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How Are ICO Tokens Made?

ico tokens

It’s important to think about your ICO token. There is a good reason why an ICO stands for Initial Coin Offering – it involves coins. Ethereum and Stellar are two great examples of platforms that allows you to utilize the native tokens. You can likewise develop your blockchain and use that to generate a symbol. There are a few things you should think about regardless of which technique you choose to take.

Questions to ask yourself

Here are some concerns to ask yourself before setting out to develop your ICO token:

  1. What is the overall objective of your service?
  2. How will it take advantage of blockchain technology?
  3. Why do you need a token system?
  4. What worth does it give users?
  5. Is it lawfully certified?
  6. Can you list the token on a crypto exchange?
  7. Who is your competition?
  8. Why does your platform need an ICO token?

Your ICO token should be closely related to the product and services you’re providing. There are three primary kinds of ICO tokens.

ico tokens

1. Security tokens

‘Security’ is a comprehensive term that covers any possession that can be traded. This kind of token can represent tangible items like gold and residential or commercial property in the context of your ICO. Ensure to check out security guidelines if you will be providing these tokens

2. Utility tokens.

The Howey test needs tokens to satisfy three requirements to qualify as securities. Tokens that do not fulfill these criteria are generally called ‘utility tokens.’ This kind of token tends to be an integral part of a blockchain platform or application that enables users to use it or benefit from premium features.

3. Equity tokens.

Equity tokens are the most recent in ICO tokens and work mainly like shares in an IPO. Investors will get tokens that permit them to vote on decisions taken by the company running the ICO. Regulations for equity tokens are still uncertain.

ico tokens

Initial Supply of Tokens – how many should you make?

You will require to decide the number of tokens there will be, and how they need to be distributed. Keep in mind that you have several alternatives:

  • Private sale
  • Pre-ICO sale
  • ICO sale
  • Post-ICO sale

You also desire to assign some tokens to your team and board of advisers, in addition to for overhead and reserves. How many funds you intend to raise will also help determine the Initial Supply of Tokens. A lot of ICOs have both a soft cap and a hard cap on how much they wish to raise.

How to create your ICO token

The vast bulk of ICOs uses Ethereum (ETH) as their platform to generate tokens. As a result of the Ethereum platform’s popularity, you can find a lot of guides focusing on that process. It doesn’t need to be time-consuming either! You can make an ERC-20 token in just 20 minutes. There are a few constraints on the Ethereum platform, however. Some alternatives have been created to make up for this issue.  Among those alternatives is Stellar Lumens (XLM), and there’s also guides on how to create a token on their system.

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