Smart Contract Development for Cryptocurrency Investment Platform

Functionality Overview

The client presented high-level requirements at the initiation phase, which we “translated” into a full set of SLAs, mockups, and use cases. For this, Itexus business analysts conducted a series of interviews with the client, and several workshops with our developers.

Here is what we offered for the business logic implementation.

The investment platform uses smart contracts to create trust between participants and provide additional guarantees to investors. Smart contracts are stored on the public blockchain where they can be neither erased nor altered.

To ensure its proper functioning, the platform uses custom tokens of two types: transferrable, which are freely distributed by token owners, and non-transferrable (NTTs), which can’t be accessed until a set date. NTTs will be locked in a smart contract with a 365-vesting period and 90-day cliff.

Tokens can be used in a number of ways:

• Investors rent tokens to other platform users. When the price is prepaid, the token will move to the user who rented it; at the end of the period the token will return to the token owner.
• For managing portfolios with variable risks, users need to possess a proportional amount of tokens in their wallets.
• Users pay platform fees with custom tokens at a reduced rate, and so on.

To deploy the smart contract technology, we studied different options and finally agreed upon a perfectly balanced tech stack, dedicated to smart contract implementation.

The solution is based on the Ethereum blockchain, one of the most popular platforms for building tokens using smart contracts. Its ERC-20 protocol gives mass acceptability to the delivered tokens and allows them to be re-used by other applications: from wallets to decentralized exchanges.

To accelerate the development process and at the same time stay in line with the best industry standards and security practices, we chose the OpenZeppelin library, the de-facto standard for secure smart contract development, used for more than 12% of the tokens built on Ethereum.

The library contains open source base contracts, which, combined with each other, provide customized contracts.

To make the system compatible with the ERC-20 protocol, our engineers leveraged OpenZeppelin’s contract files for the full implementation of the token standard. This way, we introduced a system of allowances for users who can emit or burn tokens; ensured built-in functionality for putting a pause for certain operations once a bug is discovered; added a list of blacklisted addresses to comply with the AML regulations.

Our developers used Solidity, a high-level programming language, which is most often used for smart contracts in Ethereum.

To provide USD to token exchange, we used the Coinbase platform. Its APIs allowed us to implement a ready-to-use solution which supports a whole payment workflow without extending the development phase.

A web app has been designed to provide an interface between the users and the blockchain, so they can see information and send transactions fast and easy, sign up/ sign in, and manage their wallets. For the development of the app, we used Python for the backend part and React.JS for the frontend.