The Ultimate Guide to Creating Your Own Cryptocurrency without Writing a Line of Code

The advancement of the Blockchain technology creates new opportunities for new and existing businesses. One of the first use cases of Blockchain technology was to create a cryptocurrency.

Do you have this great new business idea or getting ready to launch a startup, and you want to embrace the new world and create your own cryptocurrency? Do you have an existing business and want to know how to capitalize on a cryptocurrency without writing a single line of code?

We will guide you along the journey and help you in all aspects of cryptocurrency creation and distribution. You will learn how coins and tokens differ and show you how to easy it is to use our solution to create your own cryptocurrency and determine whether your business needs it.

Let’s dive into everything you need to know to build a successful cryptocurrency.

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What is a Currency?

A currency is a unit of storage and a means of exchange. In simple terms, it is a universally accepted way of buying or selling any goods or services.

Before any paper currency, when the barter system was in place anything from rice and grains to wool and even feathers would be considered a currency. Then came in government and banks to regularize this means of payment and made coins and printed paper banknotes.

Now in the digital time and age, the coins and paper banknotes seem to become outdated. A new form of currency was born - the cryptocurrency.

What is a Cryptocurrency?

Cryptocurrency is a decentralized digital currency that uses encryption techniques to regulate the generation of currency units and to verify the transfer of funds. Anonymity, decentralization, and security are among its main features. A cryptocurrency is not regulated or tracked by any centralized authority, government, or bank.

Cryptocurrency is a new phenomenon in our world and it is used just like a normal currency but in a digital form and exists only in digital world. It can be accepted universally unlike physical currencies that usually are only accepted in a specific country and have to be converted into other currencies. No single centralized platform controls the cryptocurrency and there is no central bank that can print additional units whenever they fell like it. For decentralized cryptocurrencies the amount of “coins” is usually strictly limited. 

Cryptocurrency is based on a technology called Blockchain.

Blockchain is a decentralized peer-to-peer (P2P) network, which is comprised of data blocks that are based on encrypted data that is verified to be correct and agreed upon by all users and that cannot be changed retroactively. These blocks chronologically store information about transactions and adhere to a protocol for inter-node communication and validating new blocks. The data recorded in blocks cannot be altered without the alteration of all subsequent blocks.

Virtual money have been available for a while. Today, more than 2,000+ and growing types of cryptocurrencies, including the most popular ones like Bitcoin exist. Companies small and large has embraced the benefits of the Blockchain and are starting to think about how to embrace those new cryptocurrencies.

Benefits of having your own cryptocurrency

If your business or startup requires its own Blockchain network, you can create your own digital currency to incentivize other business to join your Blockchain network and contribute computing power. A growing list of the markets and industries are being disrupted by new ecosystems formed with the Blockchain technology and running on Omnibasis.

Here are a few reasons why you should create your own cryptocurrency today:

1. Eliminating fraud risks - cryptocurrency is impossible to counterfeit and no party can reverse or change past transactions.
2. Providing transaction anonymity - customers choose what information to share with the other party in the transaction.
3. Cutting down operating costs - cryptocurrency is free from exchange or interest rates, as well as the high transaction charges traditional banks apply.
4. Anytime, anywhere transactions - no holidays, no business hours or geographic location limitations, cryptocurrency transactions are borderless and instant.
5. Providing security for funds – with no central government in charge, cryptocurrency is a decentralized system, where no one can seize or freeze your assets.

Here are some questions to ask to determine if a cryptocurrency is right for your business:

• Is your business a purely online business?
• How do your customers pay? With cash or credit cards?
• Will an online payment option increase your customer base?
• Do you plan to stay in business for more than a couple of years?

If you answer “Yes” to all the questions then your business would be a good fit for a cryptocurrency.

How Does a Cryptocurrency Work?

As mentioned, cryptocurrency is widely accepted use case of the Blockchain technology Distributed ledger technology is built on the consensus algorithms regulating the creation of new blocks. All participants in the P2P network have to accept a block for it to be registered on the Blockchain. There are several types of consensuses with PoW (proof-of-work), PoS (proof-of-stake), DPoS (delegated proof-of-stake), and PoA (proof-of-authority) among the most popular.

With Bitcoin, for example, a small amount of cryptocurrency paid every time a new block is created (consisting of the transfers of crypto currencies between users) and is used as a reward and incentive for Blockchain participants taking part in the consensus mechanism and closing blocks, i.e. allocating their processing power, stakes of coins, and other resources to support the transparency and trust of the Blockchain and to verify new blocks.

Cryptocurrency holders can transfer cryptocurrency assets between wallets (theirs or other users) via the Blockchain addresses, exchange it for fiat money, or participate in cryptocurrency trading. Everyone on the network can view transactions, while the identities of the people behind these public addresses remain anonymous, as they are encrypted by unique keys that connect an individual to an account.

Difference between Token and Coin

Cryptocurrencies can be divided into two large subcategories – coins and tokens. They are both cryptocurrencies, but what is the difference between a coin and a token? It all comes down to these three points:

1. A coin operates on its own Blockchain where all transactions occur while tokens can operate as a “different Type of transaction” on the existing Blockchain protocol. Examples include Bitcoin or Ethereum, all of which operate on a different Blockchain. If you want to create your own coins, you need to first create your own Blockchain. Do not worry, Omnibasis provides Blockchain-as-a-service, where you can launch your own Blockchain network without a need to worry about a physical infrastructure.

2. A token works on top of an existing Blockchain infrastructure that can handle multiple types of tokens, like the Omnibasis platform or Ethereum (which really is a token that runs on its own Blockchain). Tokens are often used as smart contracts, that represent everything from the ownership or characteristics of physical objects to digital agreements about services, or the most common use case on today is to represent a cryptocurrency.

Anyone can use Omnibasis or Ethereum as the underlying technology to create a new token. Today, the primary use for tokens is a security token offering (STO), which helps projects and startups fund operations through a sale of those tokens to their early investors. This is one of the main reasons why companies are starting to consider the question of how to create a cryptocurrency in the first place.

In short: tokens are limited to a specific project, while coins can be used anywhere are considered an accepted store of value.

3. Coins buy tokens but tokens can’t buy coins.

For example, think about tokens as your Frequent Flyer Miles while coins are the actual dollars in your wallet. You can use both to get an airplane ticket, but with the miles, most of the time, your choice will be limited to the airline that issued them, while with the actual dollars you can choose any airline you want.

You can buy frequent flyer miles using coins, but you cannot get real money using frequent flyer miles. So a cryptocurrency coin can be used to buy a business’s token, but you can’t buy a cryptocurrency coin using a token.

Advantages and Disadvantages of Cryptocurrencies

Consider the following pros and cons of cryptocurrencies and why you should use a cryptocurrency in your business operations.

Advantages of cryptocurrencies:

1. Decentralization

Built on the Blockchain, cryptocurrencies are independent from any authority and ensure that no one can dictate the rules for on how those cryptocurrencies are used and transferred by users and owners.

2. Fast and unlimited transactions

A money transaction via banks or credit cards usually take a significant amount of time to be processed and settled. Your business will end up waiting for days to receive money. With cryptocurrencies, you can create an unlimited number of transactions and send it almost instantly to anyone with a crypto wallet, anywhere in the world.

3. Low transaction fees

Banks and other financial institutions charge considerable transaction fees, the larger amount of the transaction, the higher usually the fees. This doesn’t mean that you don’t need to pay a fee for cryptocurrency transactions; however, the amount you need to pay is relatively small. For example, on Omnibasis, the cost of the transaction is as low as $0.001, no matter the amount transferred.

4. Accepted internationally

The sender and the recipient of funds can be in different parts of the world to exchange cryptocurrency and you will not encounter any currency conversion fees that always accompany international transactions during normal transfers.

5. Transparency and anonymity

Thanks to the distributed nature of the Blockchain, every transaction is recorded and the record is immune to changes forever. In addition, if a crypto address is not publicly confirmed, no one will know who made a transaction and who sent or received the cryptocurrency.

The disadvantages of cryptocurrencies:

1. Limited acceptance

Governments and countries are very hesitant about granting any cryptocurrency their support. Just look at the failed efforts of Facebook and their cryptocurrency Libra. If you want to take your cryptocurrency to the mall, there are still very limited possibilities for those who want to accept purchases with cryptocurrency. 

On the other hand, Businesses running on Omnibasis find a great use of cryptocurrency in business to business transactions.

2. High volatility

Most well know cryptocurrencies, like Bitcoin for example, are highly volatile,. It is not a safe place to store value and highly risky to invest in cryptocurrencies, as you never know whether it will be a profitable investment or not. 

On another hand, businesses running on Omnibasis, often peg the value of their cryptocurrency to the some stable index to manage this risk.

3. Transactions are non-reversible

Once you hit save and submit a transaction to the Blockchain, it will take a tiny amount of time to get recorded and once recorded it is not reversible. There is no way to reverse, back out or dispute a transaction. You still can send a request for a refund to your business partner and ask them to send the same amount back, but if it is declined, there is nothing you can do, as the value of the cryptocurrency was transferred to another party. 

On Omnibasis, users have an option to use a paraphrase to secure transactions. It creates an extra security and to verify it is really you before you click submit.

4. Cryptocurrency security

When you store your money in the bank and lose your bank card, the bank will try to verify your identity with a government issued ID and will issue you another bank card. This is not the case with cryptocurrency, if you lose your hard wallet device and forget the paraphrase or private key, you will lose the access to your cryptocurrency wallet forever. If you lose your hard wallet, but still have your paraphrase or secret key, you can reclaim your wallet contents.

On Omnibasis, paraphrase is an option, in addition your private keys are triple encrypted and can be stored off-line. 

Consider the above advantages and drawbacks when you evaluate a cryptocurrency for your business.

How to Create a Cryptocurrency

If you are convinced that owning your cryptocurrency can boost your business, let’s walk through the main steps you need to take to build your own cryptocurrency.

1. Understand your use-case

What is the purpose of the Blockchain for your business? Do you want to execute smart contracts with your suppliers, user authentication and verification, secure user personal data, or use smart asset management? The use cases for the Blockchain are limitless. Define your objectives clear and detailed at the very beginning. Read why businesses large and small are turning to Blockchain technology.

2. Choose a consensus mechanism

Consensus mechanisms are the protocols that consider a particular transaction legitimate and are used to agree on which transactions should be considered legitimate and will added to the block. There are a number of different protocols and your choice will tie you to one or another Blockchain platform. 

A. The proof of work (POW) is a common consensus algorithm used by the most popular cryptocurrency networks like Bitcoin and Litecoin, and requires high energy consumption and longer processing time by computers trying to solve a mathematical puzzle for every single block. 

B. The proof of stake (POS) is another common consensus algorithm that evolved as a low-cost, low-energy consuming alternative to POW algorithm. It involves the allocation of responsibility in determining the next blocks and hence maintaining the public ledger for each participant node in proportion to their stake in the outcome of the result (aka ownership of coins) and is most often implemented via the Byzantine Fault Tolerance mechanism.

3. Pick a Blockchain platform

Your choice of a Blockchain platform will depend on the consensus mechanism you want to use. To give you a better idea of what is out there, here is a list of the most popular Blockchain platforms:

• BigchainDB (supported on Omnibasis)

• Hyperledger Fabric (support soon on Omnibasis)

• Eosio (support soon on Omnibasis)

• Corda (support soon on Omnibasis)

• Neo (support soon on Omnibasis)

• Ethereum – not recommended due to the lack of an enterprise support and use of the proof of work, which is a very slow in committing transactions

4. Design the Blockchain Nodes

A node is an Internet-connected device that supports a Blockchain by storing the data to verify and process transactions. Blockchain depends on the node for efficiency, scalability, building transaction consensus, support, and security. With the proof of stake consensus mechanism, your Blockchain network should have at least four running nodes to reach a quorum (Consensus quota) for each block of transactions.

Here is a list of questions to answer when you are you designing your Blockchain nodes:

a. What permissions and access will a node have to have? Private, public, or hybrid?

b. Where each node will be hosted? On the cloud, on premise or both?

c. What is the size of the node required in terms of hardware details, such as processors, memory, disk size, etc.?

d. What is the nodes base operating system (most common choices would be Ubuntu or Windows)?

5. Establish Blockchain architecture

Like with anything you build, a single family home, a high-rise or your business Blockchain, you need an architecture plan. Some of the questions will be answered by the Blockchain platform of your choice. The Omnibasis platform did a lot of work to answer some of those questions for you and is hiding all that plumbing under the hood with simple step by step configurations. 

Make sure your Blockchain blueprint architecture answers the following topics:

a. Permissions architecture - define how and by whom data can be accessed, how transactions are validated and completed and how new blocks are managed.

b. Address format - what Blockchain address formats will be used and how do you form the address and manage it.

c. Key format - what Blockchain key format will be used and how will you be generating the signatures for the transactions.

d. Asset issuance - what are the rules for creating and listing assets.

e. Asset transfer - what are the rules for asset management and transfers.

f. Key management - what is a good system to store and protect the private keys granting the Blockchain access.

g. Multi-signatures - define the number and level of keys/passwords your Blockchain will require to validate a transaction.

h. Review parameters and estimate the maximum block size, define the rewards if any for block storage and mining and possible transaction limits.

i. Native assets - what are the rules to govern a native currency issued in the Blockchain and how is it used.

j. Block signatures - define how the Blockchain nodes are creating and validating the blocks and what will be required to sign them.

k. Hand-shaking - what are the rules of how the nodes will identify themselves to each other when connecting.

6. Integrated APIs

Make sure to verify that the Blockchain platform of your choice provides pre-built APIs for integration. If it does not, no worries, Omnibasis Blockchain integration provides easy to use user interface screens to manage and build your application on the Blockchain.

7. Design User Interface 

The Communication between your Blockchain and its participants require a well thought user and administrator interface. At Omnibasis, we built a user interface to take you through every steps of the Blockchain design and development without writing a single line of code.

Also consider how your Blockchain will communicate with the web, mail and data storage servers, external databases. What front end and programming languages you will it use (e.g. HTML5, CSS, PHP, C#, Java, Javascript, Python, and Ruby).

Launch your Cryptocurrency on Omnibasis without single line of code

In just a few steps you can build and launch your own Cryptocurrency on Omnibasis. 

1. Pick a great name.

2. Define how the cryptocurrency will be used for your business.

3. Choose your Blockchain platform and configuration.

4. Develop your Blockchain architecture and assets.

5. Develop an intuitive and comprehensive user interface.

6. Explore partnerships to develop a new ecosystem.

7. Make it fun.

Let’s walk through each step one at a time.

1. Pick a great name.

Get people excited about your cryptocurrency with a great name. The name of the cryptocurrency needs to incite curiosity and interest to urge your business network and customers to participate, and it needs to be distinguished from the many other cryptocurrencies they have heard about. 

2. Define how cryptocurrency will be used in your business.

Just like a real currency, you need to offer them something valuable in return to make sure the cryptocurrency matches the effort expended and that those hard earned coins are worth the time and effort. For example, if you're offering cryptocurrency as part of your merchandise return policy, assign a monetary value to your cryptocurrency so customers can visualize what they can buy next time they come back to your business. Omnibasis makes it easy for you and your customer to convert cryptocurrency to any currency of your choice.

3. Choose your Blockchain platform and configuration.

Omnibasis platform is running on the enterprise Blockchain powered by BigchainDB. In addition, Omnibasis supports a variety of Blockchain networks that you can run yourself and just connect to. We also offer “Blockchain-network-as-a-service” – where we will run the Blockchain network for you. Choose your use case: do you want to run your own Blockchain network or put your resources into building your cryptocurrency business and leave the plumbing to the experts.

Regardless of your choice, Omnibasis is here to support your business case with easy to use user interface screens to help you configure and run your Blockchain cryptocurrency. 

4. Develop your Blockchain architecture and assets.

Define your Blockchain architecture. With Omnibasis, it is one simple Settings screen. Choose the level of security, how the assets are encrypted and what is required to create and exchange the assets. With a few clicks your Cryptocurrency will be created. Visit our step-by-step guide to learn how to get started.

5. Develop an intuitive and comprehensive user interface.

We already did all the hard work for you. Do you need a wallet, no worries, done! Do you need an email server integration, done! Do you need your customer or user registration, done! Do you need a cool looking website, done! Do you need SSL, you got one for FREE on us, our compliments to maintain your site security. All you need to do is upload your business logo, and decide on the user workflow through your application.

6. Explore partnerships to develop a new ecosystem.

Now that you have launched your cryptocurrency you can provide more multiple opportunities for your customers and business partners to engage and extend your network. Can you convince your suppliers to take your cryptocurrency as a form of payment? Remind them of the benefits whenever possible, at the contract signing or online order confirmation. For example, If suppliers get paid in your cryptocurrency, the get paid immediately on receipt of good instead of common 30 or 60 days terms.

7. Make it fun.

Turn your cryptocurrency into a fun adventure. Build on the winning spirit of the customer or a supplier who in turn will interact with your brand more. It is called gamification and achieved through the approach that requires participants to attain certain levels of achievement. Omnibasis integrates cryptocurrency with Customer Loyalty Programs. Configure a customer loyalty with cryptocurrency rewards. 

Build your cryptocurrency for free on Omnibasis today!

Measure the Effectiveness of Your Cryptocurrency

Cryptocurrency should grow your business and increase your customer loyalty and retention, and there are no better ways to measure it other than a size of a customer smile.

About Omnibasis

Launch your Cryptocurrency on Omnibasis without single line of code.

Omnibasis is a business management solution to run your sales, marketing, commerce, and operations powered by Blockchain technology. Visit omnibasis.com to meet the operating system for your business.