Altcoins are any cryptocurrency other than Bitcoin. If you want to create your own altcoin, first you should know what is Altcoin. It is simply an alternative coin to Bitcoin which is abbreviated as Altcoin. They are cryptocurrencies that use a technology called blockchain to enable secure peer-to-peer trading.
How do Altcoins work?
In general, altcoins are very similar to the original Bitcoin. With a private key, you can transfer payments from your digital wallet to another digital wallet. In cryptocurrencies such as these, there is a Blockchain or ledger where transactions are permanently and publicly recorded so that transactions cannot be changed or denied after they are done. Blockchain is verified by mathematical algorithms in blocks.
Altcoin vs. Bitcoin
Altcoins do not follow all bitcoin rules. For example, while Bitcoin only mines or produces every 10 minutes, an altcoin called Litecoin produces coins every 2.5 minutes. This allows Litecoin to process payments faster. Litecoin will also generate 84 million coins, while Bitcoin will produce only 21 million coins
There are thousands of altcoins in the market. Some are known as popular bitcoin forks, although their market cap is much smaller than Bitcoin. Some examples of Altcoins are:
Altcoin vs. Bitcoin
Create your own altcoin: Types of Altcoins
Altcoins are sometimes projects by enthusiasts, and sometimes the basis for new tasks. They can even be more than coins and develop in the form of new frameworks for everything from messaging applications to online markets. altcoin often changes the bitcoin rules long enough to produce a unique work and may have a specific application.
For instance, we have stablecoins in the market. Stablecoins are altcoins designed to counter cryptocurrency fluctuations by tying their value to a key index, commodity, or security. Tether is the most popular stable coin which is tied to well-known fiat values such as USD, EUR, etc. So, the USDT is the digital version of USD in the crypto world
Rather than coins, some assets are known as tokens. Tokens are developed on other blockchain networks such as Ethereum. Tether, for example, could also be a digital token because it was built upon Ethereum and Tron.
Some investors are looking to make money by trading them, but it is a risky investment. cryptocurrencies are traded in unauthorized exchanges, exposing you to price manipulation, fraud, and other problems.
Create your own altcoin: What are the pros and cons of Altcoins in the crypto market
- Improve the Bitcoin flaw
- Provide competition
- Low transaction costs
- The value is very volatile
- High potential for scams
The number of altcoins listed in cryptocurrency markets has multiplied rapidly over the past decade, attracting large numbers of retail investors and betting on their price movements to generate short-term profits. But such investors do not have the capital to generate sufficient liquidity in the market.
Niche markets and lack of regulation cause freshwater fluctuations in altcoin valuation. Consider Ethereum, which peaked at $ 1299.95 on January 12, 2018. Less than a month later, it fell to $ 597.36 and at the end of the year, the price of ether fell to $ 89.52. It reached a record high of $ 2,000 two years later. So, trading in bigger time-frames can be very rewarding for traders.
But there is a problem. Cryptocurrency markets are not yet mature. Despite several attempts, there are no specific investment criteria for evaluating cryptocurrencies, except their whitepaper revealing the purpose, technology, and the team behind the particular crypto. In most cases, however, the altcoin market is driven by speculation. There are many cases of dead cryptocurrencies, cases that could not be sufficiently accepted by investors or simply disappeared after investors raised money.
Thus, the altcoin market is for investors who want to take the very risk of operating in an emerging and volatile market that is prone to volatility. They must also be able to withstand the pressures of sharp price fluctuations. For such investors, cryptocurrency markets offer great profits.
Types of Altcoin
If we want to compare the altcoin market with bitcoin we can find better versions of BTC technology. Even for the payment purposes, many of the altcoins perform better than Bitcoin. Some altcoins, such as Ethereum and Ripple XRP, are already considered by major institutions, leading to high ratings.
Investors can choose from a wide range of digital assets that perform a variety of functions in the cryptocurrency economy. Altcoins have a smaller investment market than Bitcoin. As of April 2021, Bitcoin controls 60% of the total cryptocurrency market.
The lack of defined rules and criteria for investing means that the altcoin market characterized by fewer investors and thinner liquidity. As a result, their prices fluctuate more than bitcoins.
It is not always possible to distinguish between different altcoins and their uses, making investment decisions more difficult and confusing. Several “dead” altcoins lead to the sinking of the investors’ capital.
Why do so many people still doubt that cryptocurrencies are alive?
Over the past few years, cryptocurrencies and everything related to them have become a global topic of discussion. Since the term is associated with the concept of decentralization, it is obvious why new digital money launching projects are rapidly creating excitement on the Internet and attracting investors.
We all know that the most popular cryptocurrency today is Bitcoin. The characteristic of this digital coin is the lack of complete control of government officials and the lack of economic dependence on any traditional bank. This is exactly the fundamental difference between government-controlled cryptocurrencies and fiat currencies. In turn, the absence of intermediaries involved in financial transactions resulting from decentralization is a determining factor in the future outlook of these currencies.
We should note that the vast majority of existing cryptocurrencies have a high limit on the total supply. This means that as demand increases, so does their value in foreign markets.
If this concept of currency is so promising, why are so many leaders still skeptical? In fact, the reasons are quite simple. People are often skeptical of innovations. For the general public, bitcoin (not to mention other less popular coins) became popular quite recently, and the whole idea of blockchain-based money was so radical that it took at least a few years to surprise and confuse the average person.
On the other hand, the sharp fall in the value of the most popular cryptocurrencies in foreign markets at the beginning of 2018 caused a lot of dissatisfied surprises of conservative investors: “I told you: it was all a bubble!” Yes, those who started investing in cryptocurrencies did not realize all the potential dangers, they are obviously disappointed with this trend.
In fact, the reasons for the fall are not so terrible and do not undermine the viability of the cryptocurrency. They can summarize in three factors. Over-selling over-buying (as the dollar began to grow, investors began to sell their savings widely).
Strengthening government control over cryptocurrency transactions in some countries (here we need to thank the governments of China, India, Russia, Egypt, and Saudi Arabia). Bulk futures (many large exchange traders deliberately devalue the currency to create the most favorable conditions for future purchases).
So, with the right knowledge, time, and budget, you can start building an altcoin with complete confidence. Some training will follow below.
Guide for creating your own altcoin: Basics
For a complete answer to Q: “How you can create your own altcoin?”, We offer you advice from our experience.
Decide on your future currency building approach
In fact, there are several ways to start building an altcoin.
There is also another option – you can create your own altcoin with the help of a special operating system. This is a great method for people who already have an idea of how blockchain works, but are not very familiar with the nuances of its technical implementation.
In this way, the technical support of your chosen platform will be responsible for all aspects of coin production for your customers. These services are provided by WalletBuilders and CryptoLife.
To get started with these providers, you need to set key parameters for future cryptocurrencies (maximum amount, exclusive symbol, trading commission, etc.). You can use ready-made and configured templates and make almost no settings yourself (except creating your own currency symbol and name). These patterns start at 0.01 BTC (you can find a trial version in WalletBuilders) and can set up in a few days after purchase and configuration.
- Use the available Blockchain
If you are a relatively experienced developer and developed blockchain-based solutions over and over again, the fastest way to create a new cryptocurrency is to convert the codebase of one of the publicly available coins. Such code usually releases by developers on Github (as in the case of Bitcoin). Another brilliant example is Litecoin. Charles Lee came up with the code, which prepares by Satoshi Nakamoto’s team, modified it a lot, and made the results public.
On the other hand, before creating your own altcoin you can write your code from scratch, without resorting to ready-made solutions. In this case, it is best to leave the process to an experienced development team, as a programmer, even an experienced pioneer, will have difficulty working accurately on all aspects of the modern alternative cryptocurrency platform.
2.Create a Token
As a cheap and low-cost solution, you can create a Token. While a coin has its own blockchain, a token works on top of an existing blockchain like Ethereum.
Therefore, all translations rely on selective network technology. Tokens can show everything from concert tickets to loyalty program points, while coins carry wealth.
A public ICO often organizes to provide a Token to the audience. As a base for a token, any material or intellectual asset will do. The main thing here is for blockchain involves in some way in the token operation. Otherwise, an ICO would be useless.
3.Choose a standard to execute the smart contract
Traditionally, most cryptocurrencies are based on the ERC-20 standard (which represents the Ethereum platform). You can use services like MetaMask to correspond with the service. This is a special Chrome plugin that connects the newly created blockchain platform to Metamask RPC servers.
As a result, the operating system owner has full access to the Ethereum feature. CoinLaunch is a service that can help you connect to Metamask. Their price depends on the amount collected during the ICO. They usually charge around 5-10% of the amount collected during the ICO.
4.Create an MVP
Create your own altcoin platform is a kind of start-up that does not have complete functioning, we suggest building an MVP. In fact, MVP is a useful solution that shows the main function of the product and allows the user to collect feedback. Therefore, you can test your product on your target audience and understand the possibility of further development.
5.Look for investors
Launching cryptocurrencies is an expensive event. In addition, if you decide to create your own altcoin and set up a full-fledged ICO, it is unlikely to cost less than $ 150-200 thousand. To many of us, such a budget seems cosmic, so looking for investors would be the best solution. To find more people willing to invest in developing your business idea, you need to hire experts to build and maintain a smart and informative website for you.
Have you ever wondered, “How do you create your own altcoin?” We hope this article answers your question. As you can see from our altcoin creation guide, setting up your own cryptocurrency have a very complicated process and requires deep technical skills from the makers.