Getting into crypto for the sole purpose of converting it back into fiat currency may be limiting your financial options. The success of Bitcoin, Ether and other altcoins points to a much deeper truth about the world we live in and how we express value in our lives.
You could get Bitcoin and convert it into a bunch of Subway sandwiches as well. That’s also not the value I’m talking about.
The true value of cryptocurrency is the path it opens for savvy individuals to create their own store of value and present it to the world as useful. Using tools in reach of the average person, you can create your own cryptocurrency, and with it, your own financial system and philosophy of value.
Creating a Simple Cryptocurrency
Creating a cryptocurrency to compete with Bitcoin or Ether would require a substantial amount of financial resources and manpower and is beyond the scope of any single text. You can get started, however, with these steps.
- Define your objective. The reason your money exists is known as your “use case” and will define many things about your cryptocurrency. The way you verify transactions, the way people earn your coin and the way you market your coin all depends on your use case.
- Agree on a consensus protocol. To function properly, your coin will need a blockchain. Blockchains rely on a consensus protocol or an agreement between users on how coins are mined and transactions verified.
- Choose a blockchain. Save yourself the work of creating a blockchain from scratch — there are plenty of reputable platforms to choose from. Here is a list of the most popular blockchain platforms, each with their own specialty.
- Decide on a node design. Your nodes are the online devices that will connect and support your cryptocurrency. You will need to decide if your nodes will be private or public, hosted on-site or in the cloud, how powerful they must be and the base OS they will run on.
- Create your blockchain architecture. Your architecture includes defining permissions and block signatures, addressing address and key formats, establishing the rules for issuing assets, developing key management security, connecting your nodes, enabling atomic swaps and estimating parameters for transactions.
- Choose an API provider. Your chosen blockchain application programming interface (API) will connect your blockchain nodes with exchanges. Different APIs have different advantages, so choose your API provider based on your original objective.
- Design a user interface. The interface you design is your first impression to the world. You will decide on mail and web services, external databases and the front-end programming language.
Marketing Your Currency
Most crypto traders have a few coins in a portfolio that have no real use or value — they just kind of sit there. These coins may be the product of a stagnant idea, or they may be the victim of an unfortunate marketing campaign. No matter how well-formed your network and how progressive your idea, it means nothing if you can’t get other people excited about it.
There are no hard-and-fast rules about how to market crypto. You will find some ideas used over and over again, which seems to imply they are at least somewhat effective. We’ll list those strategies here.
- White papers and roadmaps: Successful cryptocurrencies all start with a use case. Developers use the whitepaper to discuss the philosophy behind the money to a nontechnical audience. The roadmap is the plan for the more technically involved.
- Product-market fit: Your use case must address a market need. You will find it difficult to market a cryptocurrency that does not actually fix something, or worse, tries to copy a more established coin with fewer resources.
- Building a community: Crypto may be esoteric to the majority of the population, but the people who will form your core audience are technically and financially savvy. You will need to build a community around authenticity and knowledge of the space. Telegram and Discord seem to be the platforms of choice for crypto communities.
- Reaching out to influencers: You can put positive attention on your coin through good reviews and podcast performances.
- User-generated content: Ideally, your crypto is a source of inspiration for others to build from. This is especially important if you don’t have a huge marketing budget to work with.
Crypto is just as much about the people you serve as the coin you produce.
More Money, More Problems
We have enough information from the history of established cryptocurrencies to predict some of the problems that new crypto will have.
- Regulation: Governments around the world are doing their best to catch up with crypto. The U.S. has grudgingly taken an attitude of adoption, but its major financial organizations — the Securities and Exchange Commission (SEC), the Federal Trade Commission (FTC), IRS, FinCEN and Treasury Department — have yet to agree on the definition of cryptocurrency, much less decide how to regulate it. That hasn’t stopped them from trying. Regulation will undoubtedly increase over time, making the development and expansion of new currencies more difficult.
- Malicious actors: Crooks follow the money. Both individual amateurs and professional trading platforms have experienced the issues that come with inadequate security and structural weakness. Billions of dollars worth of crypto have been stolen from unsuspecting (and suspecting) victims. As your crypto grows, it pays to invest in updated security to protect yourself and your investors.
- Technical disagreements: Be ready to accept criticism and disagreement from within. The nature of cryptocurrency is consensus. As your currency grows, some of the people who run your nodes may disagree with you on how to continue to move forward. When this happens, coins may experience a fork — a software update — but it can also represent a difference of opinion in how a network should be run. Litecoin, Bitcoin Gold and Bitcoin Cash are examples of successful forks.
The True Value of Cryptocurrency
The first widely used cryptocurrency, Bitcoin, became popular as a rebellion against the flaws of central banking during the 2008 banking crisis. The most popular blockchain and currency today, Ethereum, is rising because of its trustless system of smart contracts. Yes, you can buy trinkets with Bitcoin and Ether. The true value in these coins, however, lies in the conviction underlying them.
If you take the time to create your own crypto, make sure you are doing it for the right reasons. Should you become successful, you will likely run into regulators, hackers and competitors looking to take value from you. You will need the courage of convictions far deeper than money to take on the world. If you realize this deeper truth, as they say, the money will come.
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
- Active traders
- Intermediate traders
- No charges to open and maintain an account
- No account maintenance fees or software platform fees
- Intuitive trading platform with technical and fundamental analysis tools
- Only offers 14 coins
Founded in 2015, Exodus is a multiasset software wallet that removes the geek requirement and keeps design a priority to make cryptocurrency and digital assets easy for everyone. Available for desktop and mobile, Exodus allows users to secure, manage and exchange cryptocurrencies like Bitcoin (BTC), Ethereum (ETH) and more across an industry-leading 10,000-plus asset pairs from a beautiful, easy-to-use wallet. The noncustodial functionality is encrypted locally on users’ own devices, ensuring privacy, security and complete control over their wealth. Exodus is on a mission to empower half the world to exit the traditional finance system by 2030.
- Newcomers to the cryptocurrency world
- Ease of use
- Trezor integration
- Huge selection of cryptocurrencies
- Excellent 24/7 customer support
- No personal info needed
- FTX app not available on the mobile app
SoFi takes a modern approach to personal finance. It recently created buzz with the release of SoFi Crypto, a way to trade cryptocurrency on the app. The platform allows investors to familiarize themselves with crypto. It offers a high level of security, great customer support and an intuitive interface. However, it does have shortcomings with the number of cryptos offered and geographic restrictions.
- Centralization of your money
- Charges low or no fees for some functions within the interface.
- Relies on Coinbase, a very secure platform, to process transactions.
- Presents a low barrier of entry — you only need $10 to start trading.
- Currently only offers 28 coins.
eToro is headquartered in Cyprus, England and Israel. A major eToro plus is its social trading operations, which allows new clients to copy trade the platform’s best performers. Its social trading features are top notch, but eToro loses points for its underwhelming research and customer service features.
- Investors looking to CopyTrade other traders
- Simple user interface
- Several major cryptocurrencies and altcoins
- Expansive network of social trading features
- Large client base for new traders to imitate
- Only 29 coins available
Gemini is a cryptocurrency exchange and custodian that offers investors access to over 100 coins and tokens. Founded in the US, Gemini is expanding globally, in particular into Europe and Asia. Offerings include both major cryptocurrency projects like Bitcoin and Ethereum, and smaller altcoins like Orchid and 0x.
Gemini is 1 of the only brokers with multiple platform options based on skill level. New investors will love the streamlined interface of Gemini’s mobile and web apps, while advanced investors might appreciate all the tools that come with ActiveTrader.
In addition to a host of platform choices, Gemini users also have access to insured hot wallets to store tokens without worrying about digital asset theft. Learn more about what Gemini can do for you in our review.
- New investors looking for a simple mobile and web app
- Day traders looking to use technical analysis tools
- Users looking for a 1-stop-shop to buy, sell and store all of their cryptos
- Easy and quick signups — can get started in as little as a 5 minutes
- Multitude of platforms to accommodate traders of all skill levels
- Hot wallets include insurance to protect your from theft and hacking attempts
- Charges both a commission and a convenience fee for users buying and selling through the desktop or mobile app
Coinbase is one of the Internet’s largest cryptocurrency trading platforms. From Bitcoin to Litecoin or Basic Attention Token to Chainlink, Coinbase makes it exceptionally simple to buy and sell major cryptocurrency pairs.
You can even earn cryptocurrency rewards through Coinbase’s unique Coinbase Earn feature. More advanced traders will love the Coinbase Pro platform, which offers more order types and enhanced functionality.
Though Coinbase doesn’t offer the most affordable pricing or the lowest fees, its simple platform is easy enough for complete beginners to master in as little as a single trade.
- New cryptocurrency traders
- Cryptocurrency traders interested in major pairs
- Cryptocurrency traders interested in a simple platform
- Simple platform is easy to operate
- Comprehensive mobile app mirrors desktop functionality
- Coinbase Earn feature rewards you with crypto for learning about available coins
- Higher fees than competitors