A decentralized future awaits us. Of course, we should not forget that it is not beneficial to everyone, but the trend toward decentralization is gaining momentum. Getting rid of centralization has become a powerful trend and has greatly simplified work in many industries. Creating a dApp requires deep knowledge in technology, finance and business analysis. If you have a need for a DeFi app and are looking for an experienced company to develop it, the ARTJOKER’s team is ready to do it for you.
What is a DeFi App?
DeFi App is a software application that runs on blockchain. Unlike Internet applications, it does not need a centralized database to run. If you want to create decentralized applications or improve your customers' data protection with cryptography, the open-source Ethereum development blockchain platform is perfect for that. DeFi App runs on Ethereum, but also on other blockchains that can run smart contracts, such as EOS and TRON. If you want to know about DeFi trends in 2022, note that in the future there will be the creation of untethered stablecoins, the value of which will not depend on fiat, DAI will remain the main decentralized stablecoin on Ethereum, while UST will develop the ecosystem on different blockchains.
Blockchain development has so far been most commonly applied to financial transactions, cybersecurity technologies, and user identification, but the technology is not limited to these areas. Decentralized Finance applications perform the same functions as traditional financial institutions (banks, transfer systems, exchange offices, credit centers). But each member of the community simultaneously acts as an entity processing other customers' transactions.
Types of DeFi Applications
Just like how there exists many different use cases of decentralized applications, there too exists many different types of DeFi applications. Decide what type of app you want to offer your users: Payment, DEX, Lending, Asset, Derivative or NFT.
The process of creating decentralized applications is not as simple as developing any centralized application or software. You need to be careful at every stage of development. It has its sequential steps and timelines. As blockchain services and platforms gain momentum, decentralized applications (dApps) are sure to become increasingly popular in the coming years. More and more companies and developers are seeking to use these technologies to interact with customers through a decentralized network. As you can see there are many different types of DeFi projects.
"The Decentralization of Finance is really good for humanity and it's ultimately a win for each and every one of us. Because now that we can circumvent banks, exchanges and brokerage companies by using smart contracts on the blockchain? every person, every family, and every business will experience more liberty, more freedom, more opportunities, more abundance, more power, and more wealth." ― Hendrith Vanlon Smith Jr
Be sure to thoroughly research ideas about what your competitors are creating, what DeFi features are prevalent, and what fits your business.
Assemble a Team to Create a DeFi Application
If you are interested in truly high-quality dApp development, you need to assemble an experienced and professional team with a wide range of skills and extensive knowledge of financial and blockchain technology 🤓. If you want to create a quality DeFi app, you can't do without an experienced development team.
Without a talented and experienced development team, it is unfortunately impossible to create a reliable, high-quality and safe product. In addition to developers who know how to build a DeFi app, your team should include a capable project manager to efficiently organize all workflows and a testing team to help ensure top-notch quality control.
Here is a short list of key knowledge and qualities that the ideal team should have:
- In-depth experience in blockchain and cryptocurrencies;
- List of successfully created and launched blockchain projects;
- In-depth knowledge and experience in smart contract development;
- Experience with FinTech projects;
- Understanding of security standards such as CryptoCurrency Security Standard;
- Expertise in security and penetration testing.
UX/UI Design for DeFi App
If you want your future app interface to be user-friendly, easy to use, intuitive and attractive, as well as give your business a personality and retain app users, then you need to engage experienced and professional UX/UI DeFi design developers. Using a research-based, user-centric approach, the experienced team will develop an interface that will help your dApp provide a seamless user experience.
When creating a DeFi app, UI/UX design is one of the important parts of development. It doesn't matter if you outsource the design, or if you assemble your own team, the most important thing is that this team can offer a comprehensive solution, and work with the application from start to finish.
The most important thing when designing the interface is to make it as easy as possible for users to interact with DeFi protocols. There is no point in laying down functionality that will end up being complicated and confusing. To make an application enjoyable for users, you need to implement the functions in a user-friendly interface, and only an experienced UX/UI team can do this.
Install Truffle and Ganache
Truffle is a development environment that provides tools that make creating an application much easier. To install it from the command line, you need NodeJS and the Node Package Manager (npm). One incredibly useful feature of Truffle is that they offer a complete set of "boxes" to get you started quickly. Essentially, they are templates that include useful modules, ready-made smart contracts, interface views, and more.
Next, you need to install Ganache. Ganache is the programmable first blockchain simulator for developers. Ganache allows developers to quickly reproduce their smart contracts, instantly processing transactions and providing quick feedback on how their application is performing. Ganache speeds up automated testing, development and debugging of blockchain applications, and it's portable. Having an easy-to-use sandbox allows developers to focus solely on their applications without wasting time building their environment.
Create and Compile an ERC20 Token
Despite the fact that most dApps are built on the Ethereum blockchain, these applications can also be based on various other blockchain platforms, such as: Hyperledger, Polkadot, EOS and others. In this section you will learn about all stages of DeFi token development.
In simple terms, Hyperledger is a kind of a hub for open development of industry blockchains. The Linux Foundation wants to completely change the concept of transactional applications, making them not only more powerful, but also more transparent.
In fact, ERC20 tokens are quite common around the world. Among the most famous currencies that use the ERC20 standard are: Chainlink, Tether, Shiba Inu, Wrapped Bitcoin and OmiseGo.
Now, our DeFi solutions team will show you how to create ERC20 token step by step. To create an ERC20 token, you need to go through the following steps:
- Set token events. It is a known fact that contract calls cannot directly return a value when sending a transaction. Events can be used to send signals about events that have occurred, such as a transaction, transfer approval, or any other data transfer. With the ERC20 Generator, you can generate events to communicate with the blockchain. Declare the events inside your contract;
- Then, set the name, symbol and decimal of the token. Before proceeding to the next steps, note that there is no central token registry. This means that the uniqueness of a particular symbol, or name, cannot be guaranteed;
- Now, you need to set up a map of balances and allowances;
- Your next task is to declare the total supply, to store the number of ERC20 coin tokens. When a predetermined limit is reached, the smart contract will stop creating new tokens;
- Finally, you need to get the owner's balance.
Deploy the ERC20 Token
It's time to deploy our token. After deployment, our token will be distributed to all nodes that participate in the network. If you are interested in ERC20 token features, you should know that the most important feature of the ERC-20 token is that it is secured by smart contracts. All changes to the token will be distributed to all participating nodes. To deploy your ERC20 token, there certain steps to be followed:
- First, you need to compile a smart contract;
- Then, install the Metamask extension and create an account;
- Deploy the smart contract on the network;
- Enter the desired number of tokens to be traded;
- Be sure to check the balance of the deploying address;
- In case a value of 100 is returned, the token has been successfully deployed, in the opposite case, you have made a mistake somewhere.
Creating the Farm Token Smart Contract
Generally speaking, you have two options for creating tokens. The first option is to issue a new token in the Ethereum ecosystem. The second option, mining tokens to an existing ERC20 compatible contract such as a farm token. With a farm token, you can create an ERC20 token without much trouble. Unlike centralized applications, dApps connect users and developers directly, without involving an intermediary.
The farm token includes a smart contract template that is deployed on the Ethereum network. The initial template consists of farmcoin and farmercoin, however, you can remove it and add your own token with no problem. DeFi apps on Ethereum blockchain stores transaction history and account status.
Make Sure the Application has Strong Security Features
It does not matter whether the Defi Mobile app, or the desktop app was developed, first and foremost, conduct a smart contract audit to identify any vulnerabilities.
Eliminate centralization issues in the code, if any, as this is one of the main sources of attacks today. Perform penetration testing . Attack simulations should be performed in order to identify any vulnerabilities. If you find potential attack vectors, hidden vulnerabilities, or node vulnerabilities, these must all be addressed and your application's defenses strengthened. Don't forget about protecting wallets. Take care to properly manage and protect private keys. The use of cryptography to verify user identity is recommended.
When testing DeFi app, you should conduct an extensive security review of your smart contract and blockchain code, the main purpose of this review is to identify all vulnerabilities and fix them.
Finally, make sure that user data is private and completely secure. Confidential user data should be stored locally. Don't forget about possible data leakage, when uploading files to cloud data storage, so make sure you don't include information that could be extremely damaging to your company.
DeFi App Testing
Once you have implemented all the basic features, it's time to test your DeFi application 😎. This involves checking the code for usability and functionality, as well as testing the system under all possible load scenarios. In addition, you must also make sure that all of your smart contracts are working properly and do not contain "holes" for stealing money and sensitive user data.
Internal testing is not enough here. You also need to have smart contracts independently audited. To avoid losing money through smart contract hacks, take the DeFi app testing seriously.
The Cost of Creating a DeFi Application
After reading the theoretical part of this article, you may be wondering, how much does it cost to build a DeFi app? Well, everything here is very variable, depending on the type of application, size and experience of the team, business purpose, blockchain technology, and other factors.
If we take the general values, the cost of the application can vary from $65,000 to $270,000. But this is only a very rough estimate of the cost of your future dApp.
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