Latest news about Bitcoin and all cryptocurrencies. Your daily crypto news habit.
-
Many new cryptocurrencies are trying to create money by applying a new technique called initial coin offering.
-
These upcoming new cryptocurrencies need to clearly specify their proposed purpose to the investors and the SEC, who are getting more involved in ICO.
-
As this industry evolves, regulators are gradually getting involved with the intention of securing the potential investors from the scam.
Research reveals that a lot of cryptocurrencies have failed, turns out the process of creation is not as simple as it may look, is time-taking and there’s a high possibility of failure.
If you are passionately observing the cryptocurrencies and wondering if you could invent your own cryptocurrency, the answer is Yes. But wait, there are a few things that you definitely need to know before you start your development.
First of all, understand this that only being a perfect coder will not help you in succeeding in the cryptocurrency world, following are a few steps that will help you to succeed.
How is a coin different from a token?
Yes, you got that right. It is vital to know the variance between a coin and a token. Both of these are cryptocurrencies but a coin – like Bitcoin, Litecoin, etc. works on its own underlying Blockchain. While a token exists atop an existing Blockchain like Ethereum.
A coin represents a monetary transaction while a token represents a “contract” for anything and everything. Another difference is that coins have their own autonomous ledger for maintaining transactions while tokens depend on the underlying blockchain’s technology to verify and protect the transaction and ownership.
Use a community to nourish and support your cryptocurrency
If you are thinking that, first, you will develop the currency and then look for a community to support, it; then it’s a completely wrong notion. Rather it’s vice versa. The first step of creating a digital currency is to narrow down on the community to support and help in the flourishing of your cryptocurrency.
Such communities have experts in finding loopholes in the security, avoid the threats, vulnerabilities and enhance protection against such threats. Such protections will give your coin legality and trust in the eyes of the world, something that is difficult to achieve. People are more interested in their own benefits and are submissive audiences.
Code for the big picture
Shockingly, developers think that the cryptocurrency coding is typically the least time-consuming part of the process and that it can be done quickly. Just because C++ is commonly known, doesn’t mean that anyone can successfully launch their own cryptocurrency. Some currencies don’t last long because they include features that get them the short- term attention but when it comes to longer-term management, they don’t last and fail.
The promise that you make at the launch is to be kept till the end and also to school people about the involved risks and how to keep their money safe. If you don’t do this, the mining of the cryptocurrency will drop as will the downloads.
Develop your own blockchain or bifurcate an existing one
Both of these methods of developing or bifurcating need an intense technical knowledge. Cryptocoins need their own blockchain and hence you need to create a new blockchain or modify an existing one for your new cryptocurrency. For the former, i.e. creating a new blockchain, you have to have the needed technical skills and knowledge; even though there are tutorials to help, they too assume that you have the basic knowledge.
Alternatively, you can use existing blockchain codes from open source found at GitHub – for example Litecoin – making a few tweaks for your need and launching the blockchain with a new name. Again, here also you will need to know and understand the code, then and only then will you be able to make the desired changes.
Know your buyers and sellers:
Let’s say that you have analyzed a good cryptocurrency, formed the perfect team to implement and nourish it in its way. You have advertised your cryptocurrency in the right tone on the forums and there’s a good number of miners vigorously working to grow your currency. Now, it is time to do the marketing so that the miners have a place to spend your new currency.
This is not as easy as ABC. Nevertheless, you need to convince people that the currency that you have developed is safe and trustworthy and that it can be dispensed for the customary money. Thus, it is a process of building confidence and doesn’t happen overnight. It takes good management and time to make people believe in what you believe and represent.
The important step towards building trust is to find the precise spectators. Hence, you can start with the cryptocurrency market, here people know what cryptocurrencies are. Hence you get to know the reaction. Based on this, you can further market it to people and influence them to use your currency.
End of the Line:
In order to create a cryptocurrency with actual value for a bigger audience who will buy, sell, and mine the currency; you need to have the right team of experienced coders, miners, and marketers. This will need a good amount of initial investment because you have to create the infrastructure, develop, stabilize and even maintain it.
The technical creation of your currency may not be the hardest part but making people trust and mine it, definitely is and that’s the real work. Many cryptocurrencies failed, even at the legal point of view, hence getting your currency legalized is also a challenge which must be overcome.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.