The development of decentralized apps is a multi-stage process that demands careful planning and review of various factors, picking the right technologies for a given task, efficient performance of the different milestones on a project roadmap, extensive testing, and quality assurance period, and so on. But before you build a DeFi app, you need to know some things about it. DeFi app development obviously requires a few things and main stages.
In this article, we will go through the main stages of knowing how to build a DeFi app.
What is DeFi app development?
Before you learn how to make a DeFi app, you need to know what that is. Decentralized finance removes the middlemen from decentralized business models and, thus, cuts out any unnecessary costs — such as hefty cryptocurrency exchange fees — that are later passed on to the consumer. DeFi applications give users control over their money through smart contracts and atomic swaps that keep their assets within reach at all times while also allowing them to continue tracking and eyeing their finances.
Benefits of DeFi apps
Well, if you want to create a DeFi app, you need to know what DeFi apps can deliver. Let’s see if DeFi application development is part of those benefits.
Easy access to financial markets
Decentralized finance (DeFi) is the new way of making low-friction, secure, and totally decentralized transfers. Unlike traditional financial institutions, where you have to wait days for your bank transfer to go through and are charged really high rates on your monthly borrowings, decentralized finance has a better system in place. With smart contracts handling every transaction and no one having any say in who can participate, it’s easy to use and extremely fast.
DeFi grants transparency
DeFi protocol gives users access to previously untapped levels of transparency and openness in traditional financial transactions. The blockchain is able to provide complete auditing capabilities, significantly reducing the risk of dishonesty or mismanagement within a business model.
Types of DeFi app
There are currently a wide variety of DeFi apps available on the market. Let’s take a look at some of the most popular ones.
Lending and borrowing
This past year, the on-demand lending space has been growing. Many companies are creating tech and platforms to enable peer-to-peer (P2P) borrowing.
The crypto-blockchain and distributed ledger space are decentralized by nature, but it’s highly derivative. In other words, projects are built on the innovations of previous platforms. DeFi apps are great for insurance for that reason.
Decentralized Exchanges (DEX’s)
Decentralized exchanges are the future of crypto trading. With so many centralized exchanges getting attacked and running into problems, it’s only a matter of time before decentralized exchanges become the norm. Nowadays, they’re still in their infancy, but things are moving faster than we expected.
Main stages to build a DeFi app
Stage 1: Plan your DeFi app
The first step is to decide the type of DeFi application you want to build. This can be done by looking at the various use cases of decentralized finance and answering a few questions: Will it help people get access to cryptocurrencies? Can my app offer people different ways of investing their crypto assets?
Step 2: Find applications of the technology
Many companies are exploring the ways in which it can be implemented to improve security and existing business models. As it is new, there is a steep learning curve involved.
Step 3: Hire your DeFi team
You need to find expert blockchain developers to build your DeFi app. They should have a deep understanding of the technology and how it can be applied to create innovative applications. By working with experienced developers, you can be sure that your project will be a success.
Step 4: Don’t forget UX
User experience (UX) and user interface (UI) design are critical for DeFi apps. Good UX/UI can make your app more attractive to users and encourage them to start using it.
There are lots of things to take into account before you build a DeFi app – you should think about the design, create the infrastructure, and go over the whole idea. Still, you should be aware that DeFi app development is no joke, and you should take it seriously if you’re to proceed.