How to Launch a Token on Any Blockchain?

If you believe in numbers, you would be baffled to hear that over 1.8 million cryptocurrencies exist in 2023, according to CoinMarketCap, the famous crypto data aggregation platform. While all of them are not in widespread use (some don’t even have tangible utility), those being popular are driving the crypto ecosystem’s growth. Despite such a humongous number of cryptos in existence, the demand for new cryptos does not subside, making crypto development a viable business option. This comprehensive piece provides information on how to launch a token on any blockchain with in-depth information sourced from industry experts. Let’s dive in!

Cryptocurrencies: Where Do They Stand Now?

According to CoinMarketCap, the crypto market has a capitalization of over 1.19 trillion dollars, and the figure has been increasing little by little. The top five cryptocurrencies based on market capitalization are Bitcoin ($BTC), Ether ($ETH), Tether USDt ($USDT), BNB ($BNB), and XRP ($XRP). Other notable coins include Polygon ($MATIC), Dogecoin ($DOGE), and USD Coin ($USDC).

The top five cryptocurrencies contribute over 380 billion dollars to market capitalization, almost one-third of the total market cap. Still, new cryptos make noise on the sidelines as trends change. Only those that live up to their hype and expectation thrive in the long term.

Classifying Cryptos into Coins and Tokens

If you are new to the crypto realm, you might have been confused by the intermingled usage of the words Coins and Tokens. While most use them interchangeably, doing so is factually incorrect. There is actually a fine line that differentiates crypto coins and crypto tokens, which we will see in the upcoming subsections.

Irrespective of the differences, both of them have contributed equally to the crypto ecosystem over the years, with numerous advancements expanding their scope in the mainstream world.

Crypto Coins

Crypto coins refer to the native currencies of blockchain networks that are used to pay for transaction processing and rewards for mining, staking, and validation. Bitcoin’s $BTC and Ethereum’s $ETH are pioneering examples of crypto coins while several others, such as $SOL (Solana), $ADA (Cardano), $MATIC (Polygon), and $AVAX (Avalanche), are gaining traction.

Since crypto coins are bound to a particular blockchain, creating one requires a lot of effort to develop a blockchain network before making coins. These are fungible tokens, meaning they can be exchanged for one another and divided into smaller units, like how we conduct transactions using fiat currencies.

Crypto Tokens

Crypto tokens refer to the digital tokens created on a blockchain. These can be categorized into fungible and non-fungible tokens. While the former is used for payments and crypto coin-like functions, the latter is used to represent ownership of digital and physical assets on the blockchain. There are even stablecoins, which are tokens pegged to fiat currencies or precious metals.

Popular crypto tokens include Tether ($USDT), Uniswap ($UNI), Maker ($MKR), and Axie Infinity ($AXS). These tokens can be used for utility, transactions, governance, and equity, increasing their versatility compared to crypto coins. Our blog will primarily focus on the creation of these tokens.

“As the value goes up, heads start to swivel, and sceptics soften. Starting a new currency is easy. Anyone can do it. The trick is getting people to accept it because it is their use that gives the 'money' value.” — Adam B. Levine, CEO of Tokenly.

Why Should You Develop a Crypto Token?

You can develop a crypto token to create an investment opportunity for people who trust your upcoming business and need exclusive access.

You can use crypto tokens to offer loyalty programs for your business, providing exclusive benefits to your close community and attracting the rest of them to get incentivized.

Such tokens can be utilized for payments like crypto coins but inside your business application, such as an NFT marketplace or a P2E game.

You can even mint crypto tokens based on the stablecoin mechanism to facilitate fiat-backed transactions, driving larger-scale adoption of cryptocurrencies.

Key Features of Tokens to Keep in Mind

While creating your own crypto token, you should consider implementing these features in mind:

• The blockchain used to mint your crypto tokens.
• The level of centralization or decentralization determined by the number of validator nodes.
• The level of transparency shown by how much information is accessible to an average user of your network.
• The consensus mechanism to be used for transaction validations such as Proof-of-Work (PoW) or Proof-of-Stake (PoS).
• The degree of security implemented in your crypto tokens to reduce malicious attempts to access cryptos and sensitive information.
• The speed at which crypto transactions are processed on the blockchain.
• The cost for processing crypto transactions on the blockchain (otherwise known as gas).
• Limitations you might impose on users, such as minimum and maximum transaction limits.

How to Launch a Token?

The General Process

1. Launching your crypto token begins with framing its idea in consultation with subject matter experts. Aspects such as technological elements, tokenomics, utility, and long-term feasibility are discussed and documented.

2. After this, the process moves to the development phase, where one of the two processes used in creating crypto tokens is employed. We will see more about each of them separately in the upcoming sections.

3. Now, we move to the phase of listing and promoting the crypto tokens. By using various strategies and partnering with exchanges and liquidity providers, you can build a trusted community supplemented by high token liquidity.

4. The token is launched to the public via a fundraising campaign or a sale on a crypto exchange.

The sections we will see below expand the second step in more detail, as there are two ways to develop a crypto token.

Differentiator #1: The “Ready-Made” Way

1. If you opt to create a crypto token using existing tools, the process begins by selecting the token minting platform.

2. Now, we enter the necessary information required to create the token, including the token standard, token name, number of tokens, maximum limit per mint, initial value, and more.

3. After paying the required cost for processing the token creation, your crypto tokens are created, which you can list on exchanges and launch for public use.

Differentiator #2: The “Hard-Core” Way

1. If you choose to develop your crypto token using the classic method, the process starts by coding the necessary programs.

2. These programs include smart contracts that contain all information about the token, including ones that we had seen in the above section.

3. The smart contracts are then tested extensively using multiple test cases, and defects are resolved promptly.

4. After testing is complete and marketing efforts are performed in parallel, the crypto tokens are launched on the blockchain for public minting.

Use Cases of Cryptocurrencies in Today’s Crypto Landscape

The modern-day crypto space has been full of innovations that include numerous use cases. While we might not discuss all those applications in detail, our blog will focus on the top use cases of crypto tokens.

Crowdfunding

Crypto tokens have been in widespread use for crowdfunding campaigns ever since Initial Coin Offerings (ICO) took the world by storm in the 2010s. Since then, there have been many crypto fundraising models, including Initial Exchange Offerings (IEO), Initial DEX Offerings (IDO), Security Token Offerings (STO), and Initial Liquidity Offerings (ILO).

Numerous projects have benefited from crowdfunding cryptocurrencies that could be coins or tokens. Ethereum, EOS, and Telegram conducted some of the notable crypto token offerings, particularly ICOs. Crowdfunding nowadays has become the way for startup projects to build a reliable community while raising funds to commence their missions.

Utility in Blockchains

Cryptocurrencies, mainly crypto coins, have been used widely since the initial days of Bitcoin. Blockchain-native coins can be used for paying transaction processing fees (often referred to as Gas) and incentivizing users to participate in processing them through mining or staking.

These coins’ flexible nature allows them to be utilized for in-app payments, making their equivalency to fiat currencies imminent. One should note that these tokens conquer the most places in the top 50 cryptocurrencies, establishing their role in the blockchain space. If you are planning to develop a full-fledged blockchain ecosystem, opting for a crypto coin can help you immensely.

Utility in Applications

Crypto tokens can be used for utility purposes in projects. Examples can include payment mediums, governance tokens, incentives, and equities. Platforms such as NFT marketplaces and Play-to-Earn (P2E) games can benefit big time from using native crypto tokens for transactions and rewards.

More projects have started creating crypto tokens to supplement their other ideas, such as business platforms and NFT communities. Creating such tokens also does not involve a lot of work usually associated with creating crypto coins for a blockchain. One should note that these tokens can begin as crowdfunding tokens before being enforced with utilities inside business applications.

Assistance to Noble Causes

Crypto tokens can be used to garner financial support for noble causes. Numerous projects have emerged to address pressing issues such as environment conservation, aiding war-torn regions, and social rehabilitation efforts. Using crypto tokens for the process makes it easier to raise funds from across borders with minimal intervention from centralized authorities such as banks.

It is essential for a project to create such crypto tokens to include real-world utilities for users that would make the community feel included in the project. With the prominence of cryptos emerging further, using tokens to support noble causes will become a mainstream use case.

“If crypto succeeds, it's not because it empowers better people. It's because it empowers better institutions.” — Vitalik Buterin, founder of Ethereum.

Can I Mint Crypto Tokens Without an Explicit Use Case?

Yes, you could mint crypto tokens without an explicit use case but with some underground works. Creating crypto tokens and pitching them to potential investors without a plausible use case is very challenging, given the long history of scam projects that had taken the route earlier.

Still, with appropriate promotions and proof to show work is in progress to deliver utilities, you can sell crypto tokens to people without including utility during the initial release. A road map, in this case, can benefit the project in convincing prospective investors to buy its crypto tokens.

Popular Blockchains to Create Crypto Tokens

With thousands of blockchains comprising the crypto ecosystem, one might find it challenging to choose the ideal blockchain(s) to mint their crypto tokens. This section serves as an aid for such people by discussing the top five blockchains one can look up to while minting crypto tokens.

Ethereum

Ethereum is the most used blockchain network when it comes to launching crypto tokens. Ever since its inception in 2015, the network has been at the forefront of a revolution that brought about numerous applications to crypto tokens, including the first non-fungible tokens that changed how we perceived blockchain technology.

We should note the Ethereum blockchain itself was built through a crypto fundraising campaign. The network also has the Ethereum Virtual Machine (EVM) that offers interoperable support to numerous Layer-1 and Layer-2 networks, expanding a crypto token project’s business scope. It also has a huge ecosystem of applications, developers, and users, making it the go-to network for token projects.

Tron

Tron is a decentralized blockchain network that has been in existence since 2018. The network has been popular for its focus on media-based applications. The network gained significance during one of the crypto bull runs, as many projects used Tron to create their tokens.

The network has faster transaction speeds and high scalability, an advantage that is difficult to achieve in some networks like Ethereum. Its usage of Delegated Proof-of-Stake (DPoS) consensus mechanism takes advantage of its community to decide which nodes will be used for validating transactions. Its provision for projects to conduct ICO campaigns on their own makes Tron an ideal candidate for creating tokens.

BNB Chain

BNB Chain (Previously known as Binance Smart Chain/BSC) is a network created by the globally famed crypto exchange Binance. The network functions in parallel with the Binance chain, which enables it to operate seamlessly and offer faster transactions at incredibly low costs. The blockchain is home to numerous crypto tokens that have a considerable presence in the market.

The BNB Chain is one of the most popular networks compatible with the Ethereum Virtual Machine, which enhances its interoperability, making it an excellent option for projects. The network has a complete ecosystem that allows projects to gain a reputation in the blockchain space.

Arbitrum

Arbitrum is a Layer-2 solution built on the Ethereum network that has gained momentum in recent times. The solution has become an alternative to the more established Polygon network, making it a go-to option for emerging projects. Arbitrum aims to scale up Ethereum’s smart contracts by boosting its scalability and speed alongside enhanced privacy.

The Layer-2 solution utilizes a mechanism known as Transaction Rollups to collect transactions in batches on-chain and process them in a sidechain. Although there are not many projects on the network currently, the future is promising as its developers work to upgrade the solution’s sophistication.

Polygon

Polygon is one of the earliest Layer-2 networks to be built on the Ethereum blockchain. The solution addresses some of the inherent challenges Ethereum faces, including slower transaction processing speeds and higher processing costs. The network also presents Supernets, a facility using which businesses can run their own chains on Polygon’s ecosystem.

With nearly 226 million unique addresses on the network, Polygon shows a lot of promises for startup projects aiming to create fungible crypto tokens with utilities. It is even testing its own zkEVM (Zero-Knowledge Ethereum Virtual Machine), a version of EVM that uses ZK proofs for validating transactions.

Challenges in Creating Crypto Tokens

Creating crypto tokens incurs considerable time and effort when conducted by in-house developers, as hiring qualified professionals is tough, and training newbies is tougher.

Building a crypto token project also requires a lot of money, as many initial expenses exist even before reaching prospective investors.

Launching a crypto token requires a wealth of knowledge in blockchain technology, marketing, business development, and the digital economy. Without sufficient exposure, working on the project might become troublesome.

Legislative processes also pose a challenge to crypto token businesses, as regulations are changing fast, as many countries are changing their stance on cryptocurrencies.

How Can We Overcome Such Challenges?

Thankfully, overcoming challenges in launching your crypto token project has become easier due to the presence of experienced companies. These firms have the necessary resources and knowledge on all points related to developing crypto tokens. Be it business planning, crypto token creation, marketing, and post-launch assistance – you have got everything under control with such a company.

It is also necessary for you to get educated about the intricacies of creating crypto tokens to understand how your project is heading toward the desired outcome. Let us see how our team at Blockchain App Factory can assist you at this juncture in a later section.

Commonly Misunderstood Points about Crypto Tokens

“Crypto Tokens are 100% Secure”:While crypto tokens are secured by immutable blockchains, there is no guarantee they are fully safe due to numerous factors. Some include human error, smart contract deficiencies, and hacking attempts.

“Crypto Transactions are Anonymous”: Although your personal information will not be explicitly visible on the blockchain, your transactions can be easily tracked by tracing your wallet’s public address.

“Cryptos Don’t Incur Fees”: All cryptocurrency transactions incur a fee that will be paid to people validating these transactions. Most times, they are minimal, although popular blockchains tend to have unbelievably higher fees during times of congestion.

“Crypto Transactions are Lightning Fast”:This point holds true for some blockchains, while not in others, such as Ethereum. Even those networks offering faster transactions might be subject to lower throughput during unprecedented congestion.

The Cost of Mint Crypto Tokens on a Blockchain

If you think of the cost to mint crypto tokens on a blockchain, it involves several hidden costs in case you are approaching it as a business option. Processes like framing the token’s legal frameworks, business fronts, token creation, and exchange listing incur significant costs.

Promotional efforts also cause notable expenses depending on your business’s specific goals and competition in the target market. The complete process can cost anywhere between hundreds of thousands to millions of dollars, depending on the elements we have considered above. Talk with our experts to know the estimated cost for creating custom crypto tokens.

How Can Blockchain App Factory Assist in Creating Your Crypto Tokens?

As a versatile crypto token development company, Blockchain App Factory assists you in launching tokens catering to your novel business thoughts. We got you covered irrespective of your focus industry, technological requirements, and business plans, as we have the best personnel in every process involved.

You can hire the best developer team from our company to mint tokens, while our business developers and marketers can come in handy to establish your venture for the long term. With us, you can find the ideal partner to work with as a crypto token business due to our support post-launch in terms of technological and promotional expertise.

Conclusion

Henceforth, we have seen how to launch a token on any blockchain, with everything you need to know about the process as a business owner. We saw both spectrums involved in minting crypto tokens and how to make your efforts worth the investment. If you are curious about launching a crypto token for business, you can opt for our development services, which can help you from end to end. Fill out the form below to initiate a conversation with one of our professionals!