Bitcoin was the first decentralized cryptocurrency. It was a huge success, and there is still more growth in the blockchain ecosystem. Unfortunately, this does not guarantee that everyone’s attempts to create cryptocurrency will be wildly successful. Several companies that attempted an ICO failed to secure sufficient money or shut down after their launch.
You may effectively launch your coin by following this step-by-step tutorial on creating one.
1. Define Your Objectives
Please take a look at what you want your coin to do as a first step. Are you in favor of using it as a payment system? or an investment bank?
Please look at the issue your cryptocurrency will address that other cryptocurrencies do not.
This might help you create the USP (unique selling proposition) for your currency. For instance, developers created Bitcoin to serve as a decentralised alternative to fiat currency. On the other hand, developers created Ethereum as a framework to design decentralised applications.
After you have established your objectives, you must name your currency and design a logo. You’ll also need to write a whitepaper and a website. The website ought to describe your money and how it functions. On the other side, the whitepaper will discuss your idea in greater detail.
Could you make sure your website and whitepaper are both crystconcise, succinct, and devoid of technical jargon? People will only invest in your project if they can comprehend what it’s aiming to accomplish.
2. Create a consensus-building process
The creation of a consensus mechanism is the next step. This is how the blockchain state will be agreed upon in your coin.
Two main types of consensus techniques exist: proof-of-stake (PoS) and proof-of-work (PoW).
PoW: is the most widely used type of consensus mechanism. Bitcoin and most other cryptocurrencies operate on this basis. In a proof-of-work (PoW) system, miners compete to approve transactions and append blocks to the blockchain. The miner that adds a block to the network is paid in Bitcoin.
PoS: In contrast, miners are exempt from proof-of-stake competition. Instead, the system uses bitcoin-staking validators to certify transactions. The more bitcoin a validator has invested, the more value their vote is worth. One benefit of PoS over PoW is that it is significantly more energy-efficient.
3. Choose a Blockchain Platform for cryptocurrency
After deciding on your consensus strategy, you must choose your blockchain platform.
If you want to use a PoW consensus process, the Bitcoin blockchain is the obvious choice. However, there are a variety of platforms available if you want to adopt PoS, like Ethereum, Cardano, and the quick EOS.
4. Create the Nodes
After deciding on a platform, you must download the necessary files and configure a node. A node is a machine that keeps a copy of the blockchain and supports transaction verification and relay.
You must join a mining pool if you are operating a PoW system. A mining pool is a collection of miners who cooperate to dig up blocks and split the spoils.
5. Generate a Wallet Address for your cryptocurrency
The best cryptocurrency wallet option must be used to generate a wallet address once your node has been configured. People will transfer money here to purchase your cryptocurrency.
You can create a wallet address using internet service or computer software.
6. Design the Internal Architecture
The internal architecture of your coin must be designed as the following step. This covers the consensus algorithm, network protocol, and transaction format.
It would help if you also choose how many coins you will produce. The supply of your coins is this.
Here, it’s crucial to create a balance. If you produce an excessive number of coins, their value is probably relatively low. However, if you produce too few, customers might only be able to purchase some of them.
7. Integrate the APIs
It would help if you integrated the APIs after creating the internal architecture of your cryptocurrency. Thanks to the API (Application Programming Interface), different software applications can connect with one another.
For instance, you’ll need to incorporate the Bitcoin API if you want to employ a PoW system. Your cryptocurrency will be able to communicate with the Bitcoin blockchain. The Ethereum API must be integrated if you want to use a PoS mechanism. Your coin will be able to communicate with the Ethereum blockchain. Here is a list of the best blockchain APIs.
You’re almost ready to launch your coin once you’ve integrated the APIs.
8. Make Your Cryptocurrency Legal
Making your cryptocurrency legal is the last step, and there are procedures for doing so. You can Createa business and obtain a license from the government for this.
Your cryptocurrency must also be registered with the Financial Crimes Enforcement Network (FinCEN). This US government organization is in charge of preventing terrorism and money laundering financing.
Once you’ve completed everything, kudos! Your cryptocurrency is prepared for launch!
