Cryptocurrencies and other decentralized digital assets such as NFTs,
fulfill an ever evolving range of blockchain powered cases for.
Converging industries.
Which include the likes of decentralized finance, both Web 2 And Web.
3, the Internet of Things and artificial intelligence.
If you've ever thought
about following in Satoshi and Vitalik's pioneering footsteps.
And creating your own cryptocurrency to.
Help build. The future of money.
Then be prepared for a fascinating.
But very challenging journey.
So in this guide, we'll take a look at what it takes to.
Create your own cryptocurrencies.
In the various options available to you.
First of all, what to understand before you start.
Well there are many things to grasp before you start the complex process
of designing your own crypto, just like any digital real estate
on the web, you're going to need to market the new asset effectively.
To ensure it gained.
Traction and gets adopted by a community.
So let's start with the basics. When creating. A cryptocurrency.
You have the option to.
Create either a coin or a token.
A coin operates on its own blockchain, while a token is built on
an existing network.
Both rely. On a. Blockchain for security.
And decentralization, and there are three main ways to.
Create a cryptocurrency yourself.
First of all, building your own blockchain.
So a coin modifying an existing blockchain.
So a coin or building on top of an existing blockchain.
So a token to choose the right. Option for your project.
You'll need to weigh up additional.
Factors such as.
Legality, use cases, tokenomics and startup costs beforehand.
And depending on the route that you take,
you may require anything from basic to specialized technical and programing
knowledge, as well as a hefty commitment of time, money and other resources.
Finally, maintaining.
Nurturing and growing your cryptocurrency over time will.
Be the biggest challenge of all.
And next up, we'll talk about coin versus token.
So cryptocurrencies can be split into coins
and tokens, and it's crucial to understand the difference.
While a coin like Bitcoin or Solana exists on its own blockchain,
it token lives on a specific base chain adhering to a specific format like ERC 20.
So Ethereum BEP20 So Binance Smart chain, SPL like Solana and so on.
Coins have a specific utility.
Over their whole network, such as for gas or for governance
and or normal use to store or create or transfer monetary value.
Between. All participants.
For example.
Some ETH is required as a gas fee to power.
Any transaction on the network, whether the currencies involved are ETH or.
ERC20 Token.
Tokens, meanwhile, are built on blockchains
that already exist and provide a specific utility.
For their own projects such as governance or staking.
They are not used for gas.
Which limits their use, case and also value.
Next up, let's talk about the whitepaper.
So a founder will usually create and.
Publish.
A crypto whitepaper before launching a cryptocurrency.
And it's basically a detailed technical document that explains.
What the crypto project.
Is trying to achieve and also how whitepaper.
Is very important for early fundraising
and drawing attention from early supporters.
It blurs the line between an academic. Paper and a.
Business plan, relaying both technical and economic specifics, including how.
The cryptocurrency aims.
To meet a specific need, solve an existing problem and also.
Improve our lives.
Papers should also provide insight into the Crypto's tokenomics and also roadmap.
They should be easy to understand
and offer technical explanations of the project's competence.
What to consider. Before starting.
Well, before creating a
cryptocurrency, there are a few important considerations to mull over.
While most will be simple enough, others such as legality,
could cause you a massive headache if you don't.
Do your own homework.
What is the purpose and.
Use case of my. Cryptocurrency?
Every cryptocurrency.
Should in theory have a use.
Case or purpose that serves.
A unique selling proposition or USP.
For your crypto.
This use case, as outlined in the White Paper,
will determine the type of blockchain and technology that you will use.
So which consensus mechanism should I use and why?
Well, the early days of crypto
solely preference for proof of work over proof of stake networks.
Consensus mechanisms and a consensus mechanism helps to process.
Transactions and secure the network, and.
Its choice will affect the energy consumption, decentralization and.
Security of the cryptocurrency.
While proof of work chains like.
Bitcoin are praised for their great.
Decentralization and. Security.
They are also energy intensive and expensive to maintain.
Ethereum last year became. A 99. 95% more.
Energy efficient when it moved from.
Proof of work to proof of stake during its merge upgrade.
Should I issue a. Coin or token?
While there are big. Benefits.
To creating. A token. Over a. Coin.
It's easier and much cheaper to create.
A token than to issue a coin which requires you to establish.
Your own. Blockchain and then try. To secure it.
So for example, in early.
20 tokens can be created in minutes and leverages Ethereum's.
Superior and Battle tested.
Security, while.
Also having access to a huge compatible ecosystem and community of.
Existing users.
And of course, let's.
Not forget many hugely popular coins such as ADA, BNB Coin, TRX and LINK
started as humble ERC 20 tokens before they.
Finally merged their own.
mainnets, once they grew too big over.
If you decide on issuing a token, you'll have to adopt.
The architecture and rules.
Of the underlying blockchain and likely
also all the transaction fees you generate will be denominated in its native.
Asset. So for example, all your. ECR20 token.
Transactions require some ETH for gas in order to execute.
Now let's talk about the Tokenomics.
So Tokenomics is an absolutely vital component of.
Any cryptocurrency.
Which is still completely misunderstood by some crypto.
Investors.
Tokenomics relate to the supply and demand of your. Cryptocurrency.
And is an essential element for any savvy.
Investor who might. Look at how many coins.
Or tokens will be created and how they are released over. Time.
How much is owned.
By the creators or early investors.
And. How they are burned or bought back in order to curb emissions?
Get it wrong and your.
Project will eventually pay the price. Do I.
Get a developer or. Build it myself?
Or designing, building and maintaining.
A cryptocurrency. Is no small feat.
Even Satoshi Nakamoto had some help when launching Bitcoin and.
Also requires specialized technical expertise.
If you're not a developer, there are options to create it yourself
or hire a blockchain developer or service provider.
This can also become a very costly depending
on the skill of your change scopes and also activity.
Next up, let's talk about the whitepaper and also website.
Is your whitepaper.
Sophisticated, specific and different yet simple enough to understand.
Creating a clear and concise whitepaper and.
Website helps to claim a rightful stake.
For your. Cryptocurrency and. Aligns your vision.
And strategy with its roadmap for the whole world to see and also invest.
Three Ways to Create a Cryptocurrency.
Now that you
hopefully know what you want to build and why, it's time to actually.
Create your magic Internet money. And there are three.
Main ways in which.
You can create your own crypto asset, and the first one.
Is modifying. Or forking.
An existing chain than we have, building on an existing Layer one or layer two.
Blockchain.
And then we.
Also have creating a new blockchain.
So creating a coin, launching your own chain to create a cryptocurrency.
Is the most difficult path by some.
Margin as it requires resources such.
As advanced coding and other technical skills.
While educating yourself through online. Courses.
Can help. They may require
some preexisting knowledge and also may not be in-depth enough.
First of all, let's talk about modifying.
Or forking. An existing blockchain.
So creating a coin.
Don't have the resources to create your own. Blockchain one.
You can actually. Use the source code.
Of another blockchain to create a new blockchain and native.
Digital currency.
Working an existing blockchain actually might be.
Quicker and less. Complicated.
Than creating a new one from scratch.
Since the code for most blockchains is. Open source.
Allowing you to download and modify it as you wish.
And this method still requires advanced technical knowledge to avoid.
Security vulnerabilities.
Bugs, flaws and other issues.
And then we have using an existing platform.
So creating a token if you don't know how to code.
And or don't have.
A big budget, this is definitely the path to take in 2023.
It's easy to.
Launch a cryptocurrency or token.
On an existing platform.
Like Ethereum or.
Even compatible chains such as Binance.
Smart Chain or ETH Layer two chains.
Such as optimism. Ethereum Network uses the ERC 20.
Standard, which is less technical than the.
Others and also doesn't require as. Much programing.
Knowledge over your.
Cryptocurrency is dependent on the blockchain that you choose can code.
No problem.
There are plenty of developers and.
Companies that can do the technical work and then hand you a finished product.
It's also a good idea to at least.
Learn a bit of programing in order to. Understand the existing.
Blockchain infrastructure and of course the platform that you're working on
and then figure out when you're being overcharged for your ignorance.
So here is the.
Step by step guide on how to create.
A cryptocurrency.
It's really the general process and it's going to be kept simple.
We will.
Assume that you're going to create a cryptocurrency with a real purpose.
And vision.
So step.
One research the use cases before you start. Building.
Figure out the following. As we.
Covered earlier, what are the.
Use cases and unique selling proposition?
What problem does it solve? And also what benefits will it.
Offer to potential users?
Is there any chain already doing it?
And if so, can you do it better?
Creating a new crypto.
Asset is. New different from launching a new startup.
Business in many ways, and the same planning.
Is required to garner enough.
Hype, something that the new generation of NFT founders is becoming.
Very adept
at doing a lot of marketing analysis and research in order to boost your.
Chances of achieving a real product and also market fit.
Knowing what problem your token solves will also help you identify.
A responsive target. Audience and.
Create a highly targeted marketing.
Plan post-launch.
Now step two Choose a consensus Mechanism.
Choose a mechanism that. Aligns with your goals and requirements.
Such as computation.
Intensive proof of work or energy.
Efficient proof of stake. Some mechanisms are.
Very. Innovative, such as Solana's proof.
Of history or POH But it also can come with other problems.
Now Step three Select. A blockchain platform.
Choose a blockchain platform to host.
Your token Ethereum and Binance Smart Chain are.
Popular choices, but there are many.
Other options to consider and consider factors.
Such as cost, scalability and. Security.
When making your decision. Now step.
Four is publish your whitepaper on your website.
And social media with steps one and three behind you.
You should really understand what you're trying to build inside and out.
By now, it's time to put.
This information together in your own manifesto, Research.
Successfully launches by other chains and figure out what they did right and wrong.
Compare their post launch results with their Tokenomics in networking missions.
Create your own Tokenomics structure in response.
Now write your whitepaper and. Publish it on your website.
Then share it far and wide.
And step five is design the nodes.
Nodes are the building blocks of a blockchain that.
Store and verify your. Transactions.
Get the.
Necessary hardware such as processors.
Memory and disk size.
If it's required.
And step five is.
Establish your blockchain's internal architecture.
Now create your blockchains internal architecture
and its rules and parameters such as.
Address and public private key
formats, permissions and how the crypto asset will be issued.
Be sure to carefully consider these factors as.
They cannot be changed without a.
Software upgrade once the platform is.
Running and step six. Is create your coin or token.
Now it's finally. Time to create your crypto asset.
If you're going to ECR20 root, then. You can take an online.
Course first and you.
Can also use one of the many free online tools.
But be sure to do some thorough research First.
Make sure the platform can be trusted
and is capable enough in order to avoid a malicious code and also scams.
Alternatively, hire a blockchain.
Developer with good ratings on a crowdsourcing freelancer site.
If you can actually afford it.
And step seven is designed the API and.
User interface, or you.
Want design a user friendly interface to help your blockchain communicate.
With its participants.
And step. Eight is promote your crypto. And build a community.
Okay, Proud new parent.
It's time to.
Spread the word.
About the newly chosen one to.
Build your devoted followership.
Reach out to crypto influencers but of course.
Not pump and dump chillers.
Find a partner idea, launchpad or exchange to list your assets.
Develop a campaign.
Do airdrops if.
Viable. And participate in.
Relevant online communities and. Also forums.
And if you're in the U.S., understand.
What the Howey Test is to.
Avoid securities related legal issues later.
So creating your own cryptocurrency.
It may seem like a daunting challenge at. First, but.
So is the prospect of on banking yourself and.
Managing your own while.
Follow the information and steps in this guy closely.
And you should be well on your way to what will hopefully turn out
to be a passionate.
New, lifelong pursuit. And let's of course hope.
That this pertains to you and not the regulators chasing you.
Good luck on your journey.
Keep learning and building and do what you must do.
Stay off the dead coins list.