Regenerative Finance: Technology Overview And Future Application

From CeFi to DeFi and reinvented ReFi, Web3 has reshaped traditional finance-related activities such as capital investment, profit distribution, and fund transfer. In the field of blockchain, regenerative finance (ReFi) is gradually getting attention on behalf of the blockchain application in the carbon trading market, opening a whole new chapter.

ReFi is not something new, as we at IdeaSoft have already worked with it. We predict a new boom for ReFi projects in 2024. This article will discuss what is ReFi, why ReFi aims for sustainability, and what is the future of regenerative finance.

Does your company actively seeks to contribute positively to the environment and communities while conducting its financial operations?

ReFi promotes the practice of low-carbon actions through blockchain technology and financial reward mechanisms. Through the transparent and resistant characteristics of the blockchain, it regularly rewards those who contribute to green development. Build your own finanial app based on ReFi concept! Contact us and we will help you with the correct requirements for your solution.

Table of Contents:

Introduction to ReFi: What Is Regenerative Finance?
Conceptual Framework of Regenerative Finance (ReFi)
Technological Underpinnings of Regenerative Finance (ReFi)
How is ReFi Different From DeFi?
ReFi Case Study: Toucan Protocol
Future Applications of Regenerative Finance (ReFi)
Summary

Introduction to ReFi: What Is Regenerative Finance?

Regenerative Finance (ReFi) is a movement based on blockchain technology to encourage people to practice low-carbon and curb or reverse climate change through innovation in financial incentives. Currently, startups, non-profit organizations, investors, venture capital firms, and others have already developed some key infrastructure and applications in Web3. They inject new vitality into sustainable development while actively promoting the construction of a healthier and fairer environmental Web3.

Based on top blockchain development platforms, ReFi combines economic incentives with the current hot topic of sustainable development to bring all industries together to achieve this goal. Blockchain’s distributed network and incentives give it a natural advantage in creating mechanisms, such as smart contracts and NFTs, that can drive the economy toward sustainable development.

Conceptual Framework of Regenerative Finance (ReFi)

This conceptual framework helps to create a more sustainable and just social future in Web3:

Climate stabilization. ReFi helps stabilize the climate by supporting clean energy and low-carbon lifestyles. It reduces carbon emissions and climate disasters such as forest fires by creating carbon markets to track and allocate resources. This helps reduce the management cost for countries and reduces the impact of climate extremes.
Establishing social justice. ReFi aims to achieve sustainable development, maintain a balance between people and the environment, and bring about positive cycles. This can be achieved by planting trees to improve the environment, contributing to remote areas, making financial services accessible to lagging countries, etc.
Increasing financial inclusion. ReFi provides greater financial opportunities and choices to groups that currently do not have access to traditional financial services. This increases financial inclusion, enabling more people to access the financial support necessary to grow their businesses and families.
Reducing financial risk. ReFi creates more transparent and stable financial markets by utilizing new technologies such as blockchain. This helps to reduce financial risk and make the financial system more robust, thereby protecting investors and financial institutions from unnecessary losses.

So, regenerative finance principles bring much value and impact to society, including stabilizing the climate, establishing social justice, increasing financial inclusion, and reducing financial risk.

Technological Underpinnings of Regenerative Finance (ReFi)

Taking control of the carbon footprint is an important part of sustainability. For ReFi companies, it is not enough to achieve carbon neutrality. They aim to positively impact the climate, i.e., energy savings, emission reductions, and negative carbon emissions by removing greenhouse gases.

In Web3, energy savings and emission reductions can be achieved by choosing energy-efficient alternatives or increasing the percentage of clean energy applications. For example, Ethereum switched from a PoW mechanism to a PoS mechanism, thereby reducing energy consumption by 99.95%.

On the other hand, blockchain can track environmental impacts, improve carbon footprint transparency, and enforce accountability for carbon emissions. “Blockchain+Financial Resources” is not only a technological tool but also a resource to help regenerate the planet.

The innovation of regenerative finance is that financial institutions benefit from renewable energy projects not only on a physical and financial level but also on a social level. Thus, ReFi encompasses multiple dimensions, such as the assetization of renewable energy, the development of accounting measurement standards, and the digitization of carbon assets.

Here are some examples of how blockchain is empowering ReFi to create a sustainable future:

Gamification. ReFi promotes rewarding participants with work credits, tokens, points, and so on for taking real action to eliminate CO2 emissions.
Accountability. Blockchain can be used to credibly trace carbon emissions and hold governments, businesses, and NGOs accountable for climate goals.
Asset digitization. It is possible to use digital twins to transform carbon assets into credible and traceable digital assets, increasing asset liquidity.
DAO & Community. ReFi leverages the DAO or Web3 community to promote sustainable policy implementation and green business.

In addition to the above applications, blockchain can enable some things traditional tools cannot do. For example, the contribution of traditional joint ventures is measured chiefly only by the percentage of equity investment, which does not reflect the true picture of the operation of the partnership.

The contribution of a joint venture should include the business opportunities that each partner has brought to the joint venture once the business has started operating, as well as the value that has been driven in the alliance.

In a ReFi crypto eco-alliance built on blockchain, with a good incentive design and governance structure, it is possible to measure the contribution of these more meaningful metrics to create a more productive form of cooperation or alliance model.

Regenerative finance functions more as a framework for engaging in social activities. From my perspective, this is unlikely to reshape the market but presents an opportunity for enthusiasts to leverage this functionality. While it introduces a novel approach to incentivizing social participation, its transformative impact on the broader financial landscape remains to be determined. The concept’s significance may lie in affording enthusiasts a platform to harness its functionalities rather than fundamentally altering market dynamics.
Herman Stohniiev, CTO at IdeaSoft

How is ReFi Different From DeFi?

DeFi platform development is often confused with ReFi platform development. Here is a brief comparison of ReFi vs DeFi.

ReFi vs DeFi, Regenerative finance in crypto

As the threat of climate change intensifies year by year, it is even more vital for enterprises to shoulder their social responsibility. More and more financial institutions are facing pressure not only in terms of investment but also in terms of the social and environmental impact of their investment policies.

An alliance that brings together the resources of communities, investors, and financial institutions can not only make more all-encompassing investments worldwide but also form a large infrastructure portfolio that enables comprehensive investments and quick processing methods.

ReFi Case Study: Toucan Protocol

The example of the Toucan Protocol provides a better understanding of how carbon rights are tokenized and solves the price discovery problem. However, the Toucan Protocol still has issues that need to be addressed.

For example, whether carbon credits are actually beneficial to the climate and whether on-chain trading meets real-world international market standards. Both the on-chain and off-chain worlds have their issues to face.

The Toucan Protocol, which converts Verified Carbon Units (VCUs) into a cryptocurrency and a regenerative economy based on the DeFi model, consists of 3 main elements.

Element 1: Toucan Carbon Bridge

The Toucan Carbon Bridge enables users to store carbon credits as NFTs on the blockchain. Advantages include complete transparency and divisibility, and the destruction of carbon tokens on the chain is equivalent to the cancellation of carbon credits, which prevents double-counting. The NFT can be split into fungible toucan carbon tokens to facilitate transactions.

Element 2: Toucan Carbon Token (TCO2)

Since Toucan Carbon Token still retains the original properties of NFT (origin registration, yearly score, etc.), it causes the problem of illiquidity. It is also a major pain point in the real-world carbon rights market, hence the emergence of Toucan Carbon Pool.

Element 3: Toucan Carbon Pool

It is needed for product differentiation per project. The Toucan Carbon Pool solves the problem of price liquidity in the carbon market by taking carbon tokens (TCO2 tokens) from multiple projects and pooling them into a more liquid carbon index token. It can be traded on a decentralized exchange.

Need more tech details?

Contact our team to get more information about the ReFi concept and how it can help your project to contribute.

Future Applications of Regenerative Finance (ReFi)

ReFi could encourage the development of innovative financing models, such as green bonds and impact investing, specifically tailored for sustainable infrastructure. These financial instruments can attract capital from investors seeking both financial returns and positive environmental impact.

By aligning financial incentives with sustainability goals, ReFi has the potential to accelerate the transition to a more sustainable and resilient Web3 infrastructure globally. Leveraging outstaffing for Web3 development can empower organizations to build cutting-edge ReFi solutions by accessing skilled developers specialized in blockchain and sustainability-focused projects.

Regenerative finance in crypto can empower local communities through decentralized financial solutions. This involves shifting financial decision-making and resources closer to the communities that are directly affected by them. Local community banks, credit unions, and microfinance institutions adhering to regenerative finance principles may emerge as key players in providing financial services to underserved populations.

Regenerative finance can also be crucial in funding conservation and restoration efforts and supporting initiatives to protect biodiversity and ecosystem services. Financial institutions incorporating regenerative principles may allocate resources to projects focused on reforestation, habitat preservation, and sustainable land use practices.

So, regenerative finance seamlessly fuses the principles of regenerative economics with the innovation of decentralized finance. This visionary financial ecosystem represents a paradigm shift, aspiring to make financial services and products accessible to all.

The ReFi-driven movement has initiated robust communication channels within its community, and the momentum is surging, propelled by the transformative capabilities of Web3 technology.

Notably, the focus is steadfastly placed on catalyzing sustainable development across diverse sectors through ReFi projects embedded in the Web3 landscape. Brace yourself for the impending takeoff of these groundbreaking initiatives in 2024 as they redefine the future of finance.

Summary

As ReFi heats up in 2023, there is an influx of ReFi projects that aim to engage companies and users in solving many of the world’s problems while using cryptocurrency to label their contributions and economic returns.

At IdeaSoft, we believe that 2024 will be the year that ReFi gains more mainstream attention and adoption, proving that cryptocurrencies can directly impact the real world. ReFi will help shift the crypto narrative from the “scam” to one promoting a more sustainable, low-carbon economy.

Decentralized Physical Infrastructure (DePIN) Explained

A new era in crypto and DeFi is rapidly evolving. When the growing influence of blockchain technology is combined with the rapid development of globalized information technology, a whole new playing field is unveiled. This is DePIN (Decentralized Physical Infrastructure Network). The concept of DePin is now a hot topic among crypto enthusiasts, promising a revolution in decentralized physical infrastructure.

At IdeaSoft, we noticed this trend at the Breakpoint conference by Solana Foundation. There were active conversations about using this technology and how to create a blockchain application to succeed in 2024. We expect a wider adoption of the DePIN concept in the coming years, and that is why we aim to shed light on DePIN applications and the benefits of DePIN.

Table of Contents:

Conceptual Understanding of DePIN
Physical Resource Networks vs. Digital Resource Networks
How DePINs Transform Web3?
Examples of DePIN Projects
Future DePIN Applications
Summary

How can DePIN benefit your startup?

The main benefits of using DePIN in startups are rapid scale, neutrality with credibility, collective ownership, and frictionless payments.

Want to build a scalable technology based on the emerging DePIN concept? Our experienced team can help you with it and draw up the correct requirements for your product. Contact us to schedule a free consultation!

Conceptual Understanding of DePIN

DePINs, or Decentralized Physical Infrastructure Networks, are networks that use token incentives to motivate individuals to share their resources. This sharing of resources covers a wide range of areas, including storage, communications traffic, cloud computing, energy, etc. DePINs have transformed infrastructure provision by centralized enterprises into a form of crowdsourcing that involves users worldwide.

Why do we need DePIN? The answer to this question relates to the limitations of the current ICT (Information and Communications Technology) infrastructure. DePIN provides decentralized infrastructure and the possibility to address different limitations.

The term DePIN was first promoted and emphasized in the report of the investment research institute Messari, which also set up DePIN-related statistics.

Ethereum is known as the main chain for DePIN projects, but Solana is also starting to take the position here. The market is currently dominated by leaders such as Filecoin, Render Network, Theta Network, Arweave, and Akash Network. Developers often explore Ethereum and Binance for DEX to leverage their advanced functionalities and ecosystem support for DePIN initiatives.

How does DePIN work?

Let’s explore how DePIN works. DePIN uses a token economy model to incentivize users to provide resources, including GPU power, hotspots, storage space, etc. In the early days of DePIN, tokens often had no real value, so users engaged in a behavior similar to that of venture capitalists. They invested in bullish DePIN projects, becoming “risk miners” and reaping the benefits of increased token acquisition and token price appreciation.

what is DePIN — *The DePIN concept work model*

Modern DePIN projects have the following goals:

Attracting supply-side participants through tokens. Adopting a well-established token economy model attracts early participants to contribute to the network construction and provide resources. They are rewarded with tokens in return.
Attract consumers. As resource providers grow, some developers join the ecosystem to create products. Consumers are also attracted to DePIN once the provider can offer certain services at a lower price compared to centralized infrastructures.
Positive feedback. As the number of users increases, this demand motivates supply-side participants with higher revenues, creating a positive feedback loop. It attracts more participation from both supply and demand.

Early projects in the DePIN space focused on storage and communication technologies, such as decentralized network Helium (2013), decentralized storage Storj (2014), and Sia (2015). With the development of the Internet, Internet of Things (IoT), and Artificial Intelligence (AI), the focus of DePIN innovations has expanded to include computing, storage, communication technologies, and data collection and sharing.

Physical Resource Networks vs. Digital Resource Networks

What is a decentralized network? We have prepared a comparison table to help you understand the difference between physical resource networks vs. digital resource networks.

	Physical Resource Networks	Digital Resource Networks
Accessibility	Limited by geographical constraints; physical presence is often required for maintenance and operation.	Accessible globally, allowing remote management and utilization of resources.
Scalability	Expanding physical networks often involves significant time and cost investment in acquiring new assets and infrastructure.	Easily scalable by adding or adjusting virtual resources, offering greater flexibility and cost-effectiveness.
Maintenance	Regular maintenance and repair are necessary for physical components, with potential downtime during maintenance activities.	Maintenance involves software updates and digital security measures, with minimal impact on ongoing operations.
Resource Duplication	Physical assets must be replicated for redundancy, leading to higher costs and resource consumption.	Digital resources can be duplicated or backed up more efficiently, reducing costs and improving resilience.
Cost	Initial setup costs are typically higher due to the purchase of physical assets and infrastructure.	Initial setup costs are generally lower, but ongoing operational costs may include software licenses and cloud services.
Flexibility	Limited flexibility in reconfiguring physical networks, often requiring significant time and investment.	Highly flexible, allowing quick adjustments to resource allocation, configuration, and adaptation to changing requirements.
Security	Physical security measures are crucial to protect assets, and breaches can have significant consequences.	Digital security measures, such as encryption and cybersecurity protocols, are essential to safeguard data and systems.
Lifespan	Physical assets have a finite lifespan and may become obsolete over time, requiring regular upgrades.	Digital resources can have a longer lifespan, with the potential for updates and upgrades to extend functionality.

The comparison table provides a general overview, and specific cases may vary based on the industry, context, and technology advancements. If you want to develop your own innovative Web3 application, we have many articles in our blog on how to create a Web 3.0 app, or you can contact us, and we will consult you regarding your ideas.

How DePINs Transform Web3

DePIN Web3 emerges as a solution to address critical challenges within the Web3 ecosystem, particularly the bottleneck associated with centralized infrastructure. This decentralized model can reduce the strain on any single point of failure, fostering a more robust and adaptable infrastructure for decentralized applications (dApps).

DePINs play a pivotal role in facilitating the creation of applications that require physical infrastructure support. These applications often demand significant computing power, storage, and bandwidth. DePINs provide a decentralized network of resources that developers can tap into, offering improved resource availability.

Furthermore, the global accessibility of Web3 stands to benefit from DePINs. In regions with limited access to traditional centralized infrastructure, these decentralized systems allow the widespread adoption of innovative technologies. DePINs contribute to a more globally accessible Web3, empowering users worldwide to engage with and leverage decentralized technologies.

Examples of DePIN Projects

Here are 4 prime examples of DePIN crypto projects.

Filecoin & Arweave – The Leaders in Decentralized Storage

Filecoin and Arweave are redefining how data is stored. Filecoin drives distributed storage through token incentives based on the IPFS protocol, and Arweave provides a permanent storage solution. These innovations reduce the cost of storage and improve data security and reliability.

Helium – Leading the Way in Decentralized Wireless Networking

Helium is a pioneer in decentralized wireless networks, engaging users to build the Internet of Things (IoT) through token incentives. With significant progress in the IoT space and challenges in the 5G and WiFi markets, Helium’s success lies in its effective use of decentralized technology to solve the problem of high IoT infrastructure costs.

Render Network – The Rising Star of Decentralized Computing

The Render Network, a decentralized GPU rendering platform, provides a new image and animation rendering solution. The network effectively matches GPU supply and demand through a multi-tiered pricing strategy while facilitating the reuse of idle GPU resources, providing customers with a more affordable rendering option.

Theta Network – The Innovator of Decentralized Streaming Media

Theta Network leverages decentralized technology to optimize content delivery, lowering the cost and increasing the efficiency of image delivery. Theta Network features users contributing bandwidth and computing power as part of the video delivery, providing users with a better video viewing experience.

Future DePIN Applications

The development of the DePIN domain has revealed many advantages, such as increasing resource efficiency, reducing costs, and increasing market transparency. At the same time, it also faces technical, market, and regulatory challenges. These challenges include improving the user experience, maintaining competitive advantage, and complying with regulatory compliance.

The future of the DePIN space is full of opportunities and challenges. With technological advances and increased market awareness, these innovations are expected to address current challenges and revolutionize data storage, computing, and image delivery. Looking ahead, DePIN has the potential to become a key infrastructure to support the digital economy, bringing real value to society, businesses, and individuals.

DePIN use cases are diverse, from WiFi to data storage and transportation. A great example is the global map of the Helium (IoT) network, which is updated every 30 minutes. It shows extensive use.

With DePIN, people can use WiFi, transportation services, storage, IoT infrastructure, data, maps, and so on while earning rewards. This is not just about trend growth but also about driving mass crypto adoption. This trend promises a major transformation in how we interact with technology and infrastructure daily.

DePIN is an exciting model for incentivizing the real sector through blockchain technology. The network supports physical infrastructure development through a profit and rewards distribution model. Physical infrastructure can include Wi-Fi stations, surveillance cameras, servers, etc.
Several projects are working on these initiatives, starting from Helium and ending with well-known projects like Filecoin and IPFS. However, the market is still in its early stages, as mass adoption is expected to occur when major players in physical ecosystems, such as Nokia, Ericsson, or Huawei, take an interest in this direction.
Anna Datsenko, COO at IdeaSoft

Summary

Now, you know what is DePIN. It is not just a trend in the crypto world but a step forward in integrating blockchain into our daily lives. With its potential yet to be fully tapped, the future of DePIN looks bright, opening up new opportunities in the crypto world.

DePIN is not something new in the crypto market. At IdeaSoft, we possess vast experience working with such projects and are glad that trends are returning. If you want to implement the DePIN technology, we are ready to help you with this venture!

Private Shards in a Public Blockchain Explained

Discussions on scaling cryptocurrencies are ongoing, and several potential solutions to this issue have been in development for some time. The concept of private shards has gotten wider appliance in the last year. Now, it allows us to realize many technological solutions that previously were not available.

At IdeaSoft, we worked extensively in the blockchain domain. Our case studies demonstrate our vast expertise in a variety of industries. This is why we aim to shed light on private shards in public blockchain. This is a fairly new, young technology, but very promising. It will help a lot if you apply it correctly. This article will discuss the pros and cons of sharding blockchain as well as sharding in blockchain examples.

Should you use sharding technology for your solution?

Sharding is an excellent solution for solving scalability issues arising from growing transactions. The sharding approach enhances resource efficiency, enables customization for specific use cases, and is particularly advantageous in networks experiencing rapid expansion. Reach out to our team of blockchain experts and we will help you to define the best solution for your project!

Table of Contents:

Understanding Sharding in Blockchain
Sharding Work Principle
What problems can be solved with sharding?
Private Shards: Concept and Purpose
Technical Implementation of Private Shards
Real-World Examples
Summary

Understanding Sharding in Blockchain

The definition of sharding blockchain is complex. Sharding is a method that allows you to separate and provide storage for a specific set of information. With the help of sharding technology, it is possible to create a database where nodes will be placed. They are formed into individual servers. According to blockchain sharding technology, separate networks are divided into separate individual clusters.

A node is assigned for each cluster. It simplifies the set of operations and transactions. Through the servers, users make financial transfers. With large loads, failures can occur, so optimal solutions are required to solve such a problem.

If you distribute the blockchain in separate segments, the system will be able to work much faster. You can get rid of excessive workloads and likely failures. The speed of transactions will increase several times. Blockchain sharding technology has proven itself in practice. It is already used in:

Ethereum
Zilliqa
Polygon
Avalanche
NEAR

So, if you have your own blockchain project and want to move it to the next level, a great idea is to consider blockchain sharding technology.

Sharding Work Principle

You can understand the principle of sharding in the example of Ethereum. This blockchain includes a huge number of nodes or individual computers. They all use a certain percentage of the total hash rate responsible for the blockchain`s functionality. DApps are also managed using a hash rate.

Ethereum was based on the concept of sequential execution. All nodes had to be responsible for individual transactions and process them. Transactions went through a verification process that took much time. Statistics showed that Ethereum conducted at least 20 transactions every second. But if compared with other systems, such as Visa, the throughput here is at least 20,000 transactions for a similar time.

If developers added computers to the network, this solution would not increase the whole system’s efficiency. The register is stored on separate devices. Computers would only increase the verification sequence.

Instead of adding new computers to the network, the Ethereum team has implemented sharding technology. This way, they improved the process of each individual transaction. Ethereum is now divided into shards with many registries. Nodes only manage certain registry classes to which they are attached. Their task includes the execution of all processes and transaction confirmation. Sharding makes Ethereum and Binance for DEX more scalable and efficient, meeting the growing demands of decentralized exchanges.

What problems can be solved with sharding?

If there is a scaling problem, the sharding concept can be utilized to implement the blockchain of the future. When blockchain is gaining popularity and demand among users, they use all available tools and perform various financial transactions. As a result of this, the load level increases. The network is also loaded due to running applications, if any.

At the maximum load, the speed of financial transactions decreases. The blockchain cannot be extended, and future changes and improved capabilities cannot be implemented. When transaction activity increases, nodes will need to be improved so that they can verify more transactions. Sharding can solve the scaling problem, so it is worth considering this option.

Private Shards: Concept and Purpose

Private shards are defined by their unique set of characteristics that distinguish them in the blockchain ecosystem:

Selective visibility. Private shards allow for selective visibility, ensuring only authorized participants can access and view specific transaction data. This enables a level of confidentiality vital for sensitive business operations.
Permissioned access. Access to private shards is permissioned, meaning only designated entities possess the keys to unlock and participate in the transactions within that shard. This controlled access ensures a secure and trusted environment.
Scalability and performance. Private shards contribute to the overall scalability of a blockchain network by distributing the load across multiple shards. This results in enhanced performance, reducing congestion and transaction times compared to traditional public blockchains.
Smart contract functionality. Private shards integrate smart contract functionality. This allows for the execution of complex, automated business processes within the private and secure confines of the shard.

The advantages of private shards in blockchain become particularly evident when examining their use cases:

Enterprise blockchain solutions. private shards are tailor-made for enterprise-level blockchain applications, where data privacy and confidentiality are paramount. Industries such as finance, healthcare, and supply chain management can benefit significantly from private shards’ secure and scalable nature.
Sensitive data transactions. When dealing with transactions involving sensitive data, such as personally identifiable information (PII) or proprietary business processes, private shards offer a secure enclave for these exchanges. This is critical for compliance with data protection regulations.
Consortium blockchains. In consortium blockchains where a limited number of trusted parties are involved, private shards provide an ideal solution. They maintain transparency among consortium members while safeguarding sensitive information from unauthorized access.

Private shards also serve as a robust solution to the limitations inherent in public blockchains like privacy concerns, scalability bottlenecks, and regulatory compliance.

Technical Implementation of Private Shards

Let’s revise the concept of private shards on the solution from our long-lasting partner, NEAR blockchain. Private shards within the NEAR network introduce seamless interoperability where public chain contracts can engage with private shard contracts and vice versa.

This interaction is facilitated through the existing mechanism managing cross-shard routing, offering a transparent experience for both users and developers without necessitating additional efforts. Remarkably, public contracts can interact with private ones without explicit knowledge of the underlying private nature.

definition of sharding blockchain — The example of blockchain sharding technology

Consider the scenario where two private shards seek to interact directly, bypassing public shards. The solution lies in the establishment of a shared identity space. Each private shard is endowed with a unique name akin to web domains. For instance, the University of Berkeley and Tencent might possess accounts named “berkeley.edu” and “tencent.com,” respectively.

Within their private shards, specific applications are allocated sub-accounts. Using the example of a real estate ownership tracking application, these could be “properties.berkeley.edu” and “properties.tencent.edu.” In the case of a property transaction between these entities, a cross-private shard transaction occurs. It is followed by public chain settlement if the information needs validation by the public.

Want to build your solution based on the private shards concept?

Let us help you figure everything out, and correctly draw up the requirements for your project

Real-World Examples

Today, many platforms implement sharding blockchain to reduce server load. As a result, they were able to increase the interest of users.

A striking example is the Zilliqa platform. Specialists at the testing stage were able to achieve an excellent result. They increased the number of transactions to 2800 per second.

As we described above, the NEAR blockchain also applies sharding technology. Developers can create and use various applications with the help of the offered tools. Meanwhile, nodes can freely function on devices that do not have a high level of performance.

One of the greatest applications for private sharding technology is the ability to implement a digital ID system based on blockchain that will be secure and transparent from one perspective yet accessible by a certain amount of people interested in a particular location from the other. Polygon and Avalanche Subnet are pioneers in this direction, providing unique privileges for realizing digital identity.

Moreover, the application of digital ID developed on blockchain reveals a rich set of benefits and opportunities. It is not only a new stage in the evolution of private corporations but also of healthcare services. It creates prospects for a more secure, efficient, and sustainable digital environment. These technologies can be successfully deployed in various fields, such as large corporations, medicine, and many others.

For example, large corporations need a digitized identity on blockchain due to its tamper-resistant records and advanced encryption. This way, large corporations can reduce the risk of identity theft and fraud. Blockchain’s efficiency in identity verification can significantly cut costs and enhance user control. This is due to streamlined processes and automated consent management via smart contracts. The decentralized nature also adds resilience by eliminating single points of failure, fostering trust among participants, and offering corporations scalable solutions through Blockchain as a Service (BaaS) providers.
Read also: Use Cases of Shared & Based Sequencing

By the way, there’s a trend toward private solutions for the next year. Fortune Business Insights says the private blockchain sector is poised to command a substantial revenue share throughout the coming years.

Private solutions and services empower organizations to adopt regulations with reduced transaction costs, facilitating transaction reversals. The heightened scalability of private digital ledger solutions is anticipated to drive demand significantly.

Adaptation of private solutions helps speed up transactions and lower costs while making solutions scalable. We expect a great growth in demand for private blockchain technology specialists. Besides, consortium and hybrid models expect great adoption for the federal layer solutions.
Fortune Business Insights Complex Market Research 2024

Summary

Today, the whole blockchain industry is trying to forge a connection between the internet and blockchains that are poised to drive the future. A pivotal initiative contributing to this mission is private shards. Private shards serve as a foundational element, contributing to establishing an ecosystem wherein businesses, users, and partners can seamlessly interact. By offering advanced blockchain development solutions, we help businesses unlock new opportunities and create secure, scalable ecosystems tailored to their needs.

We at IdeaSoft contribute to the evolution of a digital landscape by addressing current challenges and paving the way for the transformative potential of blockchain technologies. If you want to build private shards or develop blockchain applications, feel free to contact us!

DeFi with CeFi Experience: What to Expect in the Nearest Future

Are DeFi and CeFi the future of finance? Undoubtedly. DeFi and CeFi coexist as an answer to the traditional financial system. These are 2 various approaches to processing crypto transactions with their own benefits and limitations. And both are in great demand among people.

According to Statista, DeFi users are expected to be 9.33m by 2027. It’s actively discussed how to create a unified platform that will unite the benefits and solve the limitations of each approach.

At IdeaSoft, we worked extensively in the DeFi and CeFi domains. Our case studies demonstrate our vast expertise in a variety of industries. This is why we aim to shed light on DeFi and CeFi in crypto. This article will discuss the difference between DeFi and CeFi as well as how to create a hybrid DeFi with CeFi platform.

Table of Content:

What is DeFi?
What is CeFi?
DeFi and CeFi Benefits and Limitations Comparison Table
Creating a Hybrid DeFi with CeFi Platform
The Future of DeFi and CeFi
Summary

Want to build DeFi with CeFi platform?

Contact us at IdeaSoft right away! Combining DeFi’s permissionless protocols with CeFi’s regulated environment requires a multifaceted approach to risk management. Together, we will build a solid and secure platform with user-centric and efficient crypto experience.

What is DeFi?

DeFi (Decentralized Finance) is the answer to the traditional financial system, the control of which is in the hands of top managers and regulators.

DeFi principles imply a decentralized approach to providing financial services through blockchain and a fully automated approach through smart contracts. It is about rejecting single control centers and intermediaries in favor of distributing responsibilities among market participants. For example, instead of banks in DeFi, loans are issued by users who want to make money. This is how Compound works.

Advantages of DeFi

Refusal from centralized management opens access to fair financial service prices. In the DeFi market, the price is formed by the market participants themselves, who are forced to follow the demand. Classic banks, in turn, depend on the Central Bank and can set prices that are only in their interests, as they are monopolists.

Other primary advantages of DeFi include:

Accessibility. A user does not need to leave the house to get a financial service on the DeFi market. It is enough to have at hand a gadget with access to the network.
Anonymity. It is possible to work confidentially on the DeFi market.

Since DeFi offers comprehensive advantages over the traditional financial system, it is profitable to create a DeFi project in 2024 when there is still not so much competition.

Limitation of DeFi

The main disadvantage of DeFi is the insufficiently high level of security. News about protocol hacks in the DeFi market is a frequent phenomenon. Also, DeFi platforms are usually inferior to their centralized competitors in terms of ease of use, speed of operation, and functionality.

What is CeFi?

CeFi (Centralized Finance) refers to centrally managed platforms that provide access to the market of digital assets. An example of such a project is the largest crypto exchange Binance. Control over the trading platform is in the hands of its owners. At the same time, Binance opens access to tools for conducting transactions with cryptocurrencies, which have become a decentralized answer to traditional money.

Advantages of CeFi

CeFi projects are usually superior to decentralized counterparts in terms of speed. Also, centralized platforms are more functional and convenient. They offer regulatory compliance, integration with fiat currencies, higher liquidity, and stability.

CeFi emphasizes storing all data in one place. For example, in case of password loss or if you forget your password, everything can be restored. With decentralized finances, it is unlikely to happen. However, some DeFi projects are already working on solutions to combine them.

Although there are DeFi-analogs of many CeFi projects, CeFi is superior. A vivid example is the situation in the crypto exchange market. There are many decentralized exchanges (DEXs) available to users. Despite this, crypto community participants continue to prefer centralized crypto exchanges. Working with a crypto exchange development company can help businesses build secure and scalable CeFi or DeFi platforms that cater to the growing demand in the cryptocurrency market.

Limitation of CeFi

The main disadvantage of CeFi projects is their centralized nature. Control over the platform and its users’ money is in the hands of managers who can act as they see fit. Also, this approach often implies the de-anonymization of users.

DeFi and CeFi Benefits and Limitations Comparison Table

CeFi and DeFi are often confused. We have created 2 comparison tables of CeFi vs. DeFi to help you better understand these terms. First, let’s compare their benefits.

	Decentralized Finance (DeFi)	Centralized Finance (CeFi)
Financial Inclusion	Facilitates financial services for the unbanked and underbanked.	Offers limited access for the unbanked and underbanked.
Transparency and Trustlessness	Leverages blockchain for transparency and trust.	Relies on regulatory oversight for transparency.
Decentralization	Eliminates intermediaries, mitigating the risk of censorship.	Allows for swift and efficient transaction processing.
Speed and Efficiency	Ensures rapid transaction processing and ample liquidity.	Maintains prompt and efficient transaction processing.
User-Friendly Experience	Can be intricate for non-technical users.	Presents user-friendly interfaces with dedicated support.
Asset Custody	Empowers users with direct control over their assets.	Ensures the security and safety of user assets.

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Now, you understand all the benefits of CeFi and DeFi. Next, let’s move to their limitations.

	Decentralized Finance (DeFi)	Centralized Finance (CeFi)
Scalability Issues	Faces network congestion and high transaction fees.	Encounters scalability constraints during peak usage.
Security Concerns	Prone to smart contract vulnerabilities and hacking incidents.	Depends on centralized security measures for protection.
Lack of Regulation	May lack legal clarity and investor protection.	Subject to regulatory oversight and potential compliance issues.
Lack of Decentralization	Might lack genuine decentralization, platform-dependent.	Operates with centralized control and susceptibility to manipulation.
Counter party Risk	Minimizes reliance on intermediaries, but counterparty risk persists.	Reduces counterparty risk through centralized control.
Limited Transparency	Offers open source code but may have restricted insight into platform operations.	Furnishes more information about its operations.

We hope these 2 comparison tables have helped you to better navigate these terms. Next, we will provide you with some recommendations on how to combine DeFi and CeFi and leverage the advantages of DeFi with CeFi platform.

Creating a Hybrid DeFi with CeFi Platform

Well, what is the reason for integrating CeFi approaches into decentralized platforms?

Centralized finance platforms often offer content and onboarding that helps beginners feel more comfortable exploring crypto.
UniswapLabs

The flawless onboarding and ongoing support have played the major role in customer acquisition for a long time. Therefore, the application of a few well-known communication strategies and technology hybrids has a great potential to create a new level of DeFi and boost blockchain adoption we all team about.

There are a few successful DeFi platforms implementing CeFi models, featuring dYdX example as one of the most known and successfully implemented. At IdeaSoft, we were involved in creating another finest DeFi product with CeFi features – Orderly.Network. Tips below are complied based on our broad experience.

Embracing the Best of Both Worlds

A delicate balance must be struck between decentralized and centralized elements to craft a successful hybrid DeFi with a CeFi platform. Leveraging blockchain technology ensures transparency and trust by recording transactions on a tamper-proof ledger. At the same time, incorporating centralized elements enables the platform to offer fast, efficient, and user-friendly services.

Blockchain’s immutable and transparent nature is a cornerstone of decentralized systems. Integrating blockchain technology into the hybrid platform ensures that all transactions are recorded securely, fostering user trust.

A success of any financial platform lies in its ability to provide users with fast, efficient, and user-friendly services. Your hybrid DeFi with a CeFi platform should focus on streamlining processes, reducing transaction times, and maintaining a seamless user experience.

Overcoming the Challenges

Establishing a successful hybrid DeFi with a CeFi platform takes time and effort. Addressing these issues head-on is essential for the platform’s long-term viability.

Scalability remains a significant concern for decentralized platforms. The hybrid DeFi with a CeFi platform should explore and implement layer-2 solutions to counteract this. Moving some transactions off the main blockchain can significantly improve scalability.

Security is another paramount concern in the world of finance. Your platform must prioritize implementing rigorous security measures, including:

Encryption
Multi-factor authentication
Secure smart contract development

In DeFi, prioritizing security is a must. Without top security measures, your DeFi with a CeFi platform is obliged to fail.

User Education and Risk Management

Educating users about the unique features and risks associated with the hybrid platform is key to fostering a secure and informed user base.

Users need to be knowledgeable about the distinctive features of your platform. Providing clear and accessible educational materials ensures that users can make confident decisions.

At the same time, risk management is a fundamental aspect of any financial platform. The hybrid nature of the platform requires robust risk management strategies to protect user assets. This includes:

Mechanisms for handling potential smart contract vulnerabilities
Insurance alternatives
Emergency plans for unforeseen events

Considering these tips, you can create a successful hybrid DeFi with CeFi platform.

The Future of DeFi and CeFi

Interoperability becomes a cornerstone for progress. Blockchains and financial ecosystems are poised to prioritize seamless interoperability, fostering fluid asset movement between DeFi and CeFi platforms. This interconnected approach enhances efficiency and signifies a commitment to providing users with a more cohesive and integrated financial experience.

Security, a paramount concern in the decentralized space, is expected to reach new heights. Both DeFi and CeFi platforms will fortify their security measures, conducting rigorous audits and implementing insurance protocols to ensure the robust protection of user funds. This commitment to security is essential for building and maintaining trust as the financial landscape evolves.

After the FTX collapse and all the volatility within CeFi products, users psychologically returned to what crypto was created for – non-custodial products and DeFi. However, those have difficult entry points for the average Web2 user and most Web3 audience.
That’s why the companies are now competing for the audience by creating a simpler user experience within DeFi products. This way, they want to lower that barrier and make the products more mass-market-oriented.
Andrey Lazorenko, CEO at IdeaSoft

In tandem with these developments, the regulatory landscape is anticipated to mature, offering clearer guidelines and frameworks for the coexistence of DeFi and CeFi. This regulatory clarity is poised to play a pivotal role in encouraging mainstream adoption, providing a stable foundation for the growth and evolution of the financial ecosystem.

Today, investors have no desire to invest in small projects with just “an idea” in the roadmap as it was in 2021. They have realized all the DeFi threats. They understood that CEX and DEX are like banks with additional benefits. As a result, the blockchain world aims to adopt the standard СeFi products, port them to the decentralized world, and improve with DeFi features.
German Stognieev, CTO at IdeaSoft

Does DeFi have a future? Yes, of course! The future of DeFi and CeFi is not a binary choice but a harmonious evolution, blending the best attributes of both worlds to redefine the future of finance.

Summary

Centralized and decentralized finances have both advantages and disadvantages. For example, DeFi has no intermediaries that inflate prices, while CeFi offers convenient transaction tools. Nevertheless, bridging DeFi and CeFi can be extremely beneficial.

Now, you understand DeFi and the future of finance. Are you ready to be at the forefront of creating DeFi with CeFi platform? Or maybe you want to develop a crypto exchange platform? Contact us at IdeaSoft right now! Together, we will build a future where secure, user-centric, and efficient crypto projects become the new norm.

Blockchain-Based Identity Verification System Development

Today, businesses are getting more interested in developing blockchain-based identity management systems. This is because our digital identity plays a crucial role in digital transactions. According to the Digital Payments Global Market Report 2023, the digital payments market will grow to $197.87 billion in 2027 at a CAGR of 15.5%. This means that people will make even more transactions using their data.

At IdeaSoft, we know how to integrate blockchain in the finance app. This is why we aim to shed light on this subject and delve into its critical aspects. This article will discuss the benefits of blockchain for identity management, how to use blockchain to verify virtual ID, digital ID limitations, and how to develop a blockchain-based identity management system.

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Table of content:

What Is Digital Identity?
Digital ID Limitations
Benefits of Blockchain Identity Management Solutions
Developing a Blockchain-Based ID: Main Steps
Summary

What Is Digital Identity?

Digital identity serves as a virtual representation of your personal information. It is the key to verifying your online presence. Virtual identity empowers you to confirm your authenticity when logging into your email account or conducting secure online transactions without presenting physical identity documents such as a passport or credit card.

Digital Identity Solution Market size was valued at USD 25.2 billion in 2022 and is anticipated to register at a CAGR of 16% between 2023 and 2032. The rising workforces and connected networking devices are propelling the demand for digital identity solutions that offer better security to organizations.

Nevertheless, data breaches remain one of the most significant issues for digital identity solutions. This is why modern technology companies strive to solve this problem by managing identities with blockchain technology. This technology can transparently protect data from fraudsters. And this is what we are going to discuss further in this article.

Digital ID Limitations

Digital identity development limitations can present hurdles even with innovative blockchain technology. While identity management with blockchain can revolutionize this domain, several challenges and obstacles still must be addressed to fully realize its potential.

Current digital ID limitations:

Regulations. European digital identity faces legislation, such as GDPR, that imposes strict regulations on the form and types of data storage. For instance, sensitive data like passports, medical records, and tax identification numbers cannot coexist in a single resource with unified access, as it poses a significant risk in a data breach. Consequently, the most successful digital identity solutions development often occurs in emerging countries with less stringent governmental restrictions on personal data storage and transmission, such as Ukraine, or in regions like Asia (e.g., UAE).
Emerging technology. Despite a decade of discussions about implementing digital identity, there are still limited global use cases, and their implementation remains challenging. This is especially true for blockchain-based solutions, which were hampered until recently due to the public accessibility of all data stored in public blockchains. Additionally, creating something entirely new and unprecedented in the world presents inherent challenges, as the potential implications and difficulties during development are often unclear.
Entity definition. Determining who manages the data and balancing restricted access with comprehensive access control can be complex. Finding a way to redefine how data is collected and accessed, especially in a blockchain context, is a significant challenge that needs innovative solutions.

The development of the digital identity sector is undeniable. Currently, digital identity solutions in the USA and Europe are represented by private corporations, including young startups. They are actively working on their own initiatives to achieve technological breakthroughs. Some of them have already succeeded as they see a lot of advantages.
Andrei Lazorenko, CEO at IdeaSoft

Benefits of Blockchain Identity Management Solutions

Here are the main benefits of blockchain-based identity management systems:

Cost savings. Companies won’t need entire compliance departments to enter and verify data. This operational workload is reduced.
Time efficiency. Registration processes everywhere will become quicker and less prone to human error, saving time spent on data processing.
User convenience. In Europe or America, bank registration can take weeks, involving document verification and background checks, especially for foreign citizens. This causes delays of months. Digital identity can alleviate this inconvenience, enabling near-instant registration at lower levels and faster processing for high-level data access.
Security and transparency. All data will be accessible within a single system, significantly reducing fraud and deception at all levels, from enrolling a child in daycare to identity theft.

Many financial institutions, including central banks, will soon need to embrace market conditions and adopt digital identity for user verification and account opening. Therefore, many must consider implementing blockchain for identity verification and its potential benefits for their businesses right now.

Developing a Blockchain-Based Identity Management System: Main Steps

Now, let`s discuss how to create a blockchain-based identity verification system in 5 steps.

Project Scoping and Stakeholder Expectation Management

The first step in a blockchain-based identity management system development is to identify the target audience. Understanding who will use the system and benefit from it is vital. Typically, the target audience includes:

Individual users. These people will use the system for secure access to services, digital documents, and transactions.
Businesses. Organizations that may want to integrate the system for employee authentication, customer onboarding, and secure data sharing.
Government agencies. Entities looking to enhance citizen services, streamline blockchain identity verification, and protect sensitive data.

Next, you must outline the specific features and functionality required for your blockchain identity solution. These features may include:

Decentralized identity verification. Using blockchain for identity verification by securely verifying and validating user identities without a central authority is important.
Self-sovereign identity. You should empower users to have control over their identity information, granting access as needed.
Privacy and security. Implementing robust encryption and cybersecurity measures to safeguard user data is a must.
Interoperability. You should ensure the system can seamlessly integrate with existing platforms and services.

In any project, it is also necessary to clearly define the roles and responsibilities of stakeholders.

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Choosing the Right Blockchain Platform

When it comes to use blockchain in identity management, it’s crucial to select the most suitable platform to meet your needs. In the current landscape, one of the most effective methods for achieving this is utilizing public blockchain shard chains.

Here are a few successful blockchain development platforms based on which you can develop blockchain-based identity apps.

Polygon Supernets

Polygon Supernets are application-specific chains operating on the Polygon Edge consensus client with PolyBFT consensus. These networks enhance data storage, processing power, and transaction capabilities through scaling solutions, including layer-2 techniques, parallelization, and ZK technology.

Avalanche Subnet

Avalanche Subnet is an independent and sovereign network within the Avalanche ecosystem that defines its own rules regarding membership, token economics, and consensus mechanisms. Subnets consist of a dynamic group of Avalanche validators collaborating to achieve consensus on the state of one or more blockchains. A single Subnet validates each blockchain, but a Subnet can validate multiple blockchains.

Avalanche’s Primary Network is a unique Subnet comprising three coexisting blockchains: the Platform Chain (P-Chain), the Contract Chain (C-Chain), and the Exchange Chain (X-Chain). Importantly, every validator in a Subnet must also validate the Primary Network.

NEAR Nightshade

NEAR Nightshade is a developer-friendly blockchain designed for scalability and decentralization. It employs “sharding” technology to ensure high-speed and low-cost transactions, addressing common issues like network congestion and high fees. It processes approximately 1.3 million daily transactions with near-instant finality.

Designing the Identity Management System

The design phase is critical to ensure a robust, secure, and user-friendly blockchain-based digital identity system. The user interface should feature:

Simplicity. Ensure a clean, easy-to-navigate design that accommodates users of all technical backgrounds.
User control. Empower users to manage their identity easily, including adding, updating, or removing information.
Accessibility. Ensure the system is accessible to individuals with disabilities, adhering to inclusive design principles.
Multi-platform compatibility. Develop a responsive design that functions seamlessly on various devices and browsers.

User experience should be prioritized:

Onboarding guidance. Create clear instructions for users to create and manage their digital identity.
Feedback and notifications. Provide real-time feedback during processes like identity creation and notify users of important actions.
Security awareness. Educate users about the security features in place and best practices for protecting their digital identity.

A secure authentication and authorization process is also paramount. Key elements include multi-factor authentication (MFA), token-based authorization, role-based access control (RBAC), and audit trails.

Testing and Deployment

After designing a robust blockchain-based identity management system, the next crucial steps involve thorough testing in a staging environment and secure deployment to production.

Testing in a staging environment is essential to identify and address potential issues before deploying the system to production. The following types of testing are critical:

Functional testing. Ensure that all features and functionalities work as intended. Test user registration, identity verification, and data management processes.
Security testing. Perform vulnerability assessments, penetration testing, and code audits to identify and mitigate potential security risks.
Performance testing. Evaluate system responsiveness, scalability, and resource consumption under various loads. This helps ensure the system can handle high user volumes.
Usability testing. Collect feedback from users or testers to evaluate the system’s user-friendliness and identify areas for improvement in the user experience.
Compatibility testing. Confirm that the system functions correctly on different devices, browsers, and operating systems.
Data integrity testing. Verify the accuracy and consistency of data stored on the blockchain and associated databases.
Load testing. Assess how the system performs under peak loads and ensure that it can handle a large number of concurrent users.

Once thorough testing in the staging environment has been completed, it’s time to deploy the system to the production environment.

Ongoing Maintenance and Support

Blockchain-based identity management system requires ongoing maintenance to succeed. Identifying and resolving software bugs is an ongoing process to maintain a reliable and secure identity management system. At the same time, adapting to changing user requirements and emerging technologies requires adding new features. This process entails:

User needs assessment. Continuously gather user feedback and assess emerging needs to identify potential areas for improvement.
Feature planning and development. Develop a roadmap for adding new features, prioritizing those that align with user needs and strategic objectives.
Testing and QA. Rigorously test new features to ensure they function correctly and do not negatively impact existing system components.

Security enhancements are also critical to protect user data and maintain user trust.

Summary

By leveraging blockchain’s decentralized and secure nature, blockchain-based identity application development addresses many challenges, from reducing identity fraud to streamlining insurance processes, minimizing document forgery, and combating the spread of fake news on social media platforms.

With its potential to revolutionize multiple industries and facilitate cross-sector collaborations, blockchain-based identity application is a driving force behind global digitization. It can create a more secure and efficient digital environment.

Are you ready to be at the forefront of this digital revolution? Contact us at IdeaSoft right now! Together, we will build a future where secure, user-centric, and efficient digital identities become the new norm.

Crypto Wallet UI Design. Top 5 Best Practices

The crypto wallet market has grown significantly due to the increasing acceptance of cryptocurrencies as a legitimate asset class. This growth is also driven by the growing demand for secure and user-friendly storage solutions. A recent 2023 report by Grand View Research forecasts a projected compound annual growth rate (CAGR) of 24.8% from 2023 to 2030 (Grand View Research Forecast).

However, some companies still hesitate to use cryptocurrencies because of technical challenges. One of the main problems is making crypto wallet ui designs that are both easy to use and secure. At IdeaSoft, we design crypto wallet UI not only for storing and transferring digital assets. Our DeFi wallets guarantee top-notch security and convenience for all your cryptocurrency transactions.

This article delves into crypto wallet ui design drawing on the firsthand experiences of our expert developers. We will also share a few very effective techniques for creating wallets that are not only user-friendly for both beginners and experts but also resilient against hacking attempts and other fraudulent activities. Let’s dive in!

Table of contents:

Top 5 Recommendations on How to Create Stunning Visuals for Your Crypto Wallet UI
Why develop a custom crypto wallet UI/UX design?
Crypto Wallets UI/UX Case Studies
Why choose IdeaSoft for crypto wallet UI/UX design?
Summary

5 Recommendations on How to Create Stunning Visuals for Your Crypto Wallet UI

Together with our team, we’ve accumulated years of invaluable experience in ui for blockchain solutions. During this time, we’ve identified five crucial best practices that young designers and product owners should carefully consider. Let’s delve into these practices in more detail.

Step 1. Analyze end-user needs and competitors

Creating a successful ui for blockchain solutions demands a deep understanding of user needs and pain points, emphasizing intuitive UI and seamless UX. Effective design relies on comprehending the diverse familiarity that users might have with various cryptocurrencies.

Beginner traders need basic features such as buying, selling, and tracking portfolios on their mobile apps. Experienced traders prefer advanced terminals for market analysis, often on tablets or mobile phones. To better serve users, it’s crucial to research and tailor the crypto wallet design to their needs.

Standing out in the cryptocurrency wallet market is crucial, and keeping an eye on competitors is a key. Stay updated with their strategies and the latest technologies they adopt. Analyze leading crypto wallet app designs to identify unique features for your application. Awareness of market trends is essential for gaining a competitive edge. Use your research findings to craft a user-engaging crypto wallet ui. Focus on seamless navigation, address your audience’s needs, and attract potential users. These factors ensure a good user experience, keeping users interested and attracting new ones. Ultimately, leveraging UI/UX for conversion optimisation will boost user retention and drive higher conversion rates.

Step 2. Provide data visualization when creating a crypto wallet UI

Developing a cryptocurrency app design presents a formidable challenge for software engineers. They manage a lot of data, like transaction history, portfolio balances, and market prices. This data needs to be carefully stored and processed. The crypto wallet ui design must adeptly visualize the constantly updating information, even with many changes per second. The ultimate aim is to present this wealth of data in a manner that is not only clear and concise but also comprehensible to users. To achieve this, employing sophisticated data visualization techniques is indispensable.

To make it easier for users, add interactive charts and graphs to the app’s interface. Users can easily understand transaction trends, portfolio balances, and market price changes using these visual tools. To make things clearer, use different colors to show different types of transactions. This will help users understand their financial activities quickly.

Visual guide: Navigating the features and functionality of Dollet Wallet on the 'How It Works' page. — *Exploring the Functionality: Inside the ‘How It Works’ Page of our* *Dollet Wallet*

Users should be able to customize their viewing experience with real-time updates and dashboards. In addition, using interactive maps and illustrative infographics can enhance the user experience. These visuals make the information clear, interesting, and easy to understand. To keep users engaged, it’s important to have thoughtful design elements which let users explore financial metrics and exchanges.

Step 3. Make a crypto app easy to use

When creating a modern Web 3.0 app, it’s important to find a balance between functional design and technical complexity. This is especially true for crypto wallets. When making a crypto app design, it is important to consider the technical specifications of the elements that will be used, such as blockchains, smart contracts, NFTs, and cryptocurrencies.

The crypto wallet design should also be tailored to the specific infrastructure of the app. The design should be optimized for the specific blockchains the wallet supports. It should consider the features and functionality the wallet needs to provide.

Skilled blockchain ui designers, like those at IdeaSoft, select web 3.0 elements and tools based on project requirements and business needs. By doing so, they ensure optimal performance and alignment with client objectives. The careful blending of technical parts improves how businesses and clients see things, making them easier to use.

Another step towards enhanced user confidence is clear and jargon-free instructions. Along with visual aids, it can ease task comprehension and cater to users with varied expertise levels.

Step 4. Educate users and explain crypto benefits

Cryptocurrencies may still remain a relatively new topic for some, so people may be hesitant to use them. It’s understandable because crypto trading has complex jargon and tools that are hard to grasp. To make cryptocurrencies more user-friendly, we need to address people’s concerns and uncertainties:

Give simple and short info on cryptocurrencies within your UI/UX design concept;
Craft usable tools and resources for people new to cryptocurrencies that are easy to use and understand;
Create educational programs and content to teach people about cryptocurrency usage.

Educational content is important for users to have a better experience with the crypto app. Strive to design onboarding tutorials explaining essential concepts and offer on-demand instructions. Adding a helpful blog to the app can enhance the user experience. It can provide newcomers with the information they need to understand cryptocurrencies. This educational approach helps users understand and feel more confident when using crypto apps.

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Step 5. Design for trust and security

Security stands as the cornerstone of cryptocurrency app design. To protect your product from hacking attempts and leaks, use industry-standard practices like data encryption and secure key management. Another crucial security feature is automated session logout, adding an extra layer of safety to your digital wallet app. This functionality ensures that authorized parties with specific permissions can access the app. After each session ends, the system logs out users automatically. This confirms the safety of in-app processes and crypto transactions.

Clearly communicate your security measures to users, ensuring they are aware of the protective measures in place to safeguard their data and transactions. Providing transparent information fosters trust and confidence among users, establishing a strong foundation for a secure crypto app. Reliable systems not only enhance security but also contribute to your crypto wallet app’s reputation, making it appealing to a broader audience.

Why develop a custom crypto wallet UI/UX design?

Your business is unique and has its specific niche in your field and so is the tool of tomorrow – your crypto wallet. To make your crypto app design truly usable and efficient for your customers, you need to craft it having your users in mind. A custom crypto UI/UX design like those created by IdeaSoft design team can multiply your revenue and increase users’ flow as it provides undisputable benefits:

Market Distinctiveness. A tailored UI/UX design sets your crypto wallet apart, creating a unique and memorable user experience. To stand out in the market, make your wallet unique and catch users’ attention. This will help you establish a strong identity in the competitive landscape.
Audience Needs Compliance. Custom designs allow you to cater specifically to your target users. To make a user-friendly interface, learn what users like, how they act, and what frustrates them. Such a tailored approach enhances user satisfaction and encourages long-term engagement.
Better Security. Creating personalized crypto wallets can enhance security by adding advanced features and customize user interface. You can make transactions and data storage safer by adding strong authentication methods. For instance, you can use two-factor authentication (2FA) and multi-signature wallets. This can help build trust with users who are concerned about the safety of their digital assets.
Boosted Brand Awareness. A unique and intuitive UI/UX design becomes an extension of your brand identity. Consistent branding elements, combined with an intuitive interface, reinforce brand recognition. A good experience makes people like your crypto wallet and tell others about it. This grows your user base and makes more people aware of your brand.

Crypto Wallets UI/UX Case Studies

At IdeaSoft, our blockchain team leverages extensive expertise in crafting bespoke digital wallet solutions for the cryptocurrency landscape. We approach each cryptocurrency app design project with a customized development strategy that fits your unique needs and goals. One stellar illustration of our tailored approach is the Dollet Wallet project, where our UX team designed a cutting-edge crypto wallet.

Snapshot of our latest project: A visual overview showcasing innovative endeavor and achievements of the Dollet Wallet project. — *Project Snapshot: A Visual Overview of* *Dollet Wallet*

Dollet, a non-custodial mobile crypto wallet, meets the complex needs of experienced crypto enthusiasts and frequent users. Its multi-chain and bridge functionalities provide seamless asset management and exchange across various blockchains. Dollet offers secure crypto solutions that stand out in the market. The platform supports ERC-20 tokens and integrates DeFi strategies – all within a clear interface. Developed in 6 months by a skilled team of 10 members, Dollet excels in both functionality and user experience.

Why choose IdeaSoft for crypto wallet UI design?

Crafting a successful crypto wallet app ui requires the right blend of functionality, strategic efficiency, and expertise. Now is the perfect time to start your cryptocurrency wallet project with our expert team.

Our proficient team of experts harnesses a versatile range of state-of-the-art software tools and technologies to craft exceptional user interfaces and user experiences for crypto wallets. This impressive toolkit includes industry favorites such as FigmaJam, Spline, Adobe Creative Cloud, Sketch, and Zeplin.

What truly distinguishes us is our ability to seamlessly adapt our technology stack to align perfectly with your project’s distinct requirements. This adaptive approach empowers us to deliver tailored solutions that will intricately mold the design of your crypto wallet app.

Furthermore, our team possesses unique expertise in web3 UX design and its intricate specifications. We understand precisely how DeFi and web3 apps should function to ensure a smooth user experience. By selecting our services, you’re not only gaining access to a versatile toolkit but also tapping into a wealth of knowledge and experience that guarantees a user-friendly and intuitive design for your crypto wallet app.

Additionally, our approach to bento box web design ensures that each element of your UI is thoughtfully placed and easily accessible, enhancing the overall user experience. This method organizes features and functions in a compact, efficient layout, akin to a bento box, allowing users to navigate your crypto wallet app effortlessly.

Summary

We’re here to help you through every step of your project. We have a team of skilled and experienced blockchain ui designers. Together, we’ll create a custom solution that helps you achieve your business goals. Reach out to us today using our Contact Page, and let’s discuss how we can help you create a crypto wallet app design that drives your business forward.

How to Create an Algorithmic Stablecoin: The Ultimate Guide

Recently, the landscape of algorithmic stablecoins has seen significant growth and technological advancement. What was once an obscure concept has now gained widespread attention and recognition. As a result, there is a large demand for understanding this technology as well as stablecoin development companies.

At IdeaSoft, we have significant expertise in DeFi, stablecoins, and DEX/CEX domains. This is why we aim to shed light on this subject and delve into its critical aspects. This article will discuss what are algorithmic stablecoins, the benefits and challenges of algorithmic stablecoins, the algorithmic stablecoin development process, and real-world examples of successful technology implementations.

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Our experienced team is well-versed in the nuances of stablecoins. We can provide invaluable insights to help navigate the algorithmic stablecoin development challenges and help you build a secure solution. Feel free to contact us right now!

Table of content:

What is an algorithmic stablecoin?
Benefits and challenges of algorithmic stablecoins
How to develop a stablecoin? Step-by-step guide
Real-world examples
Summary

What is an Algorithmic Stablecoin?

An algorithmic stablecoin is a digital asset which is governed by algorithms to reduce the price volatility. For example, if a coin is pegged to the U.S. dollar in the proportion of 1:1, its rate should always be close to the mark of 1 dollar. An algorithm handles the stabilization of algorithmic stablecoins. It keeps the exchange rate close to a given mark.

Unlike classic stablecoins such as Tether (USDT), algorithmic stablecoins are decentralized. The lack of a single control body for the asset circumvents counterparty risk. As a result, holders of these stablecoins rely on the algorithm.

Benefits and Challenges of Algorithmic Stablecoins

Algorithmic stablecoins operate decentralized. Their issuance, circulation, and burning processes are managed through smart contracts. This decentralization enhances the efficiency of investing in such stablecoins. It also facilitates rapid ecosystem scaling as the user base expands.

As a consequence of this decentralization, it is impossible to lock algorithmic stablecoins into users’ wallets. As for centralized stablecoins, they can be frozen or blocked by the issuing company. This practice has been already employed on several occasions.

However, algorithmic stablecoins face systemic challenges inherent to the DeFi industry. They include:

Exploitation of smart contract weaknesses. Attackers can take advantage of bugs in the smart contracts that manage the issuance and pegging of stablecoins. They can undermine the coin’s stability.
Oracles malfunctioning. Price manipulation can occur when oracles do not function correctly. Oracles are external data sources used to determine a stablecoin’s value. Manipulating these inputs can distort the stablecoin’s price.
Information attacks. Stablecoins are susceptible to information attacks aimed at panic selling and price manipulation. These attacks can trigger a loss of the coin’s peg.

This is why if you want to make an algorithmic stablecoin that will surpass all the competitors, you must consider all the possible challenges. IdeaSoft team take particular attention to smart contract security and apply 100% unit test coverage to all contracts that are being developed by our team. In addition we provide an in-house testing and debugging at the different stage of smart contract development to deliver a secure technology for you.

How to Develop an Algorithmic Stablecoin? Step-by-Step Guide

Here, we have discussed a step-by-step guide on how to build an algorithmic stablecoin.

Identify the blockchain platform you need

Selecting the right blockchain network is pivotal for developing your own algorithmic stablecoin. It will impact the security, scalability, interoperability, and cost-efficiency of your stablecoin. Here are key factors to contemplate when making your choice:

Security. It’s essential to pick a blockchain network with a strong security track record. It also must have advanced security measures. We mean multi-signature authentication, two-factor authentication, and robust encryption.
Scalability. The scalability of the blockchain impacts your algorithmic stablecoin transaction volumes. Choose a blockchain with swift transaction processing, high throughput, and reasonable transaction fees.
Interoperability. Interoperability is crucial for your stablecoin’s acceptance and utility. Choose a blockchain that can effectively interact with other networks and protocols.
Cost-effectiveness. Building algorithmic stablecoins can be costly due to gas fees and development expenses. Evaluate the cost-effectiveness of your chosen network and weigh it against its benefits.

Our experts at IdeaSoft are always here to provide advice and support. No matter what stage you are at in developing your algorithmic stablecoin, our specialists can always provide expert advice and assistance in selecting the right blockchain. Even if you want to develop a blockchain application, our team can help you.

Consider the maintenance of liquidity

For algorithmic stablecoin development you must think about liquidity in advance. Gauging the total liquidity necessary for establishing a stablecoin is paramount. It guarantees the stability and steadfast peg of the stablecoin to its underlying asset. The requisite liquidity hinges on both the total supply of the stablecoin and the prevailing market value of the underlying asset.

The level of collateralization must be administered diligently. Excessive collateralization can lead to diminished investor returns due to surplus liquidity. Conversely, inadequate collateralization may precipitate instability, erosion of trust, and dwindling liquidity, eventually causing the stablecoin to deviate from its intended peg.

Algorithmic stablecoins operate differently from collateralized stablecoins. They rely on algorithms and smart contracts to regulate their supply and maintain stability without traditional assets as collateral. Here are 3 basic sources of liquidity you can use to create your own algorithmic stablecoin:

Seigniorage. Stablecoins generate seigniorage (the profit derived from issuing and managing the stablecoin). When the stablecoin’s price rises above its target value, new tokens are minted, sold, or distributed to holders. This generates income. This income can be used to support and stabilize the stablecoin.
Liquidity pools. These pools can ease trading and maintain the stablecoin’s peg. Liquidity providers earn fees for their contributions.
Oracles and market data. Algorithmic stablecoins often rely on oracles to determine their supply adjustments. Accurate and reliable oracles are crucial to ensure that supply changes align with market conditions.

It’s important to note that proper governance and active management of these liquidity sources are essential to maintaining the stablecoin’s peg. They are also crucial for preventing significant price fluctuations. To develop an algorithmic stablecoin that surpasses the competition, you must consider liquidity in advance.

Develop a smart contract

Smart contracts are self-executing digital agreements. The terms of the arrangement between transacting parties are encoded into its code. These contracts trigger when predefined conditions are met.

In the context of creating algorithmic stablecoins, smart contracts serve to automate critical aspects of the coin’s behavior. They encompass stablecoin issuance and redemption, collateral reserve management, and the implementation of mechanisms for price stabilization.

Smart contract testing

Smart contract testing & debugging is of paramount importance when developing your own algorithmic stablecoin. These smart contracts are responsible for managing the stablecoin supply, making critical decisions, and ensuring that the stablecoin’s price remains pegged to a specific value.

Suppose a smart contract is not secure. In that case, it can lead to a wide range of problems and potentially devastating consequences, including:

Loss of funds
Hacks and exploits
Asset liquidations
Price manipulation
Privacy breaches
Loss of trust

To create an algorithmic stablecoin, thorough security audits, code reviews, and rigorous testing are essential during the development of smart contracts. We strongly recommend achieving 100% unit test coverage for all your smart contracts. Our reputation proves our desire to build only secure real-world asset tokenization solutions, DeFi apps, smart contracts, and stablecoins.

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Blockchain platform integration and launching

Integrating tokens with a blockchain platform is the last step in algorithmic stablecoin development. Here, developers align the stability mechanisms encoded in the smart contracts with the blockchain’s infrastructure. This integration ensures the stablecoin’s price stability. It also ensures that functionality can be reliably maintained within the decentralized ecosystem.

Best Blockchain Platforms for Stablecoin Development

In 2024, there are many different blockchains you can use to create an algorithmic stablecoin. You can choose from:

Ethereum
Binance Smart Chain
Solana
Avalanche
Polkadot

In our experience, the most popular blockchains for creating algorithmic stablecoins are Ethereum, BNB Chain, and TRON. Each network has unique advantages and limitations. Conducting a thorough assessment based on your specific requirements and objectives is imperative.

Real-world Examples

Here, we want to discuss 2 notable algorithmic stablecoins in the market. These examples will help you develop an algorithmic stablecoin to surpass the competition.

Synthetix USD

algorithmic stablecoin development — *Image Source*

Synthetix USD is one of the most prominent algorithmic stablecoins in cryptocurrency. Constructed on the Ethereum blockchain, SUSD is the brainchild of the Synthetix team. By the way, it is a leading player in decentralized synthetic asset issuance.

SUSD taps into the Ethereum blockchain’s capabilities to ensure the steadfastness of its value. The platform employs a distinctive mechanism to uphold the SUSD’s peg to the US dollar. It involves collateralized debt positions (CDPs) and its native SNX token.

Demand for stablecoins in the cryptocurrency space continues to grow. This is why SUSD has emerged as a sought-after and adaptable stablecoin choice for users immersed in the DeFi ecosystem.

FRAX

developing your own algorithmic stablecoin — *Image Source*

FRAX is an algorithmic stablecoin developed in 2020 by Sam Kazemian and Travis Moore. FRAX has drawn considerable attention due to its unique approach to maintaining price stability. It operates on the Ethereum blockchain. It harnesses the power of smart contracts and sophisticated algorithms to regulate its supply according to market demand. This way, it ensures its price stability.

The key to FRAX’s success lies in its ability to steadfastly peg itself to the US dollar. It grants users a dependable and steady store of value within the turbulent crypto market.

Summary

Achieving the goal of a truly stable digital currency is not without its challenges. Success requires a combination of technical prowess, economic insight, and regulatory compliance.

For those seeking expert guidance in how to develop an algorithmic stablecoin, IdeaSoft offers comprehensive consultation services. Fill in the form below and we will be in touch within 2 business days!

What is Web 2.5 and How Is It Different from Web2 and Web3

In an era marked by rapid technological advancements, the internet has undergone a remarkable journey of transformation. As we navigate this digital generation, the term “Web 2.5” has emerged as a captivating subject of discussion and exploration.

This article delves into the intricacies of Web 2.5, shedding light on its significance in the ever-evolving landscape of the Web. As curiosity about the Internet’s evolution grows, we explore what makes Web 2.5 different from Web 2 and Web 3. Join us as we unravel the key features of Web 2.5 and its practical implications.

Want to empower your web2 solution with blockchain?

IdeaSoft offers expert consultation and tailored solutions to help businesses navigate the Web 2.5 landscape successfully. Our team can provide guidance on technology integration, user-centric design, and strategies for harnessing the capabilities of Web 2.5 to achieve your specific goals. Feel free to reach out to us for personalized guidance.

Table of content:

Understanding the Evolution of the Web 2.5
Web 2.5: The Intermediate Stage
Contrasting Web 2.5 with Web 2
What makes Web 2.5 different from Web 3
Practical Implications of Web 2.5
Key Web 2.5 Insights for Product Owners
Building and Using Web 2.5 Applications
Summary

Understanding the Evolution of the Web 2.5

To understand what Web 2.5 is, it’s essential to first establish a foundational understanding of its predecessors. Web 2, often referred to as the “Social Web” marked a pivotal shift in the internet’s narrative. It introduced concepts like user-generated content, interactivity, and collaboration, giving rise to influential information platforms such as Facebook, YouTube, and Wikipedia.

This era transformed the web into a dynamic space where users played an active role in content creation and sharing.

Web 2.5, while not universally defined, can be seen as an intermediate stage between Web 2 and the anticipated Web 3. It likely encompasses advancements like augmented reality, virtual reality, and enhanced data analytics, offering users more immersive and personalized digital experiences. For businesses transitioning to Web 3, outstaffing Web3 developers is an efficient way to access specialized expertise and accelerate project timelines.

As we approach Web 3, the focus is on making web data more machine-readable and interconnected with techs like blockchain and advanced AI. This understanding guides our exploration of the key features of Web 2.5 and their role in the Internet’s future.

Web 2.5: The Intermediate Stage

Web 2.5 represents a pivotal phase in the ever-evolving landscape of the internet. It can be characterized by several key features that set it apart from Web 2 and Web 3. This intermediate stage builds upon the foundations of Web 2, where user interaction and content creation were paramount, but it also integrates emerging technologies that foreshadow the forthcoming Web 3.0.

The key features of Web 2.5 include an increased emphasis on user immersion and personalization. This phase brings forth augmented reality (AR) and virtual reality (VR), which aim to blur the lines between the digital and physical worlds. Additionally, Web 2.5 leverages the capabilities of artificial intelligence (AI) and blockchain technology. AI enhances user experiences by understanding behaviors and preferences, enabling more tailored content recommendations. On the other hand, blockchain bolsters security, transparency, and trust in transactions, revolutionizing various industries, including finance, supply chain, and digital collectibles.

Web 2.5 is often regarded as an intermediate stage due to its transitional nature. It uses emerging tech for better user engagement but doesn’t fully adopt the decentralization and semantic web aspects of Web 3. Instead, it acts as a bridge between Web 2 and the future, where blockchain, AI, and decentralized systems shape the Internet’s evolution. As we delve deeper into Web 2.5, we’ll uncover how these technologies redefine online experiences and pave the way for the internet’s next chapter.

Contrasting Web 2.5 with Web 2

When comparing Web 2.5 to Web 2, several notable distinctions emerge. Web 2 marked a significant shift with the widespread adoption of social media, cloud computing, and mobile devices, resulting in the continuous introduction of new apps to mobile app stores. However, Web 2.5 goes beyond introducing immersive technologies like AR and VR. These innovations reshape digital content interaction, providing dynamic and interactive experiences that extend beyond conventional text-based communication.

Another notable contrast lies in data ownership and control. In Web 2, data resided within tech giants that monetized user-generated content and interactions. Web 2.5 places a stronger emphasis on individual ownership and control of personal data. Tech companies in this phase often focus on data security, privacy, and consumer consent. This gives individuals more agency over their digital identities.

What makes Web 2.5 different from Web 3

While Web 2.5 represents a significant advancement in the evolution of the Internet, it is important to compare it to the emerging Web 3 and its applications to appreciate the core distinctions between these phases. One of the fundamental differences lies in the concept of decentralization.

Web 3, often associated with the “Decentralized Web” or the “Semantic Web,” envisions a digital landscape where data and applications are distributed across a network of nodes, eliminating the need for central authorities. In contrast, Web 2.5 retains certain centralized elements, especially in the deployment of AR and VR experiences, which may rely on centralized servers and platforms for content delivery and interaction.

Blockchain technology plays a crucial role in distinguishing Web 3 from Web 2.5. Web 3 emphasizes leveraging blockchain for trust, security, and transparency across various sectors, such as finance, supply chain, and identity management. Blockchain serves as a decentralized ledger, ensuring the security and integrity of transactions and data, a feature that differs from Web 2.5.

In contrast, when using Web 2.5 for blockchains, it allows for a certain level of centralization, making it more user-friendly and accessible. This approach allows individuals to gradually adapt to blockchain technology without feeling overwhelmed by its complexities, which differs it from the more fully decentralized approach witnessed in Web 3.

Web 3 also incorporates advanced artificial intelligence (AI) and machine learning (ML) technologies to enhance user experiences and enable intelligent data analysis. These AI and ML capabilities empower Web 3 applications to understand, interpret, and respond to user behavior and preferences. In contrast, Web 2.5 primarily focuses on adopting AR and VR technologies.

In summary, while Web 2.5 represents a significant step forward in user immersion and personalization, Web 3 introduces a more profound paradigm shift with its emphasis on decentralization, blockchain, and the incorporation of advanced AI and ML technologies. These core distinctions between Web 2.5 and Web 3 illuminate the evolving landscape of the Internet and offer unique opportunities and challenges in each phase.

Practical Implications of Web 2.5

In the era of Web 2.5, businesses face the challenge and opportunity of adapting their strategies to harness the full potential of emerging technologies.

Our experts have identified three key technologies where Web 2.5 holds the most promise and potential for businesses.

Blockchain Integration

Incorporating blockchain technology to enhance security, transparency, and trust in transactions can involve various applications. This includes utilizing blockchain for supply chain management, facilitating secure cross-border payments, and verifying the authenticity of digital assets and collectibles.

As one of the examples of successful integration of blockchain, we can see the Hoper waste management platform developed by the IdeaSoft team. The platform combines waste management collection and a social network gathering people into communities. The primary mission behind the project was to encourage people to clean overstock trash and garbage around polluted spaces to provide safer environments.

For this purpose, we created a reward system based on Hopercoin tokens. Platform users receive tokens for cleanup cases. Then they can exchange Hopercoin for the products and services offered by the platform partners and investors.

Tokenization

Tokenization in the context of Web 2.5 carries numerous practical implications with the potential to reshape our digital experiences. It empowers individuals with true ownership and control over digital assets, reducing reliance on centralized platforms. In supply chain management, it bolsters transparency by tracking products and verifying authenticity. Tokenization also streamlines cross-border payments and fuels the gaming industry by allowing true ownership of in-game assets. This way, its promotion of decentralization reduces the need for intermediaries in various industries.

One of the most prominent and known use cases of asset tokenization nowadays is represented by NFT-based platforms. For instance, BridgeTower is a global marketplace built on a proprietary technology stack that
uniquely bringing products constructed with regulatory compliant adherence in order to enable an institutional gateway to Staked Securities, Turnkey Customized Institutional Staking, Financial Products, and Web 3.0 entities. The platform utilize NFT technology to tokenize those assets and enable seamless access for users.

Fintech

In fintech, Web 2.5 introduces many practical benefits. Advanced data analytics and machine learning algorithms in Web 2.5 enable fintech companies to gain deeper insights into user behavior and preferences, leading to more personalized financial recommendations and risk assessments.

These technologies also contribute to improving overall system security and minimizing fraud. Additionally, Web 2.5’s focus on interoperability allows for seamless integration of financial services across platforms and applications, streamlining processes like cross-border payments and lending.

Blockchain integration into fintech facilitates asset treacebility and transparency while enabling automated asset issuance. One of the most known examples of a successful implementation of such integration is Securitize platform which is a full-stack technology solution for issuers of digital securities. The platform enables the compliant trading of private securities on public blockchains and multiple exchanges.

Key Web 2.5 Insights for Product Owners

As you can see, many businesses can use these technologies to compete and offer something special in the open Web 2.5 era. Yet, successful integration often relies on web developers’ and designers’ expertise and guidance. They play a pivotal role in transforming abstract ideas into tangible and engaging experiences. Below, we present some key considerations for them to harness the capabilities of Web 2.5:

Skill Development

Web developers and designers need to get expertise in blockchain development, smart contract programming, and decentralized application (DApp) design. These skills are essential for creating secure and user-friendly blockchain-based applications.

User Experience

Designers should focus on delivering intuitive and visually appealing user interfaces for blockchain-powered platforms. User experience (UX) becomes crucial in ensuring that users can interact seamlessly with decentralized applications.

Constant Tech Stack Enhancement

Addressing scalability challenges is vital, as blockchain networks can face limitations in transaction processing speed and cost. Developers need to explore solutions to enhance scalability and user accessibility.

Businesses that opt for developing and using Web 2.5 applications can position themselves at the forefront of the digital revolution. Web developers and designers play a pivotal role in creating user-friendly and scalable blockchain applications, ensuring a smooth transition into the Web 2.5 era.

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Building and Using Web 2.5 Applications

The complexities of Web 2.5 might appear daunting, so it’s essential to illustrate their practical applications through real-world examples. Many businesses have already embraced blockchain technology and actively use Web 2.5 features, providing tangible evidence of the benefits of this evolving digital landscape. Let’s check the most prominent examples:

Financial Institutions

Traditional banks and financial institutions are incorporating blockchain technology into the global economy for cross-border payments, settlement systems, and even the development of their cryptocurrencies.

Supply Chain

The supply chain industry is increasingly using blockchain technology, influenced by Web 2.5, to improve transparency, traceability, and security in complex networks. Blockchain keeps an unchangeable record of all transactions and product movements, helping stakeholders track products in real-time from where they start to where they end up. This technology ensures products are genuine, reduces the risk of fraud, and cuts down on errors in supply chain records. By enhancing visibility and trust, blockchain streamlines processes, reduces delays, and boosts supply chain resilience, making it a valuable tool for the whole industry.

Tech Giants

Large tech companies like IBM, Microsoft, and other famous brands offer blockchain solutions for businesses, enabling them to develop and deploy blockchain applications.

NFT Marketplaces

NFTs represent a groundbreaking blockchain application that elevates digital content and assets, typically associated with Web2 platforms, to a whole new level. NFTs bring together the concepts of true ownership and decentralization from the Web3 era, and they come with various utilities that grant creators unparalleled control over their creations.

As you can see, many businesses across various sectors have already recognized the advantages of using Web 2.5 instead of Web 2 and Web 3 and are actively leveraging its advantages.

Summary

The changing internet landscape from Web 2 to Web 2.5 and the emergence of Web 3 brings both exciting opportunities and challenges. Web3 development cost optimization becomes crucial as businesses explore decentralized solutions. While Web 3 holds immense potential, its decentralized nature and reliance on blockchain technology can introduce complexities, impacting development costs.

If you want to understand the difference between Web 2.5, Web 2, and Web 3 better, or if you need advice on how these technologies can benefit your business, don’t hesitate to reach out to IdeaSoft experts. Our team can provide detailed consultations and customized solutions to help your business grow, including Bento Box Web Design.

Crypto Wallet App Development: A 2025 Guide

Want to develop a crypto wallet app? By 2030, the Global Cryptocurrency Payment Apps market is projected to reach over $2.108 million, growing at a CAGR of 18.52% over the next eight years (Research and Markets).

A staggering 290% increase compared to previous years is mainly driven by the widespread adoption of cryptocurrencies, market strengthening due to recent ETF approval, and wider adoption of cost-saving payments provided by layer-2 solutions. Realizing the future perspectives of cryptocurrency and its lucrative opportunities for business development, many companies already started investing in digital crypto projects.

For example, we have built Dollet Wallet – a non-custodial crypto wallet that features seamless asset management and multi-chain compatibility. Thanks to this project, we know all the ins and outs of blockchain wallet development and can discuss them with you.

In this guide, IdeaSoft developers will introduce the basics of how to create a crypto wallet app for your business. You’ll discover the core essentials of crypto wallet app development, the basic features, and the step-by-step strategy that will help you build a scalable and functional crypto application.

IdeaSoft has the expertise and a full-cycle product team on board!

Looking for an experienced team of crypto wallet developers? Let our experts share key insights on developing a custom digital solution and explain the common development challenges to help you successfully plan your crypto wallet project.

Table of content:

Why to Develop a Crypto Wallet Application?
What Are the Types of Crypto Wallets?
Essential Features in Crypto Wallet Apps
8 Fundamental Aspects for Developing a Cryptocurrency Wallet App
Our Experience in Crypto Wallet Development
Key Challenges in Cryptocurrency Wallet Development
Summary

Why to Develop a Crypto Wallet Application?

We distinguish 4 reasons why it makes sense to start crypto wallet app development:

Riding the wave of market growth. Startups develop a crypto wallet app to enter a growing market. This not only opens avenues for substantial revenue through transaction fees and premium features but also offers opportunities for innovation and brand establishment in the competitive fintech space
Promoting financial inclusion. Cryptocurrencies offer a unique solution to the challenges faced by unbanked and underbanked populations. By developing a crypto wallet application, developers contribute to financial inclusion, providing access to financial services for those who lack traditional banking facilities. Crypto wallets facilitate global transactions without the barriers imposed by traditional banking systems, thus fostering economic participation across diverse demographics.
Contributing to economic growth. Developing a crypto wallet application not only benefits individual users and businesses but also contributes to the overall growth of the cryptocurrency ecosystem. By fostering innovation and encouraging new technological developments, developers play a crucial role in advancing the blockchain space and supporting the global economy’s digital transformation.
Seizing market differentiation. By offering unique selling points such as advanced security measures, user-friendly interfaces, and additional services like DeFi integration, developers can set their crypto wallet applications apart from the competition. Strategic partnerships with other fintech and blockchain companies can also enhance the application’s value proposition, attracting a broader user base.

Overall, startups, end users (cryptocurrency holders), businesses, merchants, investors, and traders benefit from crypto wallet app development.

What Are the Types of Crypto Wallets?

The functionality and technologies required for the crypto app development will mainly depend on the type of wallet you choose. So, the first stage in understanding how to develop a crypto wallet is to identify what type of wallet can better match the app’s features, project requirements and needs. This table highlights the main differences between cold wallets and hot wallets.

crypto wallet app development — *The difference between hot and cold wallet type*

And here is a comparison table with the different wallet features we recommend you investigate before you decide to develop Bitcoin wallet application.

Feature	Cold Wallets (Hardware Wallets)	Hot Wallets	Hybrid Wallets
Definition	Physical devices designed to store cryptocurrency offline.	Software-based wallets connected to the internet.	Combine elements of both cold and hot wallets.
Security	High – private keys isolated from the Internet, resistant to online hacks.	Lower – requires an ongoing Internet connection, more vulnerable to online attacks.	Enhanced – majority of funds stored offline, small portions kept online.
Accessibility	Limited – requires physical access to the device.	High – seamless access for active trading/transactions.	Balanced – offline storage for security, online for accessibility.
Usage	Best for long-term storage of large amounts of cryptocurrency.	Ideal for active trading and frequent transactions.	Suitable for users needing both security and convenience.

The wallet type, however, is not the only aspect you need to develop a secure blockchain wallet application. Identifying the features and technologies of your future application will help you to create a cost-efficient and competitive solution for crypto payments. So, let’s review the most important features that can maximize the performance of your cryptocurrency platform.

Crypto Wallet Apps Features to Develop

Planning the app’s functionality is another essential aspect of such projects, as it allows you to understand the use cases and identify the benefits of your app compared to the existing market alternatives.

Below, we’ve outlined the most fundamental features in crypto applications, which you can apply to create a custom digital wallet app or even build your own crypto casino!

#1. User Authentication

An essential feature that enables wallet access only to authorized individuals. As a rule, user authentication is exceptionally important for meeting various crypto compliance standards such as AML, KYC, and others. Typically, it is implemented through secured login credentials, biometric authentication, or multi-factor authentication (MFA), which prevents third-party access to the crypto wallets.

#2. Support for Multiple Cryptocurrencies

Today, multi-currency apps have a strong competitive advantage compared to single-currency alternatives, like Bitcoin or Ethereum wallets. Integrations with various currencies can significantly improve the usability of your digital wallet app, making it more versatile and functional. Additionally, multi-currency crypto wallets allow asset holders to diversify their portfolios, which is important from both the business and the customers’ standpoints.

#3. Secure Blockchain-Based Transactions

Once you’ve decided to develop a crypto application, make sure to prioritize the security of your on-chain transactions and other cost-related operations. The transaction safety measures include but aren’t limited to encrypting sensitive data, verification of user accounts and signatures, and integrations of blockchain security protocol, etc.

#4. Integration with Payment Gateways

This feature enables users to perform the payments directly from their crypto wallets, through the integrated external payment processors or gateways for cryptocurrencies. Crypto-based technologies work similarly to the standard payment processor gateways and acquire bank credit cards and are commonly applied to make transactions more simple without compromising their security.

#5. Efficient Address Management

Powerful address management functionality allows crypto users to ease wallet address tracking and facilitate their identification. However, along with the technical aspects, developers also need to ensure the system provides a convenient design and user-friendly experience for managing crypto addresses.

#6. Integrations with the Paper Wallets

Importing paper wallets allows crypto holders to transfer funds between a physical paper wallet and the digital crypto wallet app. Yet, similarly to the crypto exchange security features, paper wallet integration should be handled carefully due to its high relevance to sensitive user information and financial data.

#7. QR Code Scanning

This function is mainly used to simplify the process of sending and receiving cryptocurrencies. Users can scan QR codes to input wallet addresses, conduct transactions, or log in to their crypto wallets through any mobile or desktop device. The QR code scanning integration is relatively straightforward and features plenty of established libraries and APIs available for developers.

#8. Automated Session Logout

This functionality can provide the add-on security layer for your digital wallet app, ensuring they’re safe and can be accessed only by authorized parties with specific permissions. Once the session is ended, the system will automatically log you out, confirming the safety of the in-app processes and crypto manipulations.

Got lost in tech details?

8 Steps for Developing a Cryptocurrency Wallet App

Now we would like to describe the basic steps for creating a crypto wallet app and give best practices for each step based on your experience.

1. Review the Latest Blockchain and Cryptocurrency Concepts

Keep track of the latest trends and technology updates in the blockchain and crypto landscape. This knowledge will provide a solid foundation during the actual development process. Revise the current Layer-2 solutions as far as they offer higher transaction speed with a relatively low gas fee.

At the current market state, we recommend turning your attention to Solana due to its ecosystem prominent growth and Polygon, due to the fastest implementation of the ERC-4337 token standard. This new level of technology allows for building a programmable wallets with smoother transaction flow and higher level of security at the same time.
Herman Stogniiev, Co-founder and CTO at IdeaSoft

Understanding the fundamentals of blockchain architecture, different consensus mechanisms, and the specific features of cryptocurrencies will help you maximize the performance of your project, ensuring its competitiveness in the long run.

2. Utilize Established Open-source Cryptocurrency Libraries

Leverage well-maintained, open-source cryptocurrency libraries like BitcoinJ for Bitcoin or Web3.js for Ethereum. These libraries have been extensively tested for blockchain-based product development and can significantly enhance the development workflow while ensuring reliable functionality and keeping your products secured.

3. Leverage APIs for Seamless Integration

Utilize reputable APIs provided by blockchain networks, which can provide high-level reliability and development support. These APIs offer standardized methods to interact with the blockchain, making the integration process smoother and more efficient.

4. Harness Cloud Technology for Scalability

By utilizing cloud platforms like AWS, Google Cloud, or Azure build a scalable crypto web app that always provides top-level user experiences. Additionally, leveraging the cloud solutions in crypto wallet applications enables businesses to effectively allocate computation resources based on user demand, providing a seamless performance even during peak usage.

5. Choose an Appropriate Technology Stack & Development Expertise

Select a technology stack and blockchain expertise that aligns with your project’s requirements and business goals. For instance, consider using languages like JavaScript (for web-based wallets) or Java/Kotlin (for mobile apps on Android or iOS). By choosing the databases, frameworks, and libraries that work best on the target operational system and device, you can provide the smooth and efficient performance of your crypto wallet app.

6. Strengthen Security Measures

As we mentioned earlier, security is the paramount component in cryptocurrency wallet development. Implementing industry-standard security practices like data encryption, secure key management, and secure coding practices can make your product more resistant to hacking attacks, leakages, and other threats. Additionally, secure and reliable systems will help your crypto wallet app gain recognition among larger audiences.

7. Analyze Market Competitors

Conduct thorough market research to understand the strengths and weaknesses of the existing crypto wallets. Identify the key areas where your product can stand out among the competitors with unique features or improvements. Use the results of your research to make data-driven decisions and build a powerful digital wallet for cryptocurrency.

8. Implement & Refine Your Application

After the app release, pay attention to the user feedback and adjust the functionality of your crypto wallet to meet the client’s needs. Continuous refinement and updates based on user input, as well as catching up with the latest industry innovations, will help you to ensure the product’s success from a long-term perspective.

Our Experience in Crypto Wallet Development

At IdeaSoft, our blockchain team features vast expertise in building digital wallet solutions for crypto. For each of the projects, we create a custom development strategy that is fully tailored to your project requirements and business goals.

For example, for one of our recent projects – Dollet Wallet – our experts have built a non-custodial crypto wallet that features seamless asset management and multi-chain compatibility. Along with a functional admin panel, the app streamlines processes for crypto storage, DeFi farming pool investments, and bridge-enabled asset transfer. Finally, this cryptocurrency wallet supports third-party service integration to enable the seamless in-app exchanges of crypto assets.

*Dollet Wallet wireframes featuring a basic wallet functionality*

To maximize the project’s efficiency, our experts have created a data-driven development strategy based on the current market trends and target audience studies, yet included the core business goals and project requirements discussed with our client.

Key Challenges in Cryptocurrency Wallet Development

According to Rostyslav Bortman, the Head of Blockchain at IdeaSoft, the main challenge in crypto wallet development is the security of private key management on a device.

Crypto wallets utilize the device memory for private key storage, so developers must analyze the architecture and technical specifications of the hardware when building cryptocurrency wallet apps.

Along with the private key management, other important aspects in creating digital wallet apps include the app’s UI/UX design, its scalability, and blockchain development expertise.

UI/UX Design. In the challenging landscape of Web 3.0 development, ensuring an outstanding user experience and seamless functionality can give you a serious advantage over the competitors. With an expert UI/UX team, you can create a user-friendly interface that ensures a seamless engagement with the key wallet services and functionality.
App Scalability. As the user base and transaction volumes grow, you may need to scale your project to optimize its performance for larger traffic flow. So, once you decide to build a cryptocurrency wallet, make sure to consider its future development and growth strategy as well. Considering the scalability of your digital crypto wallet will help to optimize your application, extend its functionality, and integrate the newest technologies, which benefit both the client experience and the business as a whole.
Blockchain Development Team. The development expertise is an essential component of your project’s success. For this reason, it’s important to hire specialists who are relevant to your project requirements and business goals. Additionally, it’s recommended to check the developers’ experience and discuss your expectations to ensure a productive and efficient collaboration.
Regulatory and Legal Challenges. Adhering to evolving regulatory frameworks and legal requirements is crucial for your crypto wallet app development. Compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations can be particularly challenging, as these requirements vary across jurisdictions and are subject to change.
App Security and Safeguarding Measures. The cryptocurrency space is a prime target for hackers, and wallet developers must continuously adapt to evolving security threats. Our team always recommends implementing advanced encryption, and multi-signature authentication, and conducting regular security audits after each smart contract or even wallet software update.

When developing a cryptocurrency wallet, it’s also recommended to consider the right wallet type, including multi-currency support and specific in-app functionalities, which can enhance the app’s usability and facilitate user experience.

How much does it cost to develop a crypto wallet app?

The cost of cryptocurrency wallet application development is influenced by the desired feature set, complexity, chosen platform, and the location of the development team. For a basic wallet with features like storing a few cryptocurrencies and basic send/receive functionality, the estimated cost range is between $30,000 and $40,000. This is suitable for individuals or startups looking for a simple solution.

We always recommend our clients to start with a discovery phase, where we properly draw up requirements for the project and make proper estimates.

For a more moderate wallet that includes additional features like supporting a variety of cryptocurrencies and basic trading capabilities, the estimated cost increases to $50,000 – $80,000. For those seeking an advanced cryptocurrency wallet with features such as staking, DeFi integration, and an in-app exchange, the estimated cost may rise to $100,000 – $200,000.

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This complexity level often demands the expertise of a full-cycle development team, such as IdeaSoft, which is capable of handling intricate functionalities and both iOS and Android platforms. The investment reflects the comprehensive nature of the features and the need for a more extensive and blockchain-specialized development team.

Summary

Choosing the right functionality, efficient strategy, and relevant expertise is essential for building a successful crypto wallet application. And, having uncovered the essentials of how to create a cryptocurrency wallet for your business, it’s the best time to get started on your project development with the professional blockchain team.

IdeaSoft is one of the leading blockchain companies with proven expertise in crypto app solutions development. Our team of dedicated blockchain developers, creative designers, professional project managers, and experienced business administrators will guide you through each stage of the project delivery, helping you to build the most efficient and effective solution for your company.

Incorporating restaking features can further enhance your wallet app by providing additional rewards and incentives for users. Contact us today to discuss how to create a crypto wallet app that empowers your business development and growth!

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Introduction to ReFi: What Is Regenerative Finance?

Conceptual Framework of Regenerative Finance (ReFi)

Technological Underpinnings of Regenerative Finance (ReFi)

How is ReFi Different From DeFi?

ReFi Case Study: Toucan Protocol

Element 1: Toucan Carbon Bridge

Element 2: Toucan Carbon Token (TCO2)

Element 3: Toucan Carbon Pool

Future Applications of Regenerative Finance (ReFi)

Summary

Conceptual Understanding of DePIN

How does DePIN work?

Physical Resource Networks vs. Digital Resource Networks

How DePINs Transform Web3

Examples of DePIN Projects

Filecoin & Arweave – The Leaders in Decentralized Storage

Helium – Leading the Way in Decentralized Wireless Networking

Render Network – The Rising Star of Decentralized Computing

Theta Network – The Innovator of Decentralized Streaming Media

Future DePIN Applications

Summary

Understanding Sharding in Blockchain

Sharding Work Principle

What problems can be solved with sharding?

Private Shards: Concept and Purpose

Technical Implementation of Private Shards

Real-World Examples

Summary

What is DeFi?

Advantages of DeFi

Limitation of DeFi

What is CeFi?

Advantages of CeFi

Limitation of CeFi

DeFi and CeFi Benefits and Limitations Comparison Table

Creating a Hybrid DeFi with CeFi Platform

Embracing the Best of Both Worlds

Overcoming the Challenges

User Education and Risk Management

The Future of DeFi and CeFi

Summary

What Is Digital Identity?

Digital ID Limitations

Benefits of Blockchain Identity Management Solutions

Developing a Blockchain-Based Identity Management System: Main Steps

Project Scoping and Stakeholder Expectation Management

Choosing the Right Blockchain Platform

Polygon Supernets

Avalanche Subnet

NEAR Nightshade

Designing the Identity Management System

Testing and Deployment

Ongoing Maintenance and Support

Summary

5 Recommendations on How to Create Stunning Visuals for Your Crypto Wallet UI

Step 1. Analyze end-user needs and competitors

Step 2. Provide data visualization when creating a crypto wallet UI

Step 3. Make a crypto app easy to use

Step 4. Educate users and explain crypto benefits

Step 5. Design for trust and security

Why develop a custom crypto wallet UI/UX design?

Crypto Wallets UI/UX Case Studies

Why choose IdeaSoft for crypto wallet UI design?

Summary

What is an Algorithmic Stablecoin?

Benefits and Challenges of Algorithmic Stablecoins

How to Develop an Algorithmic Stablecoin? Step-by-Step Guide

Identify the blockchain platform you need

Consider the maintenance of liquidity

Develop a smart contract

Smart contract testing