The truth about building your own crypto integrations
Let's face it. Building crypto integrations in-house sucks. There is so much more you could be focusing on, like... you guessed it... your actual product and the value it provides your customers. In the end, building and maintaining your own crypto integrations do not scale well, and the operational burden that comes along with that makes it worse.
Eventually, you'll need to scale a team dedicated to keeping these integrations alive, which can be expensive. Oh, and the data that you get access to? Most of it needs to be sanitized when you get it. For most, it's like reading hieroglyphics. All this results in lost time, money, and resources that could have been working on your core product, improving the user experience and value that results from it.
You may ask, "Well, how many resources, hours, and dollar bills does it take to build and manage your own integrations in-house?". "It can't be that expensive, can it?". Let's walk through what it takes to build a highly reliable, accounting-grade crypto integration truly takes to develop and maintain. In this sense, accounting grade means data ready to power financial grade applications like accounting platforms, tax platforms, wealth management platforms, etc.
Let's dive in
For some context, we are looking at this process through our own experience as founders, building our first product Luumen Finance along with customer experiences. The following assumes you have a blockchain engineer or someone of similar experience in the space who understands the data and has experience dealing with complex APIs.
We found that the average time it took to build an initial version of a production-ready crypto integration averaged around ~50 hours. This assumed that infrastructure was already deployed, security was in place, a UI existed, data security was set up, and so forth. For example, some integrations took longer than 50 hours with exchanges, while others took less time.
For example, you could get an Ethereum integration setup faster by using a block explorer API, but eventually, as your scale, you would need to pay a premium to use that API which can become costly. When you add additional EVM-based changes, those that cost and API complexity build-up. This is something that will not be scalable and will become a nightmare to manage. Eventually, you'll want your own node infrastructure and have to refactor your endpoints to get off these integrations.
By the way, when you move off those expensive blockchain explorers onto your own nodes, you'll need to build an indexer to access that data. Remember, you'll need to create the proper infrastructure to house the indexed data you retrieve from the nodes, which will take additional time, money, and technical know-how. There are services you can use to do the indexing and have an API to access that data, but you guessed it, those come with a cost as well, and it isn't cheap. These are just some things they don't tell you in the "build your own crypto integrations" manual that most people find out the hard way.
Now that we got our initial crypto integration up and running let's throw in an additional 100 to 200 hours of maintenance and improvements per year on each integration you build. Downstream APIs change without notice, data inconsistencies, break fixes, and you'll want to expand your existing integration set to support additional exchange services like staking, margin trades, and so forth. These are some hidden costs of building your own crypto integrations that no one wants to discuss. As your integrations expand and scale, so will your infrastructure and need for improved security, compliance, and monitoring on these endpoints to ensure things are running smoothly. Your users always have access to their data.
We can't forget rate-limiting tuning to ensure all your users can sync their data freely without your API keeling over with requests or the downstream services blocking you. You don't want your customers kicking down your support team's door because they suddenly can't sync their account data during tax season.
Now that you got that all out of the way, let's that bill for the crypto market data you'll need access to enrich the data you've pulled from the exchange and blockchains. That'll be 10k to 100k per year, depending on the service you use and the granularity you require for your application. This is not optional, by the way; this is a requirement if you are building a financial service or fintech application where fiat equivalent data accuracy is required.
Last but not least, the average salary for a blockchain engineer is around 150k USD per year. Eventually, you'll need a team of blockchain engineers to scale your integrations. This does not include the cost of the SRE engineers, who will need to be on-call all the time to make sure all of your integrations are continuously up and running.
Let's face it, as awesome and fun as it is to build your own crypto integrations in-house, its economies of scale only pay off in the short run. Eventually, the burden catches up. You're looking at hundreds, if not thousands, of hours building out integrations and hundreds of thousands of dollars in additional costs to architect, maintain, and service these integrations.
OR… you can integrate Hatchfi API in minutes and get instant access to your users' crypto account and financial data from over 280 crypto exchanges, wallets, and blockchain protocols. We built our crypto integration platform with security and reliability in mind so that builders in the crypto and web3 space can focus on making amazing products and less on maintaining the plumbing that powers their platforms.
Hatchfi is a SOC2-compliant crypto integration platform & API that securely connects users' crypto accounts to any app as they would connect to an online bank account. Built by developers for developers, Hatchfi brings the highest quality human readable data with seamless integrations together, making it possible to create crypto-powered fintech apps in an afternoon instead of months. Hatchfi's mission is to bridge Web 2 and Web 3, unlocking the benefits of financial tooling for communities globally. Founded in 2022 by Carlos Feliciano and Casey Wilcox, Hatchfi is headquartered in San Francisco.