What are the benefits of blockchain node providers and what Avivi is ready to offer your business

Right now, you and I are witnessing the rapid development of the blockchain industry, which is acquiring new factors and opportunities every day. Experts predict a market capitalization of $67.4 trillion by 2026, and this is due not only to significant investments, but also to profit from successful blockchain projects. The main factor holding back the pace of development is not so much the lack of skilled developers as the significant capital investment required to support the development and operation of dApps. Let's give the average values to understand the situation:

• Maintenance of a decentralized network node;

• Maintenance of a blockchain test node;

• Server maintenance costs;

• Integration with necessary third-party software, for example AML;

• Investments in development (utility payments, cryptocurrency contribution if proof of capacity is needed , fees for commissions).

At first glance, it may seem that the amount is not so much, compared to other IT projects, in practice, the costs exceed the planned budgets many times over. Let's add here staff salaries, as well as financial risks, which are impossible to predict at all. So, in the end, each new project faces significant costs that must be covered either by own funds or by investments.

Basic development requirements for blockchains

Specific development requirements require constant access to the currently limited infrastructure of decentralized networks . It is easiest to explain this on the example of a full node — the main functional component of any decentralized network. This is where transaction validation, blockchain database synchronization, block verification, and information storage take place. That is why for dApp development it is necessary to have stable, and preferably uninterrupted, access to the blockchain, i.e. nodes. We talked about nodes in more detail in the article “ Running blockchain nodes: theory, features and expertise of the Avivi team ” of the Avivi blog, so now we will simply list the most problematic points:     

• To deploy your own node, significant financial investments are required;

• Node operators must ensure 24/7 access to users and data security;

• For some blockchains, not only the technical compliance of nodes is important, but also the reputation of noderunners.

This is just one, albeit the most glaring, example of barriers for potential blockchain developers and business owners. However, this does not mean that interested people will have to give up their own ideas. After all, even now there are ways to overcome most difficulties at reasonable prices.

Blockchain as a service

Do you cut your hair yourself? Probably no one today would think of taking scissors and a mirror and creating their own hairstyle by themselves, because it is difficult, inconvenient, and, for example, on the back of the head, it is almost impossible. That's why you go to a hairdresser, a professional in his field, who makes your appearance unsurpassed. The same person can color your hair, and if not, a fellow stylist will. This metaphor is necessary to understand a service - work that is done for you, but for your benefit, by other people for a certain reward.

Now, if we transfer this example to the blockchain world, we have the following vision:●    

• Your hairstyle is your blockchain project (dApp, smart contract, etc.);

• Hairdresser or stylist — blockchain providers;

• Scissors, comb, razor, or hair dye — cryptographic APIs or SDKs ( Software Development Kits ), due to which the desired result is achieved;

• A trip to the hairdresser — an order “Blockchain as a service”;

• Payment to masters is a fee for using services.

As of today, the business of many companies is directed at assisting users in the implementation of their own projects in conditions of limited resources. This makes it possible to work with the blockchain at the stage of testnet or mainnet without owning own nodes, does not require staking and other obligations - service providers are responsible for all this. Therefore, you should not worry about complex technical issues and waste time on extraneous factors: choose the functions you need and take care only of your own needs.

The variety of services you can get from blockchain providers is also impressive. Today on the market you can find optimal solutions for beginners, comprehensive packages of services for businesses of various scales, specialized solutions, say for DeFi or NFT, universal tool sets or highly specialized solutions for a specific blockchain and much more, for example:●  

• Receiving unified data from the blockchain via REST API;

• Notification of events in the blockchain;

• Compatibility of several public and private blockchains;

• Access to a public or private node;

• Open source key management;

• Data processing from crypto exchanges;

• Rental of crypto wallets, their creation and deletion;

• Automation of transactions with cryptocurrency and much more.

How it works

If we talk about the technical component of the services of blockchain providers, then this is a rather complex and extensive issue, since there are many general and specialized solutions. Moreover, the very essence of their services eliminates the need for users to delve into the technical jungle. For example, you are not too interested in how your previously mentioned hairdresser separates the strands of your hair or cuts the ends — the main thing is that the hairstyle turns out the way you want it. Similarly, with "blockchain as a service": providers invest an incredible amount of their own funds in business and development with the hope of receiving a significant benefit from the created solutions, so it is not always possible to even find out the technical features that constitute a corporate secret. For example, the authors of the Chainlink Labs platform invested millions of dollars in a startup that has already created a value of several trillion.

For clarity, let's compare the cost of services of some popular providers:

For familiarization, most providers provide a trial period. Also, most have an Enterprise offer — a package of custom services, the cost of which is calculated based on the individual needs of the client. But it is clear that ISPs are able to offer the right solutions for developing projects at reasonable prices, thereby eliminating technical obstacles and taking on a significant part of the responsibility.

API is the foundation of everything

As you can see, most services are based on a banal method of developing specialized APIs. We have already written about applied software interfaces on the Avivi blog many times, and for most users today this is already a common concept, so there is no point in dwelling on the theory in detail. However, cryptological APIs have their own characteristics and work much more complicated than their counterparts in the world of WEB 2. It is worth remembering that the blockchain has special requirements for data security, so this is also taken into account when configuring the interaction of software with blockchain nodes.

For the average user, the services of blockchain providers are provided in the same way as the services of any other services. We go to the company's website, register and choose a package of services, make a payment and use the necessary solutions under the terms of the lease. Regarding the cost, it is also not possible to say unequivocally: different services have different costs. But it should be understood that for any provider this is, first of all, a business, and quite a profitable one at that. Therefore, each service necessarily has certain restrictions or limits, for the expansion of which a higher tariff plan is required. Therefore, cooperation with providers is most effective at the initial stage of business development or development, when it is not economically profitable for you to maintain your own blockchain infrastructure, but it is better to rent its individual components. And when the project becomes successful, you can easily do without these services.

Case from Avivi

One of the first projects of our company, even before the deployment of its own nodes, was the development of a project that involved the use of a large number of crypto-wallets in several decentralized networks and numerous transactions during the day. At that time, the customer could not afford the support of several nodes at a cost of approximately $50,000 per month, so he had to use the services of the provider.

At the beginning, we were given immediate access to the infrastructure of five leading networks and given access to the testnet. This was necessary for long-term debugging of smart contracts before publication on the mainnet.

In the future, we expanded the list of services to use the cross-blockchain data exchange API. This was necessary to freely convert cryptocurrencies with lower transaction fees. To do this, we upgraded the service package to custom Enterprise, and at the end of cooperation with the provider, when our own APIs were ready, the cost of the package was $1,502 per month, which is 33.2 times less than the cost of self-maintaining the infrastructure we need.

A separate point was the connection of AML checks, which is also implemented by API methods. In general, costs for the development period using the provider's services were reduced by 4.5 times compared to the primary calculation of maintaining all the necessary infrastructure in-house. These are significant indicators for our customer's startup, which made it possible to redistribute the budget and effectively cover development costs instead of hardware support.

Today, the Avivi team has much more experience and technical capabilities, which allows us to partially solve customer problems at the provider level. Our developers create and test their own APIs that will help users implement their own projects on Tron, Ethereum, Bitcoin, Litecoin and Binance Smart Chain blockchains. As always, we are open to dialogue about investments and are ready to discuss issues of individual development and implementation of projects in the direction of WEB 3.0.