To create a cryptocurrency coin, you need to create a native blockchain.And to create a blockchain, the best way is to hard fork an existing blockchain.
As of writing this, there are over 21 thousand cryptocurrencies, over 500 exchanges, and a market cap of around 1 trillion.And these numbers are growing every day.But how many cryptocurrencies do we know? Off the top of my head, I can list out maybe 20 of them.That’s another way of saying that the market’s saturated with cryptocurrencies.And this is good news and bad news.
The good news is, creating a cryptocurrency has never been easier.
Let’s narrow it down.Let’s eliminate the tokens and let’s focus on the crypto coins.
Now we have a better pool of cryptocurrencies.Out of the 21 thousand cryptocurrencies, we have 9100 coins.And that’s over 9000 ways to learn how to create a crypto coin.
Let’s begin the search; to find the perfect method to create a cryptocurrency.
Cryptocurrency Coin A crypto coin is the native digital currency of a blockchain.A crypto token is a cryptocurrency built on a pre-existing blockchain alongside its native coin.But, like everything, there are exceptions.
For example, stablecoins like USDT, USDC, and BUSD are classified as a coin as well, even if they are not the native currency of a blockchain.
The main factor is stability and value.Coins usually have a fixed limit of supply.The supply and demand economics gives crypto coins value.
The blockchain behind the coins provides a level of stability.
And that is what makes it a crypto coin and not a token, less volatility, and value.
Crypto tokens are digital currencies with values created out of thin air.There needn’t be any fixed supply limit, as the creator can mint any number of tokens in the future.It can be worth anything.
So that’s the three criteria a crypto coin needs to satisfy, a native blockchain, stability, and value.
Create a Cryptocurrency Coin for a Purpose Now that you know what a crypto coin means.I’ll start by saying that you must have a definite reason to create a cryptocurrency coin.I’ll explain why.
In January 2021, there were 8000 cryptocurrencies and around 1000 coins.In November 2022, that number increased to 21000 cryptos and 9000 crypto coins.Just comparing the crypto coins, that’s a nine-time increase in 23 months.Soon there will be even more coins, and the supply will outweigh the demand.
A crypto coin will not impress anyone.
All these blockchains cannot survive.Most of them will fall out of use.After all, only so many people are interested in cryptocurrencies, and even fewer know how to manage a blockchain.So, be very careful and have sound reasons before creating a blockchain.
It must have real-world applications.People should want to use it for more than just making money.Do not make one just for the sake of it.
Cryptocurrency White Paper A white paper is a manuscript that outlines the project, product, service, or solution of a company or a non-profit organization.Every crypto project must start with a white paper.
Creating a cryptocurrency is not a pet project.
At least try not to make it into a pet project.Even if the coin you’re creating is a meme, try to build on it.For example, Shiba Inu is a meme coin; it came out in competition with Dogecoin, another meme coin.It was essentially a joke with no value.
Now, ShibaSwap, a DeFi exchange, is built on it.And Shibarium, an upgrade of the blockchain itself, is coming.It has expanded into something more than just a meme coin.Soon than later, it will have a real-world utility.
And that is what you should aim to achieve.
These are the kind of plans you need to have.And this is what you have to articulate in your whitepaper.Why? Because running a blockchain requires people.I’m not talking about developing a blockchain.I’m talking about maintaining it, miners, validators, etc.
A blockchain only functions under a community of people.
A whitepaper is necessary to outline ideas and build a community.To attract the first users, you need a whitepaper.It is the source of that initial trust for your community.
Methods to develop a Blockchain There are two ways to develop a blockchain.
You can either create a new blockchain from square one or fork an existing blockchain.In both cases, you will need some technical support or computer knowledge.Hiring a blockchain developer is imperative.
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Forking an existing blockchain is the quickest way to get started.Building a new blockchain will take months, maybe even years.
You will need technical support staff throughout that period.You will need funding to keep the process running.Even so, launching a blockchain will not guarantee success.Without a sizeable community to maintain the chain, a new blockchain will become an easy target for hackers.
Garnering the attention of a blockchain-based tech community is not an easy feat.
By forking a blockchain, you’re dividing the blockchain in two.And the new blockchain will be your project’s tool to create a crypto coin .For example, Bitcoin Cash was hard forked from the Bitcoin blockchain.Bitcoin Cash (BCH) aimed to remove the limitations of its parent chain.
BCH improved the block size, transaction fees, and transaction speed.
Bitcoin SV is a hard fork of the BCH Network.So, a blockchain network can fork many times.
As blockchain codes are open source, they can be modified and forked to launch new blockchains.And there are software tools to conduct these forks, like Forkgen.And those who fork these chains can modify the parameters of the blockchain to their needs.Ravencoin is another fork of the Bitcoin Network.
Likewise, Litecoin, although not forked, is also a crypto created from the source code of the Bitcoin Network.
And there are four elements to change in a blockchain.
Consensus Ledger Cryptography Smart Contract Consensus If the blockchain you’re forking has a different consensus mechanism, you could change it to something else.In theory, a hard fork can change the consensus mechanism.For example, Bitcoin uses the Proof-of-Work consensus, a highly energy-intensive process.And the debate about introducing a Proof-of-Stake has been discussed many times in the Bitcoin community.
Ledger Any blockchain has a block size, block creation speed, halving period, a limit on the number of coins, etc.And these preset requirements in the code, which you can change.
Cryptography Cryptographic hash algorithms are another vital aspect of blockchains.
It’s what makes crypto mining possible.For example, when Litecoin forked the Bitcoin Network, it replaced the SHA-256 function with the Scrypt hash algorithm.Likewise, when Ravencoin forked the Bitcoin Network, it changed the SHA-256 with the KAWPOW algorithm.
Smart Contract Like Ethereum with the ERC standard and Solana with the SPL standard, new smart-contract standards can be added.These standards are nothing but a set of rules and instructions to follow.For example, Polygon was based on the Ethereum chain and has adopted using the ERC standard.However, Tron was also built based on the Ethereum blockchain; it uses the TRC smart-contract standard.
Hence, the quickest way to launch a blockchain is to use the code of an existing blockchain and hard fork it to create a new one.Choose a blockchain with a few drawbacks, and solve the flaws with your forked version.
Upgrade the software, add new functions, improve block size, alter hashing process, etc.
Blockchain Testnet Testnet means a testing network.A blockchain testnet is a way to beta test a system.It’s a duplicate of the original blockchain, but the crypto stored on it has no value.
Thus it cannot be mined.And the original blockchain is called mainnet.
Since the testnet has all the features and functions of the mainnet, it is perfect for testing.The software used in blockchains is often updated.Smart contracts can be deployed and tested.
DApps are usually deployed and tested.
A testnet can keep running separately from the mainnet for years after the mainnet is active.Developers use the testnet constantly.
Legal Framework Regulations differ depending on the region.While blockchain is simply software online, crypto assets come under regulatory scrutiny.There is still much debate on the nature of crypto assets.Some claim that cryptocurrencies are securities, while others claim it is not.Hence, global regulations are variable.
And this has created regulation-free zones like Portugal.Strict regulatory zones like South Korea and India.A complete crypto ban in China.And a crypto-friendly neutral zone in much of the EU and the US.
Crypto frauds, hacks, and phishing sites are a dime a dozen online.The recent FTX contagion is a good example.Almost every major centralized exchange has been subject to a hack in the past.
And 2022 is by far the costliest year in crypto hacks ever recorded at over $3 Billion.
Consult a legal firm or an audit firm before you launch.A vital step in blockchain development is hiring a third-party professional audit.Audits foster confidence in potential investors about your startup.Investors can feel more secure knowing that your project adheres to industry standards.
Build a Crypto Community A cryptocurrency’s strength lies in the size of its virtual community.Community support will be essential from the moment an idea gets launched.Perhaps I should have started with this topic.
If you have an idea but not enough capital to implement it, a community is what you need.
Building a community is more than about running a blockchain.There are many programming languages and countless ways to program.
A diverse group of members can find bugs and errors in your code that you might have missed.
They will have ideas you haven’t considered, and they may have solutions that you haven’t thought to solve.You have to market your idea to enough people and gain their support.
If a blockchain’s source code is vulnerable to external threats, it cannot function for long.And if it doesn’t have enough miners to keep it running, it will fall out of use.
For example, there used to be a forked blockchain called Luckycoin.It’s a fork of the Litecoin blockchain.The infamous Dogecoin blockchain is a fork of the Luckycoin blockchain.Since the blockchain has fallen out of use, it has disappeared entirely.
And that is why it is necessary to keep innovating the project even after you’ve managed to garner enough interest.
And that is also why the most successful crypto projects often announce new events.Like the space program, you must reinvigorate interest.
Marketing Now, this is often an overlooked topic in crypto projects.Till your blockchain is up and running crypto project is an ICO.And marketing is the most vital part of an ICO.Before we go into that, I’ll briefly explain the choice between ICO and IEO.
When you’re looking to raise funds through an IEO when developing a blockchain: the funds may come with conditions.So for full autonomy, I would choose an ICO process over an IEO.Or vet the IEO thoroughly before you collaborate with an exchange.
So, coming back to ICOs, there are three stages of marketing.
Pre-ICO (Before) ICO (During) Post-ICO (After) Now all three marketing campaign is for raising funds and garnering interest.
The more people you reach via your marketing campaign, the better response you can expect.
And the more diverse your audience is, the better viewpoints you can assess.And marketing campaigns consist of advertisements, articles, blogs, press releases, airdrops, NFT releases, learn-to-earn programs, etc.
The future of your blockchain and your crypto project depends on this phase.So, take your time with this phase.
Conclusion So, let’s summarize what we’ve covered so far.Determine the purpose of your crypto project.Publish a white paper for your project.Choose how to develop your blockchain.
Develop your blockchain and launch your testnet before the mainnet for beta testing.Clear all legalities of the project.
Build a community for your blockchain project.And finally, market it.
Keep in mind that most of these steps will overlap with each other.
Follow your prerogative and divide the steps clearly before proceeding toward each milestone.Good luck on your journey forward within the crypto space.
Also read >> How to create a cryptocurrency exchange platform.
