Saturday, October 1, 2022

Step by step guide on developing your own cryptocurrency

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Cryptocurrencies are predicted to replace fiat money in the coming decade. It probably sounds too wild to be true- but it won’t be too exaggerating to expect that by 2030, cryptocurrency would probably enjoy the same status as that of a fiat. In fact, Bitcoin, the #1 crypto has already received legal tender from two countries. Bottom line is – cryptocurrency is rising fast. In such a scenario just imagine how amazing it would be to have your cryptocurrency! It would be like owning a fragment of the magic wand that probably will define the face of the economy in the near future. Oh boy! Isn’t that thrilling? You bet! But before that, you should know how to create cryptocurrency.

We will discuss in detail all the steps that are required to create cryptocurrency. But, before we proceed to the guide about developing cryptocurrency, let’s have a look at the multi-faceted advantages of having your own crypto.

Top reasons to have your own crypto

Leverage for your brand

Your own cryptocurrency will certainly keep your brand ahead of the curve and do wonders to your branding efforts.

Fraud prevention

This is one of the main reasons to create cryptocurrency.

Crypto transactions cannot be revered- nobody can counterfeit a cryptocurrency transaction. This cutting-edge infrastructure will add an additional layer of security to your brand and payment transactions. Put simply, if you can create cryptocurrency for your brand, your customers will feel more secured to execute dealings with you.

Faster and affordable transactions

If you are acquainted with cryptocurrency, you are aware that crypto transactions are decentralized and hence do not incur 3rd party fees. Thus, if you create cryptocurrency, you will be able to enjoy way lesser transaction costs than with regular currencies. Moreover, thanks to the decentralized nature of cryptocurrencies, the transactions will be faster than ever.

Easier access to international markets

Have you been aspiring to reach out to international customers but apprehensive of the high cost of international transactions? Well, you can get rid of such worries if you create cryptocurrency. The value of a crypto is always universal. On top of that, crypto-based transactions don’t incur high transactional fees on international or any kind of transactions.

Step-by-step guide on developing cryptocurrency

Select consensus mechanism

The primary step to create cryptocurrency is to choose your preferred consensus mechanism. In fact, your choice of consensus mechanism will decide what kind of blockchain platform you will need to create cryptocurrency.

Consensus mechanisms refer to the protocols that enable participating nodes to determine the legitimacy and validity of transactions. The consensus mechanisms come to play especially when blockchain platforms have to verify new blocks before adding them to the chain.

The traditional consensus mechanism is Proof-of-Work. However, the contemporary digital asset industry is focusing more on Proof-of-Stake consensus mechanism as it is more eco-friendly and faster compared to PoW. It’s advised that you choose the PoS mechanism when you aim to create cryptocurrency.

New or existing blockchain?

Cryptocurrencies are developed on blockchain technology.

So, the next step to create cryptocurrency is to build your blockchain. Now, you can develop a blockchain platform right from ground zero. But that demands high-tech coding skills, enormous time, and huge amounts of money. Would you be able to accommodate all these to create cryptocurrency? If your answer is “yes”, just go for it.

But not every crypto enthusiast out there is able to develop a whole new blockchain platform right from ground zero. In that case, the option is to create cryptocurrency over an already existing blockchain

Develop nodes

This is one of the most important steps when you have plans to create cryptocurrency.

Nodes are the blood and soul of a blockchain network. They are the founding bricks that shoulder all the tasks needed to keep the blockchain running. These could be anything and everything ranging from data storage to verification of transactions, and so on.

Here are the factors to keep in mind while developing nodes to create cryptocurrency

  • They type of permission for the node
  • Hosting platform- on-site or cloud or hybrid?
  • All the essential hardware details
  • What would be the base OS?

Develop internal architecture for blockchain

The next step to create cryptocurrency is to design and build the internal framework of your blockchain system. Make sure to run the blockchain on testnet first before launching the final mainnet. You won’t be able to change even a single thing on the blockchain platform after you have already launched the mainnet. So, please be a little more careful since you have plans to create cryptocurrency. Here are the parameters that you must check prior to launching the mainnet-

  • Permissions and level of access
  • Key formats
  • Format of addresses
  • Asset issuance and reissuance
  • Multi Signatures
  • Key management
  • Rules for native crypto
  • Rules for nodes on identifying one another
  • Block side
  • Block rewards
  • Limits on transactions

Consider APIs

When you plan to create cryptocurrency on an existing blockchain, you have to check beforehand whether that particular blockchain platform offers pre-set APIs. You must know that every other blockchain out there might not provide APIs. But if your chosen blockchain network is not extending APIs, you can get APIs to create cryptocurrency from 3rd party providers.

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Create user-friendly interface

You need to be careful about the interface when you aspire to create cryptocurrency. If the interface isn’t exactly user-friendly, your coin might earn a bad rap. Below are the factors that you must take care of while developing the interface to create cryptocurrency

  • External databases
  • Mail, FTP, and web servers
  • Programming and front-end languages

Make sure to deploy upgraded external databases.

Check the legality factor

Crypto is still an unregulated territory. But, governments and financial heads all across the world are working towards establishing a legal infrastructure for cryptocurrencies. In that light, we might witness the development of regulations for crypto in the near future. So, study trends regarding the crypto regulation sector to keep yourself updated about the decisions and actions to be taken about crypto legitimacy. It will help to ensure that your crypto won’t project towards an ugly surprise when the regulations will come to place.

Development of crypto projects can be an exorbitant affair. But you can always count on ICOs and other crowdfunding projects to fund your crypto.

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