I had a great idea for one type of coin/toke, but I was wondering how easy or expensive is to execute. I have seen post on this, but all of them scratche the surface.
Thanks.
Its quite expensive and time consuming..
First one need the following
- white paper
I’ve seen many White Papers that exist for the wrong reason. Many White Papers are in fact marketing papers. This is the first smell of a scam. A White Paper should describe a problem thoroughly and dedicate a large part of the paper to providing a possible workable solution. Always backup your claim why your solution would work.
- the purpose for your token
Decide on how you want to incentivize your contributors with the tokens issued to them. Do your maths and research into the soft and hard token cap number and their implications. Becareful of running uncapped ICOs as people are becoming more weary of it. Choose an easy-to-remember token symbol.
- Terms and condition
You want to do you legal background research early. Decide on your ICO terms and conditions. Decide on who can and cannot contribute. Ideally, you want a legal advisor in your team. Is the nature of your business even legal in your country? How do you intend to spend the funds raised? How is the token distributed? Does the core team intend to keep some tokens by themselves? Always keep abreast of ICO legalities in different countries.
- Build a great Team
To me, this is the hardest part. How do you get people to believe in your idea — Not just normal people, but people with credibility willing to stake their reputation with your idea. These people must have verifiable linkedin accounts. Many ICOs started off by being overly top heavy, example you have the CEO, CFO, CSO, CTO, blue chip advisors…etc but no engineers! This gives people the impression that you have no ability to execute your idea. If your idea is blockchain related, you need to get blockchain experts in your team. People who know blockchain are hard to come by. Make sure you do enough networking to know the right people.
- Decide on what token technology to use
With all the ground work laid out, its time to chose the blockchain technology powering your token. At the time of writing, Ethereum is by far the most popular and matured platform for launching ICOs. Creating Ethereum ERC-20 Tokens is easy but implementing custom crowd sale logic around the token can take a bit of thinking. For example, you might have discount structure based on the contribution date. You have to also consider refunding contributors if the ICO fails to reach its soft cap…etc. Its worth noting there are also quick token solutions such as WAVES and NXT but they are not all-in-one crowd sale solution.
- Execution plan
Decide on how how many rounds of token sale you want. For example, a private sale, presale, ICO and a general sale for each stage having different discount structure. There had been many criticism on many ICOs in the past. In general, you want to be fair and not allow a few to buy out all the tokens. So you might want to verifying the user’s identity before allowing them to participate. One easy way to do that is to create a whitelist (eg Enigma ICO whitelist). At the time of writing, the SEC(U.S. Securities and Exchange Commission) is prosecuting Token Sales without KYC procedures (Eg ICON KYC) and some cryptocurrency exchanges are beginning to exclude cryptocurrencies that did not implement KYC. KYC is tricky and troublesome but is legally required for some countries.
- Token and crowdsale smart contract
When writing the actual smart contract and again in the context of Ethereum, Open Zeppelin libraries are helpful when writing secure Crowd Sale and Token Smart Contracts. Be weary of overusing it though as the contract could become bloated and users have to pay high gas fees when making contribution. Always do lots of testing and auditing as you are dealing with people’s money.
- Hardware setup
There are quite a few setups to do. First of all, you will need a wallet to store the the funds collected during the ICO. A multi-sig hardware wallet is a good option. You will also need contingency plan in place if your wallet ever gets compromised. Assuming you are using Ethereum, you also need to setup an Ethereum node fully synced with the test and main net to launch and test your smart contracts. There might be trial and error during this process for example you might be switching between geth and parity clients…etc. If you are hosting your website, you will also need to setup the hosting environment. In other words, you want to setup the hardware for your ICO early.
- website
You will need to have a responsive campaign frontend connected to a running node so as to track the progress of the sale. Your website should be usable and idiot proof with very clear instructions on how to contribute. Many professional ICO also has a login system for users to manage their account and upload or download any documents if required. Having a dedicated portal also improves your brand but require more work to set it up.
- market early and Market right
In addition to creating brand awareness and running standard marketing campaigns using bitcointalk forums, linkedin, facebook, twitter, slack, bounties, campaigns, ico listing websites, subscription list…etc, research into the minds of crypto traders and enthusiasts. People who invest in ICOs are people who are into crytocurrencies. Advertise in places where they visit, know who they are following in youtube and do video interviews. Video is still the best conversion platform. Go to meetups and meet people in real to gain trust. Its very hard to get Mr and Mrs smith to invest if they have trouble understanding what bitcoin is.
FINALLY
Learn from successful ICOs on how they did it. Google knows who they are.
Proof read all your documents over and over again.
Don’t underestimate the amount of legal investigation, time and preparation work required to launch an ICO.
A Smart Contract is never completed. Keep testing, auditing and refining.
Engagement and good customer service equates to sales.
Allow enough time to create the market hype before the actual ICO starts.
If you are finding it all too hard, there are companies dedicated to launching ICOs. Google knows them. The only trick is you need to to have a trusted technical person to work with them to make sure everything is on track and done correctly. Be prepared to pay premium for companies for good track record. Good luck on creating your coin/token
- Bernah Pah.
