What if you could have virtual money in real life? No, we are not talking about science fiction. With Bitcoin, you can have real-life virtual money and you can use it to buy things as well.
But Bitcoin is not a form of physical money. It is virtual, which means it is there, but not also there. So how do you store a currency that is there but not there, at the same time?
Simple, through Bitcoin wallet apps. With a Bitcoin wallet app, you can send and receive Bitcoins easily. Bitcoins wallet apps are famous for being private, secure and anonymous.
With that being said, the question you must be asking now is how to make a Bitcoin wallet app?
We will tell you about it, but before we dive deep into the world of Bitcoin wallet app development, let’s take a brief look at what is Blockchain and Bitcoin.
How To Make A Bitcoin Wallet App: The Crucial Steps
Initially, it might seem hard, but with the following steps, it’s going to be really easy to build a bitcoin wallet app.
1. The World of Blockchain and Bitcoin Explained
In a very basic sense, a Blockchain is a “chain of blocks” where the “blocks” are digital information or transaction data and “chain” is the cryptographic principle used to connect the blocks.
A Blockchain system is a decentralized one. What does it mean? Well, it means that there is no central figure to this system. There are no banks and government peering into your transactions to see what you are doing. The information is stored in ledgers that are stored in numerous computers, spread across the world.
The fun thing about Blockchain is that the data entered in a block is immutable, meaning it cannot be changed. And every block contains a special ‘Hash’ that is unique to each block. This ‘Hash’ comes in handy when you have to find a specific block.
The very first Blockchain was created for the online cryptocurrency Bitcoin, by Satoshi Nakatomi in 2009. Earlier, blockchains were mainly used for cryptocurrency transactions. But now they are being used for all kinds of industries. Some of the famous blockchains are Bitcoin, Ethereum, Ripple, etc.
A Blockchain can be of two kinds- a public/permissionless blockchain, and a private/permission-based blockchain. Since we are going to talk about Bitcoin wallets, we will only be concerning ourselves with public blockchains.
Now, What Is Bitcoin?
In simplest of language, Bitcoin is a kind of digital currency that only exists electronically. With Bitcoin, you can make a transaction to and from a 16 character long encrypted address. It was released as an open source software way back in 2009, by Satoshi Nakatomi, though the identity of the person is unverified.
Being decentralized, there are no central figures of authority like bank or government controlling the amount of Bitcoin in circulation. Bitcoin holders transfer Bitcoin via a Peer-to-peer network, and these transactions are added to the Blockchain as they appear.
Now there are three basic questions people have when it comes to Bitcoin.
- One, how to get Bitcoins?
- Two, where to store the Bitcoins?
- And three, how to transact using Bitcoins?
To answer the first question, you can get Bitcoin an a number of ways. You can buy Bitcoins from online traders, or you can ‘Mine’ them.
2. How Does Bitcoin Wallet work?
When you are thinking about how to make a bitcoin wallet app, you also have to know how it works.
A Bitcoin wallet transaction is based on asymmetric key cryptography that uses two types of keys mentioned before- the public key and the private key.
When someone is sending Bitcoin to one wallet address from their own, they are signing off the ownership of the coins to the receiver’s wallet address. The transaction is stored as a transaction record on the Bitcoin Blockchain and the balance changes will occur on the respective Bitcoin wallets.
Let’s look at an example of a Bitcoin transaction using a wallet app to understand the workings of a Bitcoin wallet app better.
Let’s say that Genny wants to buy a really cute shirt from Bitshirts, a store accepting Bitcoin payments. Genny would have to use her Bitcoin wallet to pay for the shirt.
Her Bitcoin wallet contains a collection of Bitcoin addresses and private keys. The Bitcoin address is made up of 32 characters of numbers and letters of the upper and lower case. The private key is a key made up of 64 characters. The private key is important because it will prove that Genny owns the address and lets her allow to signal the network that she is going to send Bitcoins to a new address.
Now, to start the transaction process, Genny simply has to log into the wallet app using her phone. To send money, she would receive the public address of Bitshirts, maybe in the form of a QR code. Once she has the public address, she can simply enter the amount of Bitcoin she has to pay and send it to Bitshirts.
This transaction would be then sent to the miners, who would verify the transaction and add it as a block on the blockchain. Once the transaction is confirmed, Genny would have successfully sent money to Bitshirts, and get that really cute shirt she loved!
3. The Types Of Wallets You Should Know About
The Bitcoin wallets can be divided into a few types. These are-
A. Desktop Wallet
The desktop wallets are basically wallet software that is downloaded and installed on a PC or laptop. They are only accessible from the device. But if your computer gets infected with a virus, gets hacked or experiences external damages, you can lose all your funds.
B. Mobile Wallet
Mobile wallets are apps that are installed on mobile. These wallets are very handy as they can be used even in offline stores as a means of payment. These are considered safer than cloud wallets. The only problem that mobile wallets face is that you may lose your asset if you lose your phone or it suffers some kind of damage.
C. Paper Wallet
Paper wallets are the physical copy of your generated public and private keys. It can be printed on a piece of paper or etched on a metal plate. Paper wallets are by far the safest of all kinds of Bitcoin wallets. You can easily send funds by transferring the money to wallets public address and you can also withdraw Bitcoin by either entering the private keys or by scanning the QR code on the paper wallet.
D. Hardware Wallet
Hardware wallets are gadgets, often USB drives that store the user’s private keys. They can be used to make online transactions as well, though most of the time they are offline. These wallets are convenient because of their ability to perform transactions easily. You can just plug them into the internet and authorize yourself to perform the transaction. This is why even though it is expensive, hardware wallets are still the best and safest options of a Bitcoin wallet.
E. Online Wallet
Online wallets run on the cloud, and they can be accessed from any device with an internet connection. They are practical and convenient, but they are also very unsafe. Online wallet services have an extensive history of scams, which is why you need to be careful before choosing an online Bitcoin wallet service.
The above-mentioned types are based on the forms of the Bitcoin wallet. However, based on online connectivity and security, there are three types of Bitcoin wallets.
E. Hot Wallet
Hot wallets are the most common type of Bitcoin wallet. ‘Hot wallet’ simply means a wallet that is always connected to the internet. This kind of wallet is the most convenient because you can just send or receive Bitcoins through this wallet without any hassle.
However, this is also the least secure kind of wallet. Due to being connected online all the time, it is easier to attack, by using malware that drains hot wallet online.
Cold storage or a cold wallet is the exact opposite of a hot wallet. A cold wallet is not connected to the internet and therefore is more secure and safe for your Bitcoin assets. The most popular forms of cold wallets are paper wallets and hardware wallets.
A cold storage stores your public and private keys. And even though they are kept in a safe and secure location, they will still receive funds that are sent to them.
A warm wallet, just like the name is somewhere in between cold and hot wallet. A warm wallet combined the security features of a cold wallet along with the easy transaction methods of a hot wallet.
A common type of warm wallet is a hardware wallet. It is a dedicated device that generates keys and signs transactions, broadcasting them to the network via an internet connection. A disconnected warm wallet functions as a cold wallet. But when you connect the internet, it works as a hot wallet. But has better security than an actual hot wallet, because the private key is not revealed to the host system.
4. Essential Features to Make A Bitcoin Wallet App?
Before we get into the details about how to create a Bitcoin wallet app, let us tell you in brief about the factors you should consider:
- The authorization: sign up and login feature to access the Bitcoin wallet
- Profile page: easily transact using Bitcoin, to check the balance
- Security: setting up a password and pin code for the app protection
- Push notification: for transactions, change in Bitcoin market price, etc.
- QR code scanner: to easily send and receive money
- Trading service: to find Bitcoin sellers and work as a seller
- The exchange rate: easy monitoring of Bitcoin price
There are a couple of things that are going to fall under the process of building a Bitcoin wallet. All of these are equally important so you need to pay an equal amount of care for each of these points.
The Important Bitcoin Wallet App Features Explained
Before we begin talking about how to create a bitcoin wallet app, let’s talk about the features. To make a perfect Bitcoin wallet app, you need some necessary and some additional features to it. And these are-
A. Authorization Feature
The authorization feature aka the login and sign up feature is quite familiar for us. We use it in almost all the apps today.
For the Bitcoin wallet app, it is important to have an authorization feature to authorize the person who is logging into the wallet app. This is a layer of security that needs to be present in your app.
However, you have to make the procedure as easy and seamless as possible. This is the first feature the user will interact with on your app, so make sure it doesn’t put them off of the app.
B. Added Securities
The security is of the utmost importance when you create a bitcoin wallet app.
The cool features and amazing UI/UX is not going to help your app if it doesn’t have proper security to it. Even if your app is the best of all the aspects, just one attempt at hacking is going to make sure that people stop using your app.
Without security, the data of your user base is prone to stolen and exposed, causing the reveal of their identity and destroying their anonymity.
We will talk more about more security features later on. For now, let’s move onto the next feature that is obviously the wallet feature.
Since we are building a Bitcoin wallet app, it is obvious that we have the wallet feature integrated to it.
Integrating a wallet feature will allow the users to buy or sell Bitcoin from sellers, or sell Bitcoins themselves.
See what their current balance is and also the transaction history.
And last but not least, send and receive Bitcoins from other people. The wallet feature is the central feature of your Bitcoin wallet app. You can’t even think about how to make your own bitcoin wallet app, without considering the wallet feature.
D. Conversion Rates
The market price for Bitcoins changes every day. And it is important to keep up with the changing prices for those who invest in Bitcoins.
Within hours a lucrative investment on Bitcoins can become absolutely unprofitable. Which is why you need to incorporate the feature of displaying the exchange rates to your users.
This way they will be able to keep up with the ever-changing market rates and invest their money in the right way.
You can also integrate the feature of suggestions, that show the user how the exchange rate for Bitcoin has changed within hours and since yesterday. It can also give them a notification when it is a favorable time to exchange the Bitcoins.
E. QR Codes For Fast Transactions
Using QR codes make the transaction faster and easier., this is a universal truth.
You can create an app without the QR code scanner, but it will be more useful for the users if your Bitcoin wallet app has a scanner.
This way the users don’t have to type a long key to send money. All they have to do is just to scan a QR code and the Bitcoins will be on their way to the receiver. There are no chances of making a typo with this, so there is no way for the Bitcoins to end up with the wrong receiver.
F. Address Books
This is another feature that is going to increase the ease of sending and receiving Bitcoins for the users. The address book feature contains the most used addresses where you send Bitcoins. This is a useful feature for when you create a bitcoin wallet for business transactions.
G. Merchant Services
With this feature, the users are going to be able to use the Bitcoins stored into the wallet.
This is a feature that you should definitely add to your app. With the built-in retails services, the users can use their Bitcoins to make their purchases and access online stores. This way they will end up using your app on a daily basis
To rightly use this feature to your app you have to give the users a list of all the stores and services that accept Bitcoins. This along with a map service, you can give them information about places near them that accept Bitcoins.
H. Push Notifications
It is important to keep the users of the app notified about all the important things, such as conversion rates, transaction histories, new payments, accepted payments, and important updates.
The perfect way to deal with this is with push-notifications. This is not only going to keep the users updated with the latest information but keep them more engaged with your app.
But push-notification is a double-edged sword. Too many notifications can annoy them, so give them an option to time the notifications right. This way they will receive notifications on a fixed time.
5. What Tech Stack You Need To Create Bitcoin Wallet App?
Now that we have talked about the features you need to integrate when you create a bitcoin wallet, it’s time to talk about the technical side of how to make a bitcoin wallet app.
If you are building a web application for the Bitcoin wallet, you should use Angular JS 4.0 and above to build the front-end, along with HTML5 and CSS3. To build the backend use Node JS, and to set up the server, you can use AWS.
- For the Android app, you’ll need Java to build the frontend, and API services using Node JS/Python for the backend.
- For iOS, you can choose Swift for the frontend and the backend, similar to the Android app, using Node JS/Python.
However, if building an app from scratch is not something you want to do, then you can easily use the public libraries available online to create your app.
These libraries will implement the standard functionalities on your app and synchronize it with the blockchain. Some of the great examples of public libraries are Chain-Java and BitcoinJ.
Another advantage of using BitcoinJ is the SPV mode, with which you can download and work with only a few blocks from the Blockchain. You can save a lot of space on your server with this.
With Blockchain.Info, the developers will have a full stack of APIs. it’ll give them the opportunity to integrate the main functionality and features of the Bitcoin wallet app such as creating a wallet, handling payments, etc.
You can also use the Coinbase SDK for the Backend to create the Bitcoin wallet. There are official libraries available for Java, Python and other programming languages. One of the additional advantages of Coinbase SDK is that it also supports other digital currencies like Ethereum and Litecoin.
6. How to Make Your Wallet App Secure?
The safety of the Bitcoin mobile wallet app depends on the various factors, such as the type of wallet it is, the security features, and the service provider. Online wallets are more prone to risks than offline ones. Online wallets can expose users to the potential threats of hackers and malware, while offline wallets are safe because they simply are not connected to the internet.
Here are a few extra security features you can apply to make your Bitcoin wallet app even more secure:
The Bitcoin wallet app should have a proper backup strategy for their users. This way, even if they have lost their private key associated with their wallets, they can get their transaction details back.
One of the top wallets today, Exodus uses 2 kinds of procedures for the backup feature, the first one is the usage of 12 character passphrase the user needs to put it in a safe deposit box.
The second back up option is the email restore option. when the user creates the wallet account, the Exodus authority sends the backup wallet restoration link with the email.
The two-step authorization makes the Bitcoin wallet app even more secure. With this, the users can add their phone numbers and email IDs to receive authentication messages whenever there is any activity on their wallet. This way they will know if someone has tried to log into their account without their knowledge or not.
Continuous Security Updates
This one is for the maker of the app.
When you make a Bitcoin wallet, you have to make sure that there are regular updates to your app. Through app testing and paying enough attention to the reviews left by the users, you need to identify the bugs and security issues and fix them with new updates regularly.
7. Some Example Of Bitcoin Wallets In The Market
So before you begin on your idea of how to make a Bitcoin wallet app, let’s take a look at a few of the Bitcoin wallet apps that have become quite famous with time among the users.
Coinbase is a US-based exchange that supports Bitcoin, ether and also, your normal US dollars. It has an extensive three-step identity verification process during signup. This gives the users of this app a sense of legitimacy, unlike any other Bitcoin wallet app.
Coinbase is an amazing choice for those who casually dabble in the world of Bitcoins. The built-in wallet support for both Bitcoin and US dollars makes sure that the exchange of Bitcoin to dollars and vice-versa happens almost instantly.
Mycelium is one of the most private and secure Bitcoin wallet apps to date. It uses HD (hierarchical deterministic) seeds to streamline security and transaction speed. This means that if you want to back up your Bitcoins, you have to remember a set of a twelve-word passphrase.
The users don’t go through any extreme identification process like Coinbase, so it is completely. All web-based transactions go through the Tor Network, to hide the location and identity of the user.
Along with giving the users access to Mycelium marketplace where they can buy and sell Bitcoins locally, the wallet app also syncs well with cold wallets like Trezor and Ledger Nano S. simply it is the best choice for those who want to stay anonymous on their Bitcoin wallet app.
Few Last Words
The increasing popularity of Bitcoins has resulted in the rise in the popularity of Bitcoin wallet apps. Which is why, if you have an idea for developing a wallet app, this will be the right time to get cracking.
Just remember, when it comes to an online wallet app, privacy and security are the final words.
So make sure that your app is safe to use and is private. Once you have the security features right, the rest will come along easily, and you will be able to build your perfect Bitcoin wallet app.