The basic answer to the question of ‘can you make your own cryptocurrency’ is yes. There are several ways in fact that cryptocurrencies are made and you can choose whichever one you want. Provided you have the right knowledge and resources, of course.
For those interested, we’re going to break down the four ways you can make your own cryptocurrency, from the least to the most difficult.
- Hire a Blockchain Developer to Create One for You
- Make a New Crypto on an Already Existing Blockchain
- Modify the Code of an Existing Blockchain
- Create Your Own Blockchain Cryptocurrency
Option 1 - Hire a Blockchain Developer to Create One for You (Least Difficult)
If you don’t have enough know-how or the correct resources and software needed to create a new crypto, then you can take the easiest option which is to throw money at the problem.
Hiring a blockchain developer to do all the work for you solves every issue you have and leaves you with the same result as someone who did it themselves.
By hiring a blockchain development company, you can create a new coin or token that has any degree of customization you want.
There are companies in place that have been set up for the sole purpose of creating and even maintaining digital currency on behalf of other people. These companies are called blockchain-as-a-service (BaaS) companies.
These companies can also be used if you need help launching a coin or currency on an existing blockchain platform.
Some of the more high-profile Baas companies include:
- Microsoft Azure
Option 2 - Make a New Crypto on an Already Existing Blockchain
You don’t need to create a new blockchain or modify an existing one in order to create a new cryptocurrency. For example, the Ethereum blockchain is designed to host cryptocurrencies from any number of different developers.
If you create a crypto on an existing blockchain, the result would be that your creation is classified as a token. Since this is a digital currency that isn’t native to the blockchain on which it operates.
You will need a certain level of technical knowledge and expertise to create a new token on an existing blockchain but the process is simple enough that only basic know-how is necessary.
Below you can find the steps you need to follow if you want to create a new token on an existing blockchain.
Choose the blockchain platform you want to use - Binance Smart Chain and Ethereum are common choices
Use software such as WalletBuilders or something similar in order to create the token. This type of tool will guide you through the making-process easily and allow you to customize your token how you want.
Now your token is complete, it’s time to mint. Using a platform like Binance Smart Chain or Ethereum will mean that you probably won’t need the services of a professional auditor or lawyer before issuing a batch of tokens.
While tokens aren’t as customizable as coins, they are faster, cheaper, and easier to create. Your token will still benefit from the security of the blockchain and any other features used on that platform.
Your token will also benefit from the credibility that comes with using an established blockchain.
Option 3 - Modify the Code of an Existing Blockchain
If you would prefer to create a new blockchain and in turn, a native currency to your new blockchain, then you’ll need to use the source code of an existing one to set it all up.
You’ll need a greater degree of technical knowledge if you choose this option as you won’t just be able to download software that will hold your hand through the process like with option 2.
Anyone can view and download the code for blockchains since they are open source. You can find the source codes on the GitHub platform.
After you have downloaded the source code, you’ll need to get in touch with the blockchain auditor to talk through the legal side of this process.
Once you have the permissions required and understand the legalities, you’ll be allowed to mint your new crypto through your modified source code.
Option 4 - Create Your Own Blockchain Cryptocurrency (Most Difficult)
Warning, you’ll need a fully-functioning technical head to do option 4, writing your own code to create a new blockchain and native currency isn’t just a few clicks of the mouse.
You’ll need technical training, coding skills, and a full understanding of how blockchain technology works.
While this takes the most work and is by far the most difficult option, you have the most freedom with how the final product turns out and can create something truly innovative.
Native coins are considered better than tokens so you also have a better chance of attention and success with this option. If this is the option you want to try, then here’s what you’ll need to do.
A blockchain’s operating protocol is also known as its consensus mechanism, so it’s time to choose the consensus mechanism for your blockchain. The most commonly used consensus mechanisms are proof of work (PoW) and proof of stake (PoS).
Now it’s time to design the architecture of your blockchain. You need to ask yourself some important questions such as: should it be permissioned or permissionless? Should it be private or public? The answer to these types of questions will depend on the reason you’re creating the crypto in the first place.
Next up, it’s time for auditing for both the blockchain and code. If this is beyond your scope of understanding, then it’s advisable to hire a specialized blockchain auditor to review your blockchain’s code and identify the vulnerabilities.
Before you can finish up, you need to check out the legalities of what you’ve created. Before minting, pay for specialized legal advice to ensure your crypto is compliant with all relevant laws and regulations.
And minting can finally begin. You’ll need to wisely decide how many you're going to initially release and how many can be minted in total.
What Are the Pros and Cons of Making a Cryptocurrency
Pros of Making a Cryptocurrency
- You have full control over the customization of the cryptocurrency
- You can learn more than ever about blockchain technology
- If your crypto is successful, you can end up with a lot of zeros in your bank
Cons of Making a Cryptocurrency
- The amount of technical knowledge needed often excludes a lot of people
- The amount of time and money you spend setting it up won’t have any bearing on its success
- The ongoing maintenance needed after release can be incredibly time-consuming
Important Things to Know Before Making Your Own Cryptocurrency
While creating a new crypto can just be for fun, one that has any hope of success requires a lot of time, money, knowledge, patience, and resources.
Making it is the easy part, making it successful and maintaining it is a huge challenge.
If you are wanting to create a new token or coin just as a hobby or experiment, then you’re not going to have any problems since you won’t have any expectations.
However, be sure to avoid any activities that might be considered an initial coin offering (ICO) by the U.S. Securities and Exchange Commission. You don’t want to accidentally violate any federal securities laws.
Frequently Asked Questions About Making Your Own Cryptocurrency
Can I Make My Own Cryptocurrency?
Yes. Essentially, as long as you have the knowledge and resources, anyone can make their own cryptocurrency. You have four main options for setting up your cryptocurrency, all of which are detailed above in this article.
How Much Does it Cost to Make a Cryptocurrency?
The answer to this will entirely depend on which option you pick and how customized you want your coin or token to be. The more customized it is, the more expensive it will be. However, programs like WalletBuilders are free to use and you can create a standard token on an established blockchain for minimal costs.
Is Creating a Cryptocurrency Legal?
It’s vital you check the cryptocurrency laws in your own country before setting a new one up. Some countries in the world have banned crypto outright and you would, therefore, be breaking the law by creating a new one.
If cryptocurrencies are legal in your country, then as a general rule, creating a new one is legal also. However, check and double-check before starting the process.
Can I Get Rich from Creating a New Cryptocurrency?
There is no guarantee that you will get rich by creating your own cryptocurrency. Some people have had great success with their coins or tokens while others have not. Like with investing, creating new crypto is a risk that you have to understand.
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