Creating a cryptocurrency, carrying out an initial offering, and bringing the created coin or token to the exchange are tasks that crypto startups and we, developers, usually deal with.
With that, most people think creating a cryptocurrency is not a big deal at all and one only needs to find a couple of experienced programmers. However, 99% of such cryptocurrency (if they even make it to the release) are doomed to fail and will never pay off. The development of successful crypto projects capable of making their creators wealthy and famous always involves teams of experts of different specialities that work shoulder to shoulder to achieve the common goals.
|Project concept and White paper development||On average, developing a proper concept and White paper costs some $5000–8000 and takes about a month.|
|Legal and financial matters||You will need to register legal entities, draw up legal documents (including the Legal Opinion), and open accounts in the appropriate financial institutions. The end-to-end legal preparation journey may take up to a few months. Good news: you can set up the legal framework concurrently with arranging technical matters.
We recommend allocating $8,000–16,000 to this stage.
|Technological matters||Developing the coin protocol, deploying nodes, creating wallets and a website will jointly take around $50,000.
You can save some $15,000 if you create your tokens based on the Ethereum blockchain. However, this may entail some inconveniences.
|Initial offering (ICO, IEO)||It is safe to allow $50,000 to initial offering-related processes.
You will have to pay 10–25% of the generated income for the initial exchange offering and 2–10 BTC for getting listed. Please remember that exchanges set extremely severe requirements when selecting candidate projects. You will need a promising concept, comprehensive development plan, MVP, established legal basement (including the Legal Opinion), practised team, and brilliant-reputation advisers.
|Entering crypto exchanges, market making||Depending on the popularity level, there are three types of exchanges:
Make sure the exchange is present at Coinmarketcap.com and CoinCap.io !
Financial regulators of states seeking to streamline the crypto market have already developed guides that classify crypto assets:
Despite some terminological differences, those authorities divide cryptocurrencies into three groups:
British regulator FCA has an additional requirement regarding stablecoins. As stipulated, if stablecoins are backed by certain assets or a basket of crypto assets, they may be recognized as e-money. That said, they will be placed alongside fiat currencies of electronic payment systems (e.g. PayPal and Worldpay). This may cause even more confusion, especially because stablecoins are not coins (despite what the word ‘coin’ suggests) but utility tokens.
A proper concept and being aware of the specifics of different jurisdictions are advantages that may help avoid a ton of problems. Creating tokens in the US and for the American market, be ready to become a target for the Securities and Exchange Commission. Below is the list of companies and cryptocurrencies involved in SEC-initiated litigation during 2021:
|Date||Company (cryptocurrency)||Funds raised ($)||Status|
|December 2021||Unikrn, Inc. (UKG)||31 million||Civil penalty of $6.1 million|
|November 2021||ShipChain, Inc. (SHIP)||27.6 million||Civil penalty of $2.05 million|
|September 2021||GTV Media Group, Inc., Saraca Media Group, Inc. (G-Coins and G-Dollars)||34 million (+339 million from the stock offering)||Settlement; disgorgement, civil penalty, and prejudgment interest in the amount of $539.4 million|
|August 2021||Blockchain Credit Partners (mTokens and DMG)||31.6 million||Disgorgement and prejudgment interest in the amount of $13.1 million|
|July 2021||Blotics Ltd. (Coinschedule)||no info||Settlement; disgorgement, civil penalty, and prejudgment interest in the amount of $201,688|
|June 2021||Loci, Inc. (LOCIcoin)||7.6 million||Settlement; civil penalty of $7.6 million|
|April 2021||BitClave PTE, Ltd. (CAT)||25.5 million||Disgorgement, civil penalty, and prejudgment interest in the amount of $29.3 million|
|April 2021||Paragon Coin, Inc. (PRG)||12 million||Civil penalty of $250,000|
|January 2021||Blockvest LLC (BLV)||100 million||SEC initiated a claim (pending)|
|January 2021||Wireline, Inc. (WRL)||16.3 million||Civil penalty of $650,000|
A coin is a cryptocurrency created from scratch and based on the dedicated blockchain, or developed based on a fork of an existing cryptocurrency (e.g. Bitcoin or Ethereum). Coins have nodes to support the dedicated protocol, user community, and development team. Also, there is the term ‘altcoin’ (alternative coin) which means any cryptocurrency besides Bitcoin that had been the only blockchain-powered cryptocurrency until 2011.
Polygant’s blockchain developers have already crafted 5 coins of different complexity and are now working on 2 from-scratch coins.
To create a cryptocurrency, we take a relevant source code, adjust it, and carry out the compilation. Usually, the development of a cryptocurrency consists of the following stages:
|Rank||Name (ticker)||Capitalization, $||Market price, $|
|3||Binance Coin (BNB)||67,404,311,754||408.44|
What makes this token unique is that it doesn’t have its own blockchain or supporting nodes but is driven by an existing coin’s blockchain. Most often, Ethereum’s blockchain is used for the creation of tokens, though this function is provided in blockchains of many other coins (e.g. Omni, Tron). Despite tokens are designed to be used as an internal currency or mode of access to services/applications, first investors try to buy them out to resell on exchanges later. To create a token, one needs to craft a smart contract and embed it in a blockchain.
You should keep in mind an important feature of Ethereum-powered tokens: any transaction conducted on the Ethereum blockchain (including wallet-to-wallet transfers) are subject to a fee called ‘gas’ which is worth several ethers. Thus, to perform a transaction, the sender must have not only unique tokens but also ETH coins. And this is not always that comfortable.
It takes at least a week and $3,000 to develop a smart contract. The integration with web services and web wallet, as well as further token offering, are also worked out.
|Rank||Name (ticker)||Blockchain platform||Capitalization, $||Market price, $|
|1||Tether (USDT)||Omni / Ethereum / Algorand / TRON / Binance Smart Chain||78,737,079,914||1.00|
|2||USD Coin (USDC)||Ethereum / Solana / TRON / Binance Smart Chain / Fantom||52,459,486,633||0.9996|
|3||Binance USD (BUSD)||Ethereum / Binance Smart Chain / Avalanche||18,058,788,066||1.00|
|4||Shiba Inu (SHIB)||Ethereum / Binance Smart Chain / Solana / Terra||16,288,039,714||0.000030|
|5||Crypto.com Coin (CRO)||Ethereum||11,379,897,958||0.4509|
As you can see, some tokens are as well capitalized as coins.
Our developers have 4-year experience in producing smart contracts for tokens and creating blockchain-powered coins. Learn more about the turn-key cryptocurrency development.
For sure, you will have to build a dedicated website that will clearly convey the value of your crypto project to potential investors. What most projects stay with is a one-page structure which comes in very handy for awareness purposes. The main website and White paper language is English but often developers translate their resources into 4-5 popular languages. As a rule, the website comprises the following:
An initial coin offering is an event during which a token or coin is presented to investors. In simple words, ICO means creating a specific number of coins or tokens with the purpose of getting investors to buy them for more liquid coins (e.g. BTC or ETH) at the price set by the creator. Quite often, Ethereum-based tokens are used in this context as the Ethereum blockchain only requires developing a smart contract.
Once you’re done with creating a cryptocurrency and selling some through your website, you might wonder how people will trade new coins and how to expand the audience. To interest new investors and traders and engage them in trading, you need your cryptocurrency to be listed. Before listing your cryptocurrency, the exchange will require you to get through some preparatory procedures:
Since early 2019, the initial exchange offering has begun to conquer the crypto market. With that, ICO and listing held their positions but the market got itself an alternative solution for those creating cryptocurrencies and bringing them public. The initial exchange offering is kind of a hybrid of the ICO and listing. In other words, IEO is a token sale conducted on the exchange. One only needs to cooperate with a proper exchange. Crypto startup founders find a lot of advantages in this model, which include the following:
The most successful and liquid crypto projects that carried out IEOs in 2019 are:
Besides the ICO and IEO, other solutions facilitating the cryptocurrency supply were introduced, namely Security Token Offering (STO), Initial Airdrop Offering (IAO), Initial Fork Offering (IFO), Initial Miner Offering (IMO).
Want to get into all the nuances? Submit a request and we will explain everything in detail. And then together we will develop a strategy on creating a cryptocurrency from scratch and offering it on exchanges!