual salary increases in Switzerland. It’s $120k to  $180k per annum for blockchain developers there. In the US, freelance blockchain professionals might charge $150 or more. This rate will vary significantly in countries such as China, India, and others.

So, it won’t be an exaggeration to say that it can be expensive, not to mention complex, to hire blockchain developers. And given that your entire project depends on how skilled your developers are, it’s important to make sure that you’ve carefully conducted the interviewing process.

What about “permissioned” blockchains?

What if you aren’t building a DApp on a public blockchain like Ethereum? A blockchain solution for efficiency gain in the enterprise, or enterprises trying to build a consortium blockchain solution for trading can’t use public blockchains due to data privacy and scalability requirements. You must build a private, permissioned blockchain.

Well, you can choose to do it from scratch! You need to address all of the following:

  • Infrastructure;
  • Storage space;
  • Network speed;
  • P2P network;
  • Encryption;
  • Smart contracts;
  • Front-end.

For infrastructure, network, and storage, I suggest you engage reputed cloud “Infrastructure as a Service” (IaaS) providers. IaaS is a cloud computing model where providers address infrastructure, network, etc.

AWS is a reputed IaaS provider with very credible cloud capabilities. IBM Cloud IaaS is another credible option. There are more IaaS providers, moreover, they display their price points on their websites.

However, you now have some work at hand! You need to build a P2P network and use modern data encryption techniques. While you can get guidance in “Code your own blockchain in less than 200 lines of Go!”, you still need to hire P2P networking engineers and cryptography specialists.

You can avail some more guidance in “Code a simple P2P blockchain in Go!”, and “Part 2: Networking — Code your own blockchain in less than 200 lines of Go!”. I assume you already have front-end developers in your team, therefore, I will go on to describe the other steps.

As a next step, you need to build the consensus algorithm. There are guides for developing these in the Go (Golang) programming language. You can consult “Code your own blockchain mining algorithm in Go!” for the ‘Proof of Work’ (POW) algorithm. On the other hand, if you want to build a ‘Proof of Stake’ (PoS) algorithm, consult “Code your own Proof of Stake blockchain in Go!”.

POW and PoS both have their pros and cons. For e.g., POW provides the highest level of decentralized security, however, it’s highly energy-hungry. On the other hands, PoS consumes less energy, although it presumes that the transaction validators will do the right thing. Read our comparison guide “Proof of Work vs Proof of Stake comparison” for more information.

Depending on your use case, you might need to allow file-sharing in your blockchain. You will then need to use ‘Interplanetary File System’ (IPFS), i.e., a P2P file-sharing protocol. Read “Learn to securely share files on the blockchain with IPFS!” to learn more.

This is a complex approach. You will need to hire P2P networking specialists, encryption specialists, blockchain engineers, and Golang developers. Golang senior software engineers command up to $75k salary per annum in matured markets like the USA and Europe.

P2P networking engineers might charge a daily rate upwards of GBP 500 in matured markets. Data encryption engineers have an average salary of $96k per annum in the matured markets, moreover, you might need penetration testers, whose yearly salary can be $86k.

You will certainly need a project manager with blockchain experience, moreover, the PM should know the PM best practices. Our guide “Project management: 10 best practices” is a great place to start. Experienced blockchain PMs earn over $111k per annum.

Hyperledger Fabric: The easier option to build enterprise blockchain

I will now explain an easier option to build a blockchain project for enterprise use cases. Hyperledger Fabric is an increasingly popular enterprise blockchain platform. Hyperledger Consortium is led by The Linux Foundation, and it’s a collaboration effort.

Giants across multiple industries have joined hands in this project to develop enterprise blockchain platforms, tools, methodologies, processes, and solutions. IBM, Intel, Accenture, Cisco, SAP, American Express, Daimler, JP Morgan are just a few of the member organizations. Prestigious universities such as Yale, UCLA, and Cambridge are also members of this consortium.

While the consortium has several projects like Hyperledger Indy, Hyperledger Sawtooth, industry-watchers find that Fabric is the most advanced. I have earlier explained the pros and cons of Hyperledger Fabric for blockchain networks. Refer to it for more information.

The cost of setting up a blockchain using Hyperledger Fabric broadly includes two elements: the infrastructure, and the development cost. This approach is easier since cloud computing market leaders already provide Hyperledger Fabric infrastructure.

You can skip the infrastructure, storage, and networking aspects. Moreover, you are using a readymade blockchain platform, therefore, you don’t need to focus on file sharing, encryption, consensus algorithm, and P2P network. Hyperledger Fabric has a modular architecture, and it provides pluggable consensus algorithms.

IBM provides its’ IBM blockchain platform, which is based on Hyperledger Fabric. You can review their pricing details, which includes a starter plan and an Enterprise plan.

AWS, another cloud computing giant provides Hyperledger Fabric. They have a price calculator for Fabric on their AWS Marketplace.

SAP continues to enhance their cloud capabilities, and they are becoming an important player in the enterprise blockchain space as well. They provide Hyperledger Fabric on the SAP cloud platform, and their website contains the pricing plans.

Microsoft Azure continues to be a powerful cloud computing platform. They are making important progress on the blockchain technology as well, and they offer Hyperledger Fabric on Azure.

You now need to add the cost of Hyperledger Fabric developers. An experienced Hyperledger developer can cost you upwards of $700 per day.

Estimating the code audit effort

We have talked about the infrastructure and development-related manpower costs so far. Blockchain projects involve another cost element though, and that’s the cost for code audit.

Let’s understand its significance first. Smart contracts have a key difference with other kinds of software programs. You can’t modify them after you deploy them, and this increases your risks.

If you code smart contracts that have bugs, then the impact could be serious. You will find it very hard to recover from such a situation. The Ethereum DAO hack was an example, and you can read about it in “The DAO hack explained: Unfortunate take-off of smart contracts”.

You need to implement smart contracts that don’t have bugs. Naturally, you need to test them thoroughly. However, testing can never identify all the bugs!

You need a thorough review of your smart contracts. Only highly experienced blockchain developers can do such reviews, and they can be expensive! You need to budget for this effort.

A blockchain code audit encompasses the following:

  • Reviewing the project documentation;
  • Preliminary code review;
  • Static code analysis;
  • Identifying known vulnerabilities like reentrancy, shadowing of variables, storage pointers vulnerable to exploitation, overflows, under-flows, etc;
  • Functionality analysts;
  • Reporting and closure of defects.

Wondering how to do a blockchain code audit? The good news is that you have help at hand! We at DevTeam.Space have considerable expertise in blockchain code audit, and you can judge that by reading “Undertaking a Blockchain code audit and its importance”.

Conclusion: Estimation is key to determine the blockchain app development cost

In previous articles on this blog, I have covered cost elements like infrastructure, wallets, network engineer manpower cost, blockchain developer manpower cost, etc.

The cost of setting up a blockchain, i.e., the entire project cost requires a thorough estimation. The use case, project complexities, and the approach will all affect the price.

If you decide that you need professional help, consult our guide “How to find the best software development company?”.

Frequently Asked Questions

What is blockchain development?

Blockchain development includes using Web3, Solidity, Cakeshop, Truffle and other such tools to create blockchain applications. Examples include new cryptocurrencies or supply chain solutions.

What is the programming language for Blockchain?

• C++
• Java
• JavaScript
• Python
• Solidity
• Simplicity
• CX

What skills are required for Blockchain development?

Your developer will be required to have a good understanding of the ins and outs of blockchain technology. They will also need to know programming languages such as Solidity and Simplicity. They will need to know how to deploy and manage applications on a blockchain.


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Companies like Samsung, Airbus, NEC, and startups rely on us to build great online products. We can help you too, by enabling you to hire and effortlessly manage expert developers.

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