How to Create a Cryptocurrency : A Quick Guide for Beginners

Ethereum, a prominent cryptocurrency that started at 1.25 USD in 2015, is now at 2,520 USD as of June 14th, 2021. And as you check this graph with the prices skyrocketing tenfold, creating your own billion-dollar cryptocurrency seems to be a profitable and promising idea on the surface.

Source: Statista

Many apps now have blockchain-based payment methods – cryptocurrency token options, to be precise because they make the transactions more secure and private.

If you have an app (or an app idea), you can make a token that goes with the app, but it involves a steep learning curve. Here is our quick guide on the subject to make things less complicated as you make your first cryptocurrency token.

Note that before you begin making the token, you need to evaluate your current understanding of cryptocurrency and decentralized technologies like blockchain. Plus, you should already be aware of your purpose behind the creation of this currency.

So, what is cryptocurrency?

Cryptocurrency is a digital currency based on blockchain technology – a decentralized ledger of data handled by a network of computers.

Basically, these are transferable digital assets, encrypted (into automated codes) by the systems of monitoring computers. Like a state bank or government, a central authority can’t regulate the movements, creation, destruction, or uses of these digital assets.

5 Things to Know Before Making A Cryptocurrency

As you move ahead with the creation of your cryptocurrency, here are 5 things you should know:

• 1. People have different purposes for making their own cryptocurrencies. While some may simply want to add another secure payment method to their business, others want to earn money by offering their cryptocurrency for trade.

Now, ask yourself why you are creating this cryptocurrency.

• Do I want to add an alternate payment method for my customers?

If yes, you need to further answer if you would stay in the same business or follow the same model for at least 4 years from now. After this, consider your target buyers to design a cryptocurrency token that your sellers can easily access and exchange.

• Do I want to market my cryptocurrency as a trading asset?

If yes, ask yourself if you can market your cryptocurrency to make it profitable. You’ll have to apply for crowdfunding, build people’s trust and get the narrative across single-handedly.

• 2. You can choose to create coins or tokens – the parts of cryptocurrency that people actually use as a medium of exchange, buying and selling goods, and making capital gains on investment.

• 3. Creating tokens is easier because tokens are based on existing blockchain. For example, you can choose to create tokens on Ethereum. This idea sits well if you only offer your cryptocurrency as a payment method for a product or service you are selling. You can create tokens and integrate them into the payment channels of your website or application. While this guide will teach you how to make a token, you’ll need your app developer’s help to integrate the idea with your app.

Advantages of Cryptocurrency for Businesses

Here are four good reasons why you should consider integrating a crypto token in your business app:

1. Decentralization and Independence

Cryptocurrency is decentralized, and owners can manage these digital assets independently. Governments (local or international), central banks, or other authorities can’t regulate or intervene in how users trade or exchange these assets.

2. Low Transaction Fees

Because cryptocurrencies are not regulated by any central authorities, you or your buyers won’t have to pay third-party transaction charges or wait for days to send or receive payments.

3. Unlimited International Transactions

There are currently no daily, weekly, or monthly limits on how many coins or tokens you can transfer. So, if you are using tokens for your business, there will be no downtimes in payment limits.

1.224 million transactions were made in Ethereum on June 15^th, 2021. This is a clear indication that the global acceptance of cryptocurrency transactions is increasing every year.

Source: YCharts

4. Transparency, Security, and Privacy

Because these currencies are decentralized, only you and your buyer will know the details of the transaction. Whether transactional or non-transactional, any middleman can’t access the information because it is encrypted on the blockchain.

Disadvantages of Cryptocurrency for Businesses

But then, there are disadvantages of using cryptocurrency, too, and businesses should consider investing their time and money in the process.

1. Volatility and Risks

Cryptocurrencies are highly volatile and sensitive to local and international situations (legal, political, economic, etc.). So, people wanting to earn capital gains from crypto can still exploit the mechanisms. But, if you are using it as a payment method in your business, you may have to face serious operational and revenue losses because of fluctuation.

2. Payment Acceptance

You may end up losing business contracts if crypto is the only payment method you plan to provide. Since not many businesses worldwide deal in crypto, you may have to make abrupt changes to arrange payments.

3. Non-reversible Transactions

Crypto transactions are non-reversible. Therefore, this is still not as secure of a payment option as PayPal, credit, or debit cards.

4. Rigid Storage Options

When we consider privacy, anonymity, and security advantage, think of this other way round. You can’t access your wallet and whatever no. of tokens you have stored within if you lose your private key (password). Suppose you miss your associated credentials or the device. In that case, especially if it isn’t synchronized across your systems, you will have no way to withdraw your business money.

How to Make A Cryptocurrency Token 

We suggest users create their cryptocurrency tokens on Ethereum (ERC20) because it is convenient and less time-consuming. The code functions we have provided in the tutorial below will help you create tokens to integrate with payment methods.

Here’s is a step-by-step tutorial:

• 1. Download the ETH Wallet app.
• 2. Open the wallet app and on the top-right corner, click ‘Contracts.’
• 3. From the list, select ‘Deploy New Contract.’

4. Copy this code and paste it into your New Contract field.

contract MyToken {
/* This creates an array with all balances */
mapping (address => uint256) public balanceOf;
}

A new window will open like this.

4. Now, add this code under the last code you had entered.

function MyToken() {
balanceOf[msg.sender] = 1000000;
}

The supply is capped at 1million right now. Though, when pasting the code, you can make any changes as you like.

• Navigate to the right of the solidity box (where you are entering the code) under ‘Select Contract to Deploy.
• Open the drag and drop menu and select ‘My Token.’

Your cryptocurrency is ready!

Now what?

Once you have made your cryptocurrency, you can use software programs like Rinkeby, MetaMask, and Remix to test their working, check balances of tokens, and transfer protocols.

Wrapping up…

For beginners in blockchain, this tutorial can form a solid foundation in creating cryptocurrency tokens. Suppose you have bigger ideas to deploy blockchain technology or ERC20 tokens as payment sources for your business.

In that case, you can expand your plan onto the same narrative and create larger smart contracts. These are secure, offer low transaction costs, and attracting the public’s attention each passing day.

With the overall trends and hype surrounding the currency, we expect to see more and more developers implementing blockchain technology into multiple app features and user journeys.