With the development of blockchain technology, more and more people are interested in how to create a cryptocurrency. Actually, there are some ways to do this.
Cryptocurrency is a new phenomenon in our world, and though it is more than 11 years old, it is still being misrepresented by many. While some believe it to be a new form of money, others consider it just a buzzword. However, there is so much more to the story.
Cryptocurrency is a decentralized digital currency that uses encryption techniques to regulate the generation of currency units and to verify the transfer of funds. Anonymity, decentralization, and security are among its main features. Cryptocurrency is not regulated or tracked by any centralized authority, government, or bank.
Blockchain, a decentralized peer-to-peer (P2P) network, which is comprised of data blocks, is an integral part of cryptocurrency. These blocks chronologically store information about transactions and adhere to a protocol for inter-node communication and validating new blocks. The data recorded in blocks cannot be altered without the alteration of all subsequent blocks.
Today, more than 1,600 types of cryptocurrencies, including the most popular ones like Bitcoin, Ripple, and Ethereum, are available and the number is still growing.
Difference Between Coins and Tokens
There are two large subcategories cryptocurrencies are divided into – coins and tokens. Although they are both cryptocurrencies, there is a difference between them. If you understand their main concepts it will help you make your own cryptocurrency for specific business needs.
A coin operates on its own blockchain where all transactions occur like Bitcoin, Ethereum, Neo, and Emercoin, which operate on a different blockchain. If you wish to make your own coins, firstly you need to create your own blockchain.
A token works on top of an existing blockchain infrastructure, which is used to verify transactions and make them secure. Tokens are mostly used like smart contracts, which represent everything from physical objects to digital services. Everyone can use Ethereum or Neo as the underlying technology to start a new cryptocurrency. The initial use for tokens is a security token offering (STO), it helps projects and startups fund operations through a crowdsale. That is why companies start considering the question of how to create a cryptocurrency in the first place.
How to Create a Cryptocurrency: Technical Matters
You can make cryptocurrency by creating a totally new blockchain with a coin or by forking an existing one and creating a token. There are many online tutorials about how to create a cryptocurrency, although all of them require at least basic coding skills and an in-depth understanding of blockchain.
Ways to Create a Cryptocurrency
Creating a coin
This is not a good option if you are looking for an easy and quick way to create your own cryptocurrency free of charge. You should be an experienced professional in decentralized technologies or have a technological expert.
To create a coin it can take only 5 minutes. You just need to copy the code of Bitcoin, add a new variable, or even change the value of something, and you have your blockchain and coin. Besides, you should understand the code and how to change it and this requires extensive coding skills.
Another thing is to maintain, support, and promote the coin because you have to create the whole logic of blockchain to launch your coin. If you hire a team of professionals to cope with the task, it would save you more time, but you would have to pay a development team. If you have money for this, go for it.
Creating a token
This is an easier way to become a currency creator. On the one hand, you have complete control over the blockchain which is great, but on the other hand, this means increased development time, significant spending, and much more.
Fork cryptocurrency is created on top of an existing blockchain by utilizing the trust, popularity, and consensus mechanism of the underlying technology. If you build a token on top of a strong blockchain, like Ethereum, it means that your token runs on a secure network which is protected from fraudulent attacks. The creation of token is not so costly as far as money and time are concerned because you utilize the existing decentralized architecture and implemented consensus mechanisms.
Popular Solutions for Making a Cryptocurrency
To create a token there are a few blockchains that provide the means for it. The most popular tools are Ethereum, NEO, and EOS, they are also relatively easy to use.
Ethereum
This tool became the first blockchain which offered token creation service. As it is mature and has a strong position on the cryptocurrency market, it has an exceptional level of trust. If all tokens are built on Ethereum, they will use the ERC-20 standard. Moreover, the documentation is well written and organized, which makes the development process easier. A token on Ethereum can only be written in its own programming language - Solidity, but with the HTTP API you can create dApps in any language.
NEO
NEO blockchain is aimed at the smart economy and utilizes the NEP-5 standard. Almost any high-level programming language can be used including C#, Java, Python, and Kotlin to create your own token on top of it, unlike Ethereum. HTTP API is available for interaction with the blockchain.
EOS
These tokens use the EOSIO.Token standard. It can be created with C++ or any other language that compiles into WebAssembly. The blockchain offers great scalability, a huge number of transactions per second, and cost efficiency due to the lack of a truncation fee.
On the one hand, the majority of blockchains that can be used as an underlying network for a new token have broad communities and detailed documentation. But, on the other hand, you need to be an expert in programming to understand it all and use the knowledge for further development.
Since it is possible to create a new cryptocurrency by yourself following any "make your own cryptocurrency" tutorial, do not forget that only a team of professionals can choose the best stack of technologies and finish the development process in record time.
