Did you know, there are different forms of money? Not just real and counterfeit. These categories were relevant in the 20th century. Now we have cash, digital money or money that can be accessed via online media and plastic money that refers to credit cards and debit cards.
But in the last decade, the whole world has seen the emergence of a new form of money. It is certainly the cryptocurrency. Cryptocurrencies or virtual currencies are digital assets that can be used as a medium of exchange. Some examples worthy of cryptocurrency are Bitcoin, Dogecoin and Dentacoin. There are many other such cryptocurrencies available online.
It is important to keep in mind that cryptocurrency operates in the digital domain. It is not part of the daily economy. Digital currencies can not be used in place of normal money. Another way to see it is that the digital currency space is not regulated by the government.
The digital currency is "extracted" by users. The total value of the currency depends on the involvement of the user and can not be monitored or managed by the federal government. This is what makes cryptocurrencies volatile and risky.
The Tech Behind Cryptocurrency
The hype surrounding Bitcoin is the main reason for a surge in demand for digital currencies. However, cryptocurrencies are the result of the technology called "Blockchain". Blockchain is a revolutionary technology that has emerged since 2007. Blockchain development technology is a network-based system that records data and stores it in the form of blocks on the network. Each block has information on different aspects such as
- User details – personal information of users entering the transaction. This includes name, username, IP address, personal address etc.
- Transaction details – product record transaction object, transaction value, quantity and tariff
- Date / Time – The date / time records the date and time when the block is created or used.
This information is contained in each block. Each block is accessible from anywhere on the network. Since the information is decentralized and transparent, the Blockchain development technology is also called "Distributed pubic ledger".
Creating Your Own Virtual Currency
Because it is not regulated by the government, you can create a cryptographic currency of yours without the need for government permits or permits. Some basic knowledge in coding and programming is sure to help, but you can still create a virtual currency without this knowledge.
So how do you create a virtual currency in your name?
Step 1: Defining the source code
A source code is also referred to as an intelligent contract. An intelligent contract contains all the information on the virtual currency. The source code is similar to the prospectus of a company. The nature of the currency or the purpose behind the issuance of this currency is contained in the source code. If the purpose behind the creation of the crypto-currency is well defined, then it becomes easier to raise money with the initial offer of coins. For example, there is a cryptographic currency called Dentacoin which was issued in support of dental care. Users can pay for their dentists (who accept Dentacoin) for their services or as a premium payment for future services. This way, users will not have to spend real money on their treatments.
Some coding substrates will be needed to create source codes. Satoshi Nakamoto was the man behind the creation of cryptographic money. He had published his original white papers after launching Bitcoin. Going through the original white paper of Satoshi can also be very useful for making smart contracts
Step 2: Define your currency
Do you want your cryptocurrency to be like Bitcoin? Or do you want it to be better?
If you want to replicate a very popular and widespread currency, it is a good idea to make some changes to the tokens. Any deficiencies in the original currency can be replaced by adding new features in the smart contract. To make this exercise fruitful, it is best to study Bitcoin all the way. The Bitcoin source code is publicly available and can be downloaded from different websites. You can create a new coin in your name and keep updating it with new improvements. This is the passage that differentiates your currency from other virtual currencies out there.
Step 3: Initial coin offer
The first step helps to build architecture for virtual currency. The second defines the currency. These two steps are the most technical parts of creating your own virtual currency. The third step is to raise funds through the initial offer of coins or ICOs. This step concerns the marketing of your coins. The ICO process is totally dependent on creating trust with users. No one will finance your currency if the purpose behind the question of money is not clear.
There are many coins that have not raised funds. They were certainly built on a good system, but the coin definitions were not attractive to investors. Investors should never have the impression that promoters are raising funds for their personal interests. Investors should be offered a currency that meets their personal interest. One of the cryptographic coins called Mastercoin was created by linking the initial corpus to the properties of the existing bitcoins. However, this approach was not successful because it seemed that Mastercoin was trying to replace bitcoins. Thus, a bad definition may be the reason for the failure of a cryptocurrency.
Step 4: Promote your currency
Buy your currency in a way that attracts a broader investor base. Satoshi was able to bring Bitcoin to such lengths primarily with a well-planned and well-executed marketing strategy. The only way your coin will be successful is only if you are able to find a convincing step. The currency must be indicative of a low-risk investment that offers a high value. Many critics in the virtual community are aware of viral adoption by new coin issuers. Your currency should represent a source that creates value for investors. Because your currency is better than others it should seem obvious to the skeptics. Offering value is the only way to successfully promote a token in the virtual currency space.
We hope this guide will help you. Follow these steps strictly, but try to deepen the meaning of the words and the process in general.