A few months ago when I first started learning about Cryptocurrencies, It felt like I had been thrown into a whole new world with people using complex terms I didn't understand anything about. One concept in particular I struggled to understand was that of APIs.
It took hours of tutorials and personal research to finally understand what APIs are and what they do. So, if you're a trainee web developer, crypto enthusiast, or a newbie to crypto trading, and you currently have a similar problem that I had, then this is the one tutorial you are going to need.
Using simple language and easy-to-understand analogies, at the end of this tutorial, you'll save yourself hours of research time, and you will be able to answer the basic questions:
- What are Cryptocurrency APIs and how do they work?
- Why are Crypto Currency APIs important?
- What are the top APIs out there?
Now let's dive in!
What Are Cryptocurrency APIs, and How Do They Work?
To understand this, we must first understand what APIs are. API is an acronym that stands for Application Programming Interface.
Sounds complex? let's break it down.
An application is software that helps people obtain information about specific things or carry out particular tasks like how the Expedia app on your phone helps you book flights on the go or the Amazon weather app helps you check weather forecasts.
An interface in this context, is a program that helps 2 applications or websites communicate with each other, kinda like a middleman. So an API is basically a program or a “link” that helps two apps (or websites) “talk” to each other about a particular thing. So, when an app (let's call it app A) needs information about a particular thing or needs access to a service rendered by another app B, an API of app B is used.
This API for app B serves as a link, a connection via which the specific information app A requires from app B is obtained.
Wait … What?!
Okay, okay. Let's break it down further using this analogy:
Imagine you're opening a bakery, and you decide to sell cupcakes, muffins, and sourdough bread. For some reason, however, you don't have the capacity to make sourdough bread of your own.
What do you do?
You reach out to another bakery that sells sourdough bread. Make an agreement for them to sell you sourdough bread when you request it.
So, every time you need bread, you reach out to an employee of that bakery, and he brings you the bread.
Now, bread isn't the only thing this second bakery sells, but it's the only thing you need from them. That's basically how an API works.
When an app needs information that it cannot provide on its own, it uses the API of another app to gain access to that information from the other app.
For a more technical analogy.
Let's use a flight booking app to illustrate how APIs work:
Imagine you're using a travel app like Expedia to book a flight. When you search for flights, the app doesn't have all the flight information stored locally. Instead, it uses specific APIs to fetch data from airlines' systems or other flight databases.
Here's basically what happens behind the scenes:
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The travel app sends a request to the airline's API (e.g., "Get flights from Nigeria to New York on August 26th").
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The airline's API processes the request and returns the relevant data (e.g., flight numbers, departure times, prices).
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The travel app receives the data and displays it in a user-friendly format.
So you see:
- The travel app is the "client" or "consumer" of the API.
- The airline's system is the "provider" of the API.
- The API acts as an intermediary, allowing the travel app to access the airline's data without having to replicate it locally.
So, if I’m an app developer and the app I'm working on serves to provide specific information about the flight schedules from Qatar Airways for instance, I will use an API of Qatar Airways to get me and my future users access to that information.
Now that we understand what an API is, applying that knowledge directly, we can say that cryptocurrency APIs are basically programs that enable different apps or websites to get access to specific data about Cryptocurrencies (i.e., chart updates, transactions, etc.) from other websites that directly monitor and interact with the Crypto Market.
So, if I want information about the current status of Bitcoin on the Crypto Market, I open a website like Dervi.
This website cannot monitor the Crypto market directly, so it uses an API to get information about current Bitcoin status from the Trading View website.
Why Are Crypto Currency APIs Important?
From what we've discussed earlier, we can say some of the importance of these APIs to Cryptocurrency are:
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Real-time data access: APIs provide up-to-date information on market prices, trading volumes, and blockchain data, enabling informed decisions.
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Research and analysis: APIs provide data for researchers, analysts, and investors to study market trends and make predictions.
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Integration with other services: APIs enable integration with payment systems, e-commerce platforms, and other services, expanding cryptocurrency adoption.
In essence, cryptocurrency APIs facilitate innovation, automation, and accessibility in the cryptocurrency and blockchain ecosystem.
What Are the Top Cryptocurrency APIs?
Now that we understand what APIs are and can see why they are so important, let's look at some of the top Crypto CryptoCurrency APIs:
Coin Market Cap API
Coin Market Cap is one of the best cryptocurrency data APIs. So as a developer, incorporating it into your app or website will be really beneficial. You see it offers real-time cryptocurrency data and market information, such as:
- Historical cryptocurrency data since 2013
- Live price updates for cryptocurrency assets
- Market data, volume, and exchange information
- Trading data and analytics
- Data on non-fungible tokens (NFTs) Enterprise, professional, and free API plans
This is an API that is used all over the world by cryptocurrency traders, developers, and financial firms.
CoinGeko API
CoinGeko is a big name amongst web developers! It offers many exciting features and has an easy-to-use interface. It has its own charts which it uses to track several coins in the Crypto market. Some of the important features it offers are these:
- Real-time and historical crypto prices,
- Market capitalization data,
- Trading volume and exchange data,
- Metadata,
- NFT collection floor prices.
Coin Gecko API offers a free plan! As well as several paid plans with additional features and support.
Binance:
Binance is considered one of the largest cryptocurrency exchange platforms globally. It allows users to buy and sell digital assets.
Its free API allows web developers to interact with the Binance platform and create custom trading applications like:
- Executing trades and checking their account balances.
- Viewing their trading history using the API.
- Enables developers to create custom trading strategies and automate their trading activities.
The world of cryptocurrency is constantly changing, evolving, and expanding. APIs make it easier for web developers to build cryptocurrency-related apps, wallets, exchanges, and analytics tools. Which makes monitoring of trends within the Crypto market much easier for traders.