In today's rapidly evolving financial landscape, digital asset management has never been more crucial. Blockchain companies are handling a myriad of assets, from cryptocurrencies to NFTs, all requiring intricate management.
As these companies scale, they find themselves at the crossroads of a strategic decision: Should they build their digital asset management system from scratch, or should they adopt pre-existing solutions like CoinsDo?
In this blog post, we will delve into this question by examining different facets such as security, cost, and time taken to build/go live etc. to provide a holistic perspective.
When considering the construction of an in-house digital asset management system, it's easy to be lured by the benefits of complete control and customization. However, one of the most critical and often underestimated aspects is the management of private keys—the cryptographic elements that secure access to digital assets. Even in a system designed with the most robust and sophisticated security architecture, the handling of private keys presents an inherent risk that can't be fully eliminated.
This is due to the exposure of private keys at various stages—during operations, maintenance, and technical development. These keys must often be accessible to different teams within the organization for system updates, operational tasks, or even emergency troubleshooting. This scattered exposure to multiple personnel inadvertently creates multiple points of vulnerability.
With more people having access to sensitive information, the likelihood of a single point of failure increases. This could come from a disgruntled employee, a team member susceptible to external influences, or even human error such as mishandling or misplacing key information. In worst-case scenarios, malicious insiders could even execute unauthorized transactions or divert assets.
Thus, while building an in-house digital asset management system gives you the autonomy to make real-time decisions and adapt quickly to market changes, it also exposes you to a spectrum of risks that are proportionate to the level of control you have.
Unlike traditional in-house digital asset management systems, where multiple personnel have access to private keys at different stages, CoinsDo offers a significantly more secure approach. With our specialized solutions like CoinGet and CoinSend, only the individual who originally created the account can access the private key.
This centralized approach to key management eliminates multiple points of vulnerability, thereby drastically reducing the risk of internal fraud or sabotage. By consolidating key access to a single trusted individual, CoinsDo ensures that the management of your digital assets is both secure and efficient.
Building a robust digital asset management system in-house comes with a plethora of costs that can easily be underestimated. Let’s break it down:
Hiring a Specialized Team: The most immediate cost is assembling a team of blockchain developers, cybersecurity experts, and system architects. According to various industry reports, blockchain developers are among the highest-paid professionals in the tech space.
Depending on the expertise required, salaries can range from $100,000 to upwards of $200,000 per year for each developer. For a small to mid-sized team, this could easily translate into a yearly expense of over a million dollars.
Server/Node Maintenance: Another significant expenditure is server maintenance. Servers capable of handling large volumes of transactions and data storage are costly to purchase and maintain. Furthermore, the more blockchains you support, the greater your server requirements, the more you pay. Even if you subscribe to a 3rd party RPC node, the cost is still rather significant.
Continuous Upgrades: With technology evolving rapidly, especially in the blockchain space, an in-house system will need constant updates. These upgrades not only require developer hours but can also result in additional server or hardware costs.
CoinsDo provides a compelling alternative by virtually eliminating many of these upfront and ongoing costs. The solution is designed to integrate seamlessly with existing infrastructures, meaning businesses don't need to invest in specialized hardware or a new team of blockchain experts.
CoinsDo's pricing model is also based on a Software-as-a-Service (SaaS) approach, which includes upgrades, security, and server maintenance as part of the package. This substantially reduces both the initial capital expenditure and operational costs.
Time to Build/Connect
When contemplating an in-house digital asset management system, time is an often-underestimated factor. It's not just about writing lines of code; the complete cycle includes several phases that can elongate the timeline considerably:
Ideation and Planning: Even before the first line of code is written, considerable time must be devoted to planning. This involves architectural decisions, resource allocation, and mapping out development sprints. For a complex system, this phase alone could last several weeks.
Development and Testing: Developing the core functionalities of a digital asset management system is a monumental task requiring several months or even years, depending on the feature set and the expertise of the development team. This phase also includes multiple cycles of rigorous testing to iron out bugs and security vulnerabilities.
Connecting to Various Blockchains: An effective system should be able to connect to various blockchains, which takes time. If you need to support more than 30 chains, the process might take up to a year.
Deployment and Onboarding: Once the system is built and tested, it must be deployed. Depending on the size and complexity of the business operation, this phase can take additional weeks for integration and onboarding.
CoinsDo provides an accelerated pathway to implementing a secure and efficient digital asset management system. With pre-built solutions like CoinGet for asset deposits, CoinSend for automated payouts, and CoinSign for transaction verification, CoinsDo offers turnkey solutions that can be integrated swiftly into existing systems.
Designed for seamless integration, the technical lift is considerably lighter. Businesses using CoinsDo can literally get their asset management system up and running within a week.
Building a digital asset management system in-house has its merits, such as complete control over functionalities and customization. However, the associated costs, the expertise required, and the time needed to build, test, and deploy a secure and efficient system are considerable. On the other hand, CoinsDo offers a comprehensive suite of tools that meet the requirements of modern financial institutions, ensuring security, cost-efficiency, and quick deployment.
After weighing the pros and cons of each approach, it becomes apparent that for most businesses, particularly those with large user bases and high transaction volumes, CoinsDo emerges as the better choice.
If you're in the market for a reliable, secure, and cost-effective digital asset management system, reach out to us to learn how CoinsDo can empower your business.