Medium.com create your own ethereum token

If so, you should set aside about 70 minutes. Moreover, in addition to our instructions and screenshots, utilize the video at the bottom of this article. This is also where our timestamps throughout this article point to. After all, this is the path you should take if you want to get the most out of this example project. Set Up Hardhat Note: If you are used to working with Remix , you can take that route instead of deploying your smart contract with Hardhat.

Then, use the terminal and select the obvious options to complete the Hardhat setup. At this point, you know that our Web3 Medium clone needs to be able to take the metadata and convert it into NFTs. You will use this file to compile and verify your smart contract. For detailed guidance on finding these values, use the video below, starting at Once your smart contract is live, you can start interacting with it using PolygonScan However, our goal is to create a neat UI for that purpose.

When you focus on using React, you start by initializing a React project However, to ensure that your dapp runs as presented in the demo above, you need to implement the appropriate code. As such, make sure to use the video tutorial below to automate the uploading of metadata to IPFS Moreover, with the metadata in place, you can use your smart contract to mint web Medium posts as NFTs As such, you can follow his lead and switch to the old UI: However, below are also the instructions to help you navigate the updated UI: Log in to your Moralis admin area.

You also learned how to create, compile, deploy, and verify an ERC smart contract. Does the total supply number matter? Not really. What matters is the total supply compared to the price per one token — the market cap. For example, you can rarely see the tokens with less than , or more than 1,,,,, 1 quadrillion in supply.

Unconventional numbers can push investors away. Bitcoin BTC , for example, has a max supply of 20 million, while Ethereum has a current supply of more than million. Number of Decimals The number of decimals is how many digits your token has in the fraction part. For example, if your total supply is 10 million tokens, on the network your supply with 18 decimals looks like the following: 10,, Why 18?

There is a fundamental difference between minting and mining tokens related to the type of protocol used in the network. You just want to know that the mining technology is getting outdated, and all the tokens in the Layer 2 protocols are minted. That means your tokens will be minted, too. Token minting is simply a process of creating new tokens. Transaction Fees Token Tax The question of transaction fees deserves a special mention as this topic is not widely covered in any existing sources.

Transaction fee also commonly known as Token Tax is a fee taken by the network from each transaction. What happens with the remaining one token is determined by the token creators and the token smart contract. Adding liquidity — tokens go to one of the liquidity pools to provide higher market liquidity. Burn — tokens are simply getting burned.

Profit-sharing — tokens are distributed between the existing token holders proportionally to their stake. So, what transaction fee should I implement in my token economics model? It highly depends on other incentives your model offers to the users. Often projects set up high transaction fees to prevent token holders from actively selling received tokens. However, you should be careful with implementing high token fees as it can create the opposite effect and send a negative signal to an investor.

Thus, they may not see enough value in your project and would rather not invest in your token. Generally, transaction fees of 0. In the OB Trader project , we implemented a 0. It is worth noting that the fees can be made adjustable even after the token is launched.

When creating a smart contract, developers can make it so you can modify transaction fees and how they are distributed in the network later on. Inflationary There are two types of economic models you can select for your token: Deflationary and Inflationary. In the deflationary model, token supply only decreases over time.

Deflationary models are made possible with the token burn mechanism. Token burning is the process of a token being permanently removed from the system. Burn on transaction — automatic mechanism defined in the token smart contract that burns a certain amount of token from each transaction. Not to mention that users occasionally lose or forget their private keys to wallets, making the tokens unrecoverable. So pretty much any token model with limited supply becomes deflationary.

Deflationary token models are generally simpler to design; therefore, many new projects choose them for their tokenomics. A deflationary model makes it easier to increase token value over time since the supply only becomes lower. There are different examples of the inflationary model: some release tokens on the fixed schedule, some use non-linear functions, and others simply mint tokens on-demand.

It is generally not a great idea to let someone e. If the public looks at the contract code and sees that you can mint an unlimited number of tokens at any given moment, investors will run away from your project like from a fire. Staking is the process of token holders validating transactions and maintaining the security of a network.

As a result, validators receive token rewards for supporting the network. Token rewards minted for network validators in the block creation process are what causes market inflation. Mixed Models Many projects successfully use a combination of deflationary and inflationary models.

More precisely, they use a primary inflationary model with some deflationary mechanisms token burns. With enough transactions per second, the burn rate can reach 1. Step 4: Polish and Add More Incentives As a final step, analyze everything you defined so far, examine potential flaws in your model, and think about extra ways your model can add value to the investors.

Consider not only the use-case of your token from a business or technical perspective but also the perspective of your future investors. How can your token metrics increase the value proposition for them? Incentive Mechanisms There are several incentive techniques available in the arsenal you can introduce in your token economy system: Profit-sharing Allow token holders to benefit from holding their tokens by distributing rewards.

These can be airdrops, fee reflections, or other discretional token distribution events. Burning Burn some of the token supply to decrease the number of tokens in circulation and raise scarcity. The more tokens you burn, the more valuable the single one becomes. Staking Allow token holders to stake their tokens and earn rewards by being validators in the network.

This way, you enforce the holding of tokens. You can see the extended list of various tokenomics techniques and examples here. Worth the read for inspiration. Key Properties Of Successful Tokenomics Model To summarize, a great token economics model has to satisfy a set of different rules, and most importantly, provide value to the token holders.

As a result, a well-designed token has the following properties : Has usefulness in the ecosystem and without it the ecosystem will function less efficiently or will not function in principle; It has inflationary resistance, so the issue of tokens is thought out in the system; Scalable: tokens can be sent between people quickly and in large volumes; Replaceable, unless it is a unique token non-fungible tokens ; Accepted by many people, services, artificial systems; It has liquidity: tokens are traded on exchanges and p2p sites; It has motivational features for use, which are divided into economic incentives the token holder earns more or saves with it or managerial incentives the token holder has the right to vote and is able to influence the ecosystem.

Examples Examples of projects with well-designed tokenomics 1. Polkadot offers two primary features: Parachains — Polkadot offers a framework with comprehensive tooling for blockchain developers to implement their own blockchain projects. Slot Auctions. To participate in Parachain, developers have to submit their project proposals and bid on the auction to get their Parachain slot. Because the places are limited, the highest bidder wins the slot.

This auction mechanism helps maintain a high bar of quality for all the projects on the Polkadot network. Within the Polkadot ecosystem, DOT holders can do the following with their tokens: Participate in the governance of the Polkadot network. DOT token holders have certain voting entitlements within the governance framework of the platform, similar to how shareholders can vote on matters regarding a listed company.

Participate in staking either to become a validator or to nominate validators. Bond tokens to connect a chain to the Polkadot Relay chain as a parachain. Parachain slot winners only lease their slots for a fixed period; they will have to rebid at the time of renewal. The value of the successful bid in DOT is bonded for the duration of the lease. Participate in Crowdloans. Crowdloans are a new feature offering an interesting proposition for token investors, as they create a competitive environment in which projects have to offer incentives for participation.

What makes the Polkadot tokenomics model stand out? The whole Polkadot system is designed to incentivize two primary roles: users and developers. After the Crowdloan is fulfilled, the DOTs are locked in the contract until the team completes the project again, clever freeze mechanic. The use of the two above mechanisms creates buying pressure for DOT.

This, in turn, attracts more investors and other developers. In the Polkadot model, there is a clear correlation between ecosystem growth and token price growth — the more developers and users there are on Polkadot, the higher the token price, which is evident from the DOT chart below. The Helium Token is designed to serve the needs of the two primary parties in the Helium blockchain ecosystem: Hotspot Hosts and Network Operators.

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