Investing in cryptocurrencies is only half of what you can do in the crypto space. You can also create your own cryptocurrency coin or token.

There are several ways to create a crypto token/coin. You can either write the code yourself or develop a coin without coding. 

Creating a crypto coin can be difficult, especially the first time, so let’s walk you step-by-step on how to create your first cryptocurrency token in different ways.

 

Difference between a coin and a token

Taking a detour before the main action, let’s quickly address the difference between a crypto token and a coin.

While often used interchangeably, crypto coins and tokens have distinct characteristics:

Coins:

• Operate on their own independent blockchains (e.g., Bitcoin, Ethereum).
• Primarily function as mediums of exchange or stores of value.
• Have a limited supply controlled by the blockchain’s protocol.

Tokens:

• Built on top of existing blockchains (e.g., ERC-20 tokens on Ethereum).
• Represent diverse utilities, like access to specific services or platforms. (e.g NCDT and RNDR for decentralised cloud computing )
• Supply varies depending on the token’s purpose and design.

In essence, coins are native currencies of their blockchains, while tokens leverage existing blockchains for various functions.

 

How To Create A Token

There are four ways you can create a crypto token.

1. Create Your Crypto Token By Writing The Code

You can write the code for a new blockchain to create your own token. However, you will need a lot of technical knowledge in blockchain and cryptography. This is undoubtedly the most difficult method among all four because you have to be a programmer and an expert in writing crypto smart contracts.

However, if you have mastered the technical aspect, this method gives you the most control over your token and how it will work. Creating a blockchain for your token is the best option, especially if you are a token creator with big, innovative plans.

Choosing a good consensus mechanism is important, which is the agreed process by which new information(transaction) is added to the blockchain. The most common consensus mechanisms are proof-of-stake (PoS) and proof-of-work (PoW). 

For sustainability and speed, PoS is the better option. If you want to create a cryptocurrency token this way, make sure to check the legal aspects carefully..

 

2. Create Your Token By Modifying The Code Of An Existing Blockchain

Another way to create your own token is to use an existing blockchain’s source code. It is similar to the first; you need technical expertise, but you have less work to do in this case as you won’t need to write the code from scratch. 

Most codes for blockchains or cryptocurrencies are open-source, meaning you can view and download them. Popular sites where you can find open source code repositories include Github, Stack Overflow, Bitbucket, and SourceForge.

Once you have found the correct source code, you can tweak it to fit your token requirements. Here, you can consider, for example, mining or burning the token to reduce supply. You can also fix the total token supply.

 

3. Create A New Crypto Token On An Existing Blockchain

Another method, which is an easy one, is to create a new crypto token without creating or modifying a blockchain. This doesn’t require much technical knowledge, and you can even find tutorial videos on YouTube that teach you how to create a token on different blockchains.

Blockchains such as the Ethereum blockchain, BNB Chain, and Solana allow anyone to build any crypto token on the blockchain and have access to the unique features of that blockchain, including transaction speed and consensus mechanism. 

You must first choose the right blockchain that suits your vision. Bitcoin, Ethereum, Solana, and the BNB Smart Chain are popular examples of this. Next, you can customize your token to meet all your needs. 

Having your token associated with a reliable blockchain can positively affect its value and reliability, but nothing is guaranteed.

 

4. Create A Token By Hiring Crypto token development services

If you are the one with the vision but lack the technical skills to carry it out or you lack the time and energy to do the job yourself, consider hiring crypto development services. Companies with the knowledge, workforce, and expertise offer these services to take the work off your hands.

They will create the token for you, which can save you a lot of time. Besides creating the token, they can also write a whitepaper for you and arrange an Initial Coin Offering (ICO). The disadvantage of this method is that it can be quite expensive.

 

How To Create Crypto Tokens On Different Blockchains

After drafting your plans for your token, the next thing to decide is which blockchain the token will be built on. The blockchain you choose has a very important role in the growth of your project, and the kind of token you are creating still has a determining factor regarding which blockchain to use.

Every blockchain has its disadvantages and advantages. Some may be fast but less secure like Solana and some may be more secure but a bit slow in processing transactions like Ethereum. Solana requires only one confirmations hence the speed and less security while Ethereum requires over 30 confirmations, hence the high security and less speed.

It is wise to use a blockchain that is in-between and famous; a popular blockchain will create more visibility for your token.

Nonetheless, let’s take you through a step-by-step process to create a token on one of the most popular blockchains.

 

How To Create A Token On The Ethereum Blockchain

Tokens created on the Ethereum blockchain are called ERC20 tokens, where ERC stands for Ethereum Request for Comments. 

Many crypto projects create tokens on the Ethereum blockchain because of its security and popularity as the second most popular blockchain. 

Here’s a step-by-step guide on how to create an ERC20 token.

1. Token specifications

The first thing to do is write down the specifications for your token. Here, you give your token an identity and create some fundamental layers of the token.

Token specifications to consider while creating a new crypto coin include:

• Name (examples are Ethereum, Solana, Avalanche)
• Ticker is the acronym for the token (examples are ETH, BNB, SOL, etc.)
• Tokenomics, like the total token supply to be in circulation, and the token distribution model.
• Digits- how many numbers can be put after a decimal (e.g., 18.105, 0.00000534) 

2. Coding the smart contract

The Ethereum blockchain has a programming language called Solidity, a widespread programming language for writing smart contracts.

To create an ERC-20 token, you need to code in Solidity. You don’t need to have in-depth technical knowledge, as some programs can give you a template, and all you need to do is replace specific features with the ones you provided in your new token specification. You can find these templates on crypto repositories on GitHub.

3. Testing the token on a testnet

The next phase is testing on a testnet. Testing on a testnet is to check for defects in the smart contract. To test your token, you must use a good wallet. Some of the best wallets include MetaMask and Trustwallet. When you test your new token, the system checks for any defects. 

This process is fast and free. You will carry out the entire process as you would if the token were live, but you will be using testnet tokens to pay for gas.

4. Verify the token source code.

The final step is to verify your code. This phase is very important because it allows you to build and launch a completely transparent project. You can use the “match and disclosure” option in the contract code. 

Ensure all data is correct so the contract source code can be verified. Then, you must upload your token to the blockchain mainnet and open it up to other crypto users.