Make a Cryptocurrency Coin
As per the data derived in September 2022, over 21, 000 cryptocurrencies were available in the market for trading. However, it’s not at all surprising as you can make your own cryptocurrency pretty easily nowadays without even going through the hefty process of creating your own blockchain. The most successful cryptocurrency projects are those that involve high-end security to transfer the coins or tokens from one person to another or from one blockchain network to another and support major use cases with functionality.
Nevertheless, to create your own cryptocurrency coin you must be aware of a lot of things. Let’s put down the process step-by-step to make it easy for you to understand.
Let’s learn to make your own cryptocurrency
Research the use case of your crypto coin:
The first and foremost step in creating your own cryptocurrency is determining a use case for your crypto or digital currency that you are going to launch in the market. Cryptocurrencies can be used for a variety of purposes, including data verification, smart contract support, transfer of money, alternative wealth management, and smart asset management. Moreover, the cryptocurrency market space is evolving day by day, and so does its use cases. Since now developers face cut-throat competition in the cryptocurrency market space, they must opt for a unique use case that helps them attract more and more investors.
For instance, the Dogecoin (DOGE) cryptocurrency was created based on a prominent meme at that point in time. Another cryptocurrency with a unique use case and vision is IMPT a recently launched token that rewards cryptocurrency enthusiasts who want to decrease their carbon footprint and help the planet in some manner.
Choose a blockchain platform
The second important step in order to create your cryptocurrency coin is to select and opt for a blockchain platform to launch your cryptocurrency or token. Unless you don’t want to get involved in the hefty process of devising your own blockchain network, you must select from the existing ones. Selecting the right blockchain platform is of utmost importance to trace the records of each and every transaction and hold the transactions accountable. You have a plethora of blockchain networks to choose from, including Ethereum, Binance Smart Chain (BSC), NEM, EOS, and so on. Some of the most successful projects were launched as ERC20 tokens, including Uniswap, Tether, Aave, and Shiba Inu.
Choose a consensus mechanism
Another important step while you create your own cryptocurrency coin is selecting a consensus mechanism that aligns with your long-term goals and vision. There are various consensus mechanisms available, the most famous one which is used by Bitcoin is the Proof of Work (PoW), wherein miners are rewarded with a crypto coin if they solve a complex mathematical puzzle, however, this mechanism is computation-intensive. Another famous consensus mechanism is Proof of Stake (PoS), wherein miners work together to devise a block, while a random miner gets the reward. In the PoS mechanism, miners are required to prove that they own a huge portion or stake of the cryptocurrency they are mining.
There are other consensus mechanisms that have been recently developed like Solana’s Proof of History (PoH). Proof of History enhances the throughput of a blockchain network, further surging the processing speed of transactions.
Create the nodes
Once you have selected a blockchain network, you must start devising the nodes. Nodes can be defined as fast computers that connect to the blockchain to process and verify the transactions. Nodes are an important part of the network as they keep the currency and network running while sharing and recording the data that has to be added to the ledger. However, there are four key things to consider when creating nodes:
- Decide and determine who has access to the nodes because there are networks that keep their nodes public, while other networks keep their nodes private.
- You must determine and identify where the nodes are hosted as usually local nodes are preferred over the nodes hosted on a cloud network. As they can bestow on-premise support for computers that verify the transactions and act as nodes.
- Selecting which operating system is perfect for the use. Ubuntu and Fedora are usually selected as the developers can reconfigure and modify the operating system according to their cryptocurrency’s unique requirements.
- The final point to consider is choosing the hardware because the processing time of the transactions will depend on the hardware. Components, including GPUs, hard drives, processors, and RAM are required by the nodes.
Develop the internal architecture
It’s time to focus on the blockchain’s rules, parameters, and internal architecture, including its private and public key format, how the crypto asset will be issued, and permissions. There are three different architecture models that the developers can opt from, including centralized, decentralized, and distributed. In the centralized architecture, there is only one central node that receives information from multiple other nodes.
In the decentralized architecture model nodes share the data together on the blockchain. However, in a distributed architecture model, the blockchain network moves between various nodes, herein a privately distributed ledger permits the users to modify the ledger data. While in a publically distributed ledger permits the users to review the content of the ledger data.
