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How To Create Your Own Cryptocurrency
mspohr writes "Since the code for Bitcoin is open source, we have seen the creation of various Bitcoin clones and enhancements (Litecoin, Dogecoin or Coinye West, anyone?... There are about 70 listed on this site.) This article explains the process of making your own. Thanks to Matt Corallo, a veteran Bitcoin developer, you can easily create your own at coingen.io. He has automated the process of modifying the source code to create custom currencies. Just enter in the name for your new currency, a logo image and set a few parameters (or accept the defaults), and you can have your own cryptocurrency. Source code and some customizations cost a bit extra. Once you have your own 'coin,' you just need to convince people that it is worth something."
As I noted on Bitcontalk to someone who bought Bitcoins for over $1000 each, "Great! We need suckers like you to keep this thing going!".
At least that's more visually appealing than the goddamn Slashdot beta site.
I'm in the process of making a coin! I named it HLC or HighlanderCoin, it's halves every 500000 and has an initial block value of 0.000001 HLC. Best part is, there can be only 1!
What happens when Bitcoin goes over $2000? Or what happens when it goes over $50,000? Or what happens when it goes over $200,000? [...] Only time will tell, my friend. Only time will tell.
Good luck with that.
Flame away, but I think the whole trend of digital currencies is stupid. It basically comes down to people tasked their computers with solving math problems. Okay, big deal. Whoopie for those people. Their math problems are not worth anything. The inverse of the old saying, "Nothing of value was lost." fits here. Nothing of value was created.
People want to trade one fiat currency, for another? Okay. What's the point?
Our economic challenge is one of resource scarcity. Coming up with schemes to trade compute time for fiat paper is not doing anyone any good.... With the exception of those few who are fortunate enough to convince some suckers to trade their paper for solutions to complex math problems.
I found mutiple errors in the first paragraph of the paper. That does not engender trust in the quality of the authors work. The first paragraph of the paper states:
> Every four years the number of bitcoins created is scheduled to be cut in half until 2040
The correct date is approximately 2140 AD. The reward per block started at 50 BTC and is cut in half every 210,000 blocks, which nominally takes about 4 years. After ~130 years you have done 33 halvings, so the reward is 50 / (2^33) = 0.58 Satoshi, where 100 million Satoshi = 1 bitcoin. Since the smallest unit in the bitcoin transaction system is 1 Satoshi, the reward becomes too small to measure, and thus mining for new coins stops.
> Mining is done by volunteers who operate servers running bitcoin software.
Three errors in one sentence. Most miners do it for income, not volunteering. They earn a share of the block reward by participating in mining pools. They don't use servers, they used to use graphics cards until that became too difficult, and now mostly use custom hardware (ASICs). Neither are servers in the client-server sense, they are nodes in a peer-to-peer network, because they have to receive new transactions and send completed blocks to the other nodes. Miners generally don't run "bitcoind", the default client, or other wallet software. They run custom mining software for the kind of mining hardware they use.
Might I recommend this one instead: http://www.devtome.com/doku.php?id=scrypt_altcoin_cloning_guide Written by yours truly back in May. Source is no longer on line for the examples (foocoin) but there's so many clones out there, one can use any of them.
I know what you're thinking. Did I forward 65,535 packets or 65,536 packets?
> Mining seems to just waste energy,
No, mining is "proof-of-work" to enable reaching consensus on the order of transactions. This is necessary to prevent spending a balance multiple times. Only the first spending event counts. It is done by searching for hard to find hashes for a block of transactions + the hash of the previous block + a random number you insert until you meet the hard-to-meet condition (a low hash value). Using the hash of the previous block as part of the data for the current block puts the blocks in sequence, so you can know the order of transaction events. Attempting to change any block contents, such as altering transaction values or adding another transaction will change the hash, so it no longer matches the value stored in the next block. If you attempt to find a matching hash for your altered block, now the second block will no longer match the value in the third block. You end up having to find hashes for every block after the altered one up to the last one.
By making finding hashes so hard that the entire mining network can only succeed every ten minutes, you force everyone to collaborate on the search, leaving no computing power to generate an alternate history of transactions. The longest chain of blocks had the most work put into it, and thus represents the consensus of events.
If you can figure out another way to ensure digital transaction data isn't altered, great, you can become famous. Nakamoto's big invention is chaining hashes + requiring work to find the hashes, so that altering the data would require even more work. As long as a majority of the network is honest, a hacker can never catch up.
When Bitcoin goes over $2000 yes, you'll be able to buy any tulip bulb you want.
That is very true. A wise speculator can make money on any asset, as long as the asset's price is moving. It was tulip bulbs, and it was shares, and it was metals, and it was houses... and now it is just long numbers.
It's just important to note that being money and being an object of speculation are two goals that are diametrically opposite. So far BTC is an excellent object of speculation - and the better it becomes at that, the less attractive it becomes as money. The BTC picked the speculation route, and as result it is now a bubble. "Buy now, the prices are guaranteed to grow into millions per coin, the prococol is designed for that!"