Are you someone toying around with the idea of launching your very own cryptocurrency? According to Coinmarketcap, as of 2021, more than 8,000 cryptocurrencies are in the market, and the number is growing daily.
In this blog post, we’ll discuss everything from creating a new cryptocurrency to dealing with the legal side. We’ll also share our best tips on getting your coins out into the world. So, if you’re ready to make some waves in cryptocurrency, let’s dive in!
1. Identify the purpose of the cryptocurrency
The first step in creating a new cryptocurrency is identifying a compelling use case for the proposed digital currency. Cryptocurrency can be used for various purposes, such as the transfer of money, an alternative form of wealth storage, support for smart contracts, data verification, and smart asset management.
2. Choose a blockchain platform to build on
Cryptocurrencies are rooted in blockchain technology, and each blockchain platform operates differently depending on the consensus mechanism it uses.
1. Develop your own blockchain and native currency
This is the most difficult technique and needs deep technical expertise to design your own code, but it also provides the greatest freedom in creating a creative coin.
2. Enhance an existing blockchain
You can tweak the open-source code of another blockchain to suit your digital coin. This solution nevertheless necessitates considerable technical expertise to prevent faults, loopholes, and other issues that have afflicted established cryptocurrencies like Ethereum. However, since the framework has already been constructed and proven, less development is necessary.
3. Create a new coin based on an existing blockchain.
Platforms like the Ethereum network, Binance, Solana, and Ripple all allow for the creation of new coins on top of their existing blockchains. While this technique allows for less customization of your token, it is possibly the simplest way to establish your own blockchain.
3. Decide the consensus mechanism
Blockchain technology is a digital ledger that chronologically records every cryptocurrency transaction – from legitimate ones to those potentially fraudulent. A screening process is necessary to ensure only valid transactions take place. This is exactly what a consensus mechanism does.
Two of the most popular approaches involve proof of work and proof of stake.
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- Proof of Work: Miners compete to solve complex math puzzles to win rewards in cryptocurrency. Eg Bitcoin
- Proof of Stake: miners work collectively on projects, with one random miner eventually receiving payment for their efforts; they must also demonstrate ownership of a sizeable stake in the cryptocurrency they’re mining. Eg Ethereum, Polkadot
- Delegated Proof of Stake: In a blockchain network that uses DPoS, token holders can vote for a group of “delegates” who are responsible for validating transactions and maintaining the network. Eg TRON
6 popular blockchain platforms
- Ethereum
- Polygon
- Binance Smart Chain
- Cardano
- TRON
- Polkadot
4. Set up the necessary nodes
Once you’ve selected a blockchain, the nodes that work in the blockchain must be created. Nodes are usually fast computers that connect to a blockchain network to verify and process transactions. Nodes keep the currency running while recording and sharing the data that eventually gets added to the digital ledger.
Setting up nodes involves multiple important considerations to ensure a strong and functioning cryptocurrency network:
- It is essential to determine who has access. Public nodes are available for anyone, whereas private nodes are kept off the public eye.
- Deciding where nodes will be hosted must also be considered; cloud networks can provide a haven for nodes or local nodes for added security.
- Discovering which operating system will work best with the cryptocurrency is also vital: open-source systems like Ubuntu and Fedora are recommended, as they allow developers to alter software according to their needs.
- Developers should not overlook hardware components like processors, RAMs, and GPUs.
As nodes need more power so that they can process transactions faster.
- Develop Application Programming Interfaces (APIs)
An application programming interface, or API, is a way for developers to connect and interact with a blockchain network or a specific node. The API allows developers to access and use the functionality of the blockchain in their own applications. It’s possible to use multiple APIs for different purposes, such as monitoring the value of a cryptocurrency or retrieving public information from the blockchain.
6. Design a user-friendly interface
To make cryptocurrency user-friendly, developers should focus on the user interface (UI) and user experience (UX). A simple and easy-to-use UI/UX will make it more likely that consumers and miners can easily navigate and manage their investments.
7. Familiarize yourself with legal regulations and compliance
Developers creating a new cryptocurrency should be aware of the legal considerations that come with it. They should research and understand the laws and regulations specific to the cryptocurrency’s jurisdiction and ensure that it complies with these laws.
This includes understanding and complying with laws related to anti-money laundering (AML) and know-your-customer (KYC) regulations, and any taxes that may apply to transactions made using cryptocurrency. It is also important to consider any potential legal risks associated with the use of cryptocurrency.
How to Launch your crypto?
Now that you have the cryptocurrency development sorted, you may wonder how to launch it. One option gaining popularity is an Initial DEX Offering (IDO). An Initial DEX Offering (IDO) is an innovative way to crowdsource funding for your crypto project.
In return for investing early in a project, token holders receive a discount on the eventual price of the tokens when they hit exchanges. IDOs have already attracted a great deal of interest from both businesses and investors, and they are poised to become the future of fundraising.
In an IDO, a Web3 project launches a token on a DEX via IDO launchpads to generate funds from retail investors.
When choosing IDO launchpads, AdLunam stands out as an innovative option. Along with the regular IDO launchpad service, the platform comprises a seed pad, and an Engage to Earn “Proof of Attention” model. In AdLunam, investors are allocated based on their Attention Rank. The Launchpad also allows upcoming projects to raise capital for their seed and private rounds.
Hence, if you’re looking for an IDO launchpad with some added benefits, AdLunam is worth considering.