We spoke with experts to find out why it is very difficult to bring a new cryptocurrency to the market, and making a clone of an existing coin is useless.
At the end of February, according to Google Trends, there was a surge in the interest of Internet users to create their own cryptocurrency. On February 21, the main digital coin reached a historic high of $ 58.3 thousand.After that, the cryptocurrency dropped to a local minimum of $ 43 thousand, but was able to recover and today, on March 7, is trading at $ 50.9 thousand.
Now many organizations offer to develop a turnkey cryptocurrency. Usually, this service includes not only the creation of a full-fledged digital coin, but also full legal support, up to the registration of a legal entity and the creation of a cryptocurrency operator. Also, the developers are integrating the created coin into various exchanges and exchangers, however, the cost of creating a turnkey digital coin amounts to several million dollars. An even larger amount will need to be invested in the promotion of the cryptocurrency.
Simple and inexpensive
If hiring a whole team of programmers, lawyers and marketers is too expensive, then you can resort to an easier way – copy an already prepared coin and create a fork. A fork is a clone of the original digital coin. For example, Litecoin is a fork of Bitcoin, since the source code of the flagship cryptocurrency was taken as a basis. The source code of many digital coins is publicly available on GitHub, but basic knowledge of programming languages is also required to work with it.
Usually, when creating a fork, only basic information is replaced in the source code: the name of the coin, the port setting, the parameters for generating the cryptocurrency, and other aspects. This completes the technical side of the issue and the created digital coin is ready for distribution.
On the verge of failure
Any development with open source code can be very easily copied and modified, but the community will most likely not appreciate the next cryptocurrency “clone”, since it does not carry any value and uniqueness. Grigory Klumov, the founder of the stable cryptocurrency platform STASIS, spoke about this.
“If you copy the code, it will be just a copied product, which has no value for building a new community – there is no motivation to join you,” the expert notes.
Klumov added that today companies create their own improved blockchains, but spend tens of millions of dollars to bring them to market and attract users. He cited Flow, Graph, Near and Avalanche as examples. According to him, now in the world of cryptocurrencies there is the greatest competition in the entire history of its existence, which can be compared with the “dot-com bubble” in 2000.
Is it worth trying
Starting your own project is now much easier than ever, says Vadim Koleoshkin, co-founder of Zerion. According to him, ready-made tools, a user base and the necessary infrastructure are in the public domain. He cited the example of the Polkadot and Cosmos frameworks, which allow you to create your own blockchain without knowledge of cryptography. Koleoshkin notes that in any case, everything will come down to creating your own company and favorable conditions for the growth of the community.
“If someone wants to launch their own token or cryptocurrency, then this should be considered as the launch of a separate company,” he added.
The expert also advised not to enter the market with another fork of an existing digital coin, since such a project does not make sense and is doomed to failure. Koleoshkin advised to analyze the market and give users opportunities that they do not yet have, but really need.
He recommended paying attention to the Uniswap and SushiSwap blockchains. The first team spent years developing the product and selling their idea to the market, and SushiSwap copied the code, saying that they have their own vision for this product and they want to be able to implement it without the participation of the original team. It is noteworthy that the market capitalization of SushiSwap and Uniswap, according to Coingecko, is $ 2 billion and $ 16.44 billion, respectively.