The cryptocurrency industry has shown extraordinary growth in recent years. It has shown that it has enormous potential both economically and technologically. Dozens of digital tokens with their own goals and objectives appear every day. Against this background, many have the question of how to create their own cryptocurrency. This is what we will talk about in this article.
Where to start creating a cryptocurrency
The main task at the first stage is the formation of the main idea of the future development. It is important to understand from the creator’s point of view, for what purpose the token will be developed. Also, it is equally important to figure out what useful functionality it will carry to users.
More often than not, the reasons for launching a token are as follows:
- there is a desire to create a unique and attractive asset, which in the future will hit the trading exchange and bring income to its creator;
- cryptocurrency is needed as an auxiliary tool in an existing ecosystem that needs a blockchain-based payment instrument (within a service, computer game, platform);
- there is a personal interest in technology, blockchain and other things that motivates a person to create a coin without any financial or other goals.
Whatever the initial goal, it is important that the future project is something different from the variety of tokens that already exist at the time of the idea. Improvements and innovations will be the basis for the cryptocurrency not to remain something of interest only to its creator.
A bonus for newcomers will be the fact that when creating a digital token, there is no need to go through registration and other procedures at the level of official authorities.
The main ways to create a cryptocurrency
The cost of creating a cryptocurrency, the complexity and time-consumption of this process are parameters that directly depend on which method the developer chooses.
To date, there are three main ways of solving this issue that are popular. You can create your own cryptocurrency by:
- Developing your own blockchain from scratch (examples of cryptocurrencies: Bitcoin, Ethereum, XRP) – a task that will require not only significant intellectual, financial and time costs, but also the help of the development team. Even the famous and still anonymous bitcoin creator (Satoshi Nakamoto) used a similar one. Therefore, this way is the destiny of experienced programmers.
- Creation of cryptocurrency fork based on the code of already existing blockchain project (examples of cryptocurrencies: Litecoin, Bitcoin Cash, Dogecoin) – is implemented using the open source code of any of the existing decentralized blockchain projects, which will require making its own interesting edits and changes, without which the coin simply will not be in demand.
- Implementing a token that will be created and run on the power of another blockchain (examples of cryptocurrencies: Basic Attention Token, Tether USD, Maker) is the path that will be most convenient for most single novices and novice development teams. Blockchain cryptocurrency ethereum is popular, allowing you to use smart contracts to launch your tokens.
Creating your own cryptocurrency through a smart contract as a token that will add a coin to the “parent” blockchain is just what a novice needs. Not only is it easier, but it will cost only a few dollars, which will go to pay the fee for this operation. This kind of path is the best solution for implementing your own blockchain development ideas.
Description of the ERC20 token creation process
The Ethereum cryptocurrency blockchain has brought something fundamentally new to the world of blockchain technology. Its smart contracts made it possible to launch new tokens that are created and operate under the unified rules of the ERC-20 standard.
The process of creating the ERC-20 cryptocurrency in a simplified form will look like this:
- Find the source code of the standard token from the official website of the Ethereum project (you can choose between the minimal variant with limited features and the full – with the full set of features).
- Copy this data into the special blockchain development environment – it is recommended to use the Remix-Solidity IDE tool, which is available online on the official ethereum subportal (this tool will give the maximum functions, which will be even redundant for a beginner, as well as will be convenient due to the syntax highlighting and built-in code check for errors).
- We leave the source code functions untouched, so as not to knock down the ERC-20 standard, which is necessary to work on the etherium blockchain.
- Add your own changes to the source code, but do it with a view to the fact that editing from your side must not harm the existing functionality in any way (often for a beginner to master opportunities it is worth to make changes only in the name, ticker and available number of units of the future ERC-20 cryptocurrency).
- The finished code of the project requires publication in the blockchain via a smart contract – for this purpose, a wallet that supports this tool is used (most often the official Ethereum Wallet is used).
- Go to the wallet program, select the Contracts section and click on Deploy New Contract.
- In the window that appears, copy the source code of your project and choose a wallet for payment. After selecting the contract, specifying the project name, abbreviated name and number of coins, we choose the commission and send through the Send Token.
Note also that it is always possible to do a free pre-test of your project. This is done using a locally raised node on your device (Localhost) and in Testnet.
Once the process of creating a token is complete, the main task will be to popularize it and apply it to an existing external project for certain functions. Learning how to create ERC-20 cryptocurrency tokens already gives you a good foundation for future practice.
Creating a fork on your own blockchain
- download from GitHub the open source code of some cryptocurrency project you like (for example, one of the quite standard variants with the common SHA-256 algorithm);
- save the archive with all files on your computer;
- in all files (using special software) change the name of the cryptocurrency to your own – all the abbreviated and full names, names with capital and small letters;
- reconfigure all network ports and addresses (all files with information about ports-nodes for operations inside network are edited);
- edit the algorithm for generating new tokens, if necessary – you can change the block reward, generation time, emission (limit or not);
- it is also worth to make changes in the graphic elements, replacing them with your own icons and images that would be associated with your project.
At this point, the process of creating the simplest and even primitive fork can be considered complete. But if you try hard, you can get something similar to Litecoin, which is a fork of bitcoin but has much higher speed of transfers, lower commissions and more coins.
Creating your own cryptocurrency is a complex, expensive, and time-consuming process if you look at it from the perspective of implementing large projects with global objectives.
However, using Ethereum blockchain (for ERC-20 tokens) or Binance Smart Chain (for BEP-20 tokens), creating your token will be easy. Using one of these two tools is a good way to get started in the blockchain development field.
Taking your first steps in this direction will be easier thanks to the tutorials at our LocalTrade University.