How to Create a Crypto Token for Blockchain Startup
It might look like a task that requires programming experience, but creating a crypto token is easier than you think.
Just like the 1990's dot com rush, Cryptocurrency is the new rush in the tech world. Many have chosen to have their slice of the cake.
There are unlimited opportunities in crypto, and lately, it is begging to see a positive reaction to its acceptance. Cryptocurrency is getting more popular, and many companies are beginning to adopt it. Its uniqueness as decentralized finance is finally paying off, cooperate bodies and individuals are beginning to see the unlimited opportunities in the crypto.
The traditional ways of generating funds by IPO (initial public offering) for startups and cooperate bodies are fading off. Cooperate bodies and startups are beginning to adopt blockchain technology and cryptocurrency. They are starting to create crypto tokens through ICO (initial coin offering) to raise funds for their projects.
Although ICO has begun to lose its dominance due to many factors in recent times, scammers have taken advantage of ICO by creating fake tokens with no asset or substance to back their credibility. This has led to many abandoned projects, which has made investors lose a lot of money. This gave birth to the use of IEO as a means to raise funds by developers and companies in the cryptocurrency space.
What is a cryptocurrency token?
Cryptocurrency Token is a type of digital commodity which represents an asset. It operates on an existing blockchain as a smart contract, so a crypto token does not have its own blockchain.
How to create a token
Creating crypto tokens might look complex; it might look like a task that requires programming experience, but creating a crypto token is easier than you think. There are a lot of readymade user-friendly apps that allow anyone, including people with no programming knowledge, to build their token.
Tokens are easier to build, and it's not compulsory to make them public. You can create your token for yourself, your family, and your friends.
- Crypto tokens can be created on the Bitcoin blockchain by a process called Bitcoin forking. Bitcoin forking is the process of changing the codes of bitcoin or modifying the protocols of the bitcoin network in other to create new tokens.
- Crypto tokens can be created on the Ethereum blockchain. Ethereum request for comment protocol (ERC-20) was launched due to people's difficulties when using bitcoin forking to create a new token. Ethereum blockchain is faster, and it helped skip a lot of technicalities for developers. It opened a new way to make tokens because of its flexibility, speed, and easy-to-use features.
- Crypto tokens can be created from scratch by creating a blockchain for the token.
How to launch a cryptocurrency token
Crypto tokens can be launched in different ways, but the popular ones are ICO (initial coin offering) and IEO (initial exchange offering).
How to launch crypto token through ICO
Initial Coin Offering (ICO) is raising funds by startups and companies in the cryptocurrency world. It's similar to IPO's (initial public offering). Investors interested in the project will give in funds to the startup and receive crypto tokens belonging to the startup in return.
The token represents utility, value, service, or stake in the company. ICO's can only be purchased via another cryptocurrency.
How to launch crypto token through IEO
Initial Exchange Offering (IEO) came to the limelight as the case of scamming and misuse of the ICO became rampant. IEO brings a readymade token with a readymade exchange platform for the token to thrive. IEO is similar to ICO, but then, it's better and durable than ICO because an exchange platform backs it.
Conclusion
Though IEO might look fantastic, there's nothing perfect 100%. The fate of IEO tokens strongly relies on exchange platforms, and developers can bribe exchange platforms in other to be listed. The validity of crypto tokens listed on exchange can't be 100% guaranteed as a profitable or valid token.
Investing in a crypto token project requires deep scrutinizing and research, the team behind the project, road map, and white paper. Above all, a token with an exchange platform from the start is safer.
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Richard Alagbe
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