Launch an ICO on Stellar Blockchain
As we were working on a couple of ICOs being launched on the Stellar network, we noticed that everyone’s talking about Stellar. And not without much reason to be honest. Afterall, one doesn’t get to see an organization truly disrupting ecosystems as big as the financial world. Based on our experience with helping teams launch ICOs, Our team compiled an in-depth guide on how to launch a successful ICO a couple of months back. As much as I would’ve loved to just update it addressing the awesome functionalities that the Stellar blockchain offers, it just wouldn’t be enough to make you understand it completely. So here we are, with just the step-by-step guide on how to launch an ICO on Stellar Blockchain with custom tokens that everyone’s looking for. This is totally based on what we learned and understood with different ICOs being launched on the stellar network.
Let’s launch an ICO!
I’ll save some really precious time of yours by not giving the same ol’ talk about how many millions have been raised in the last one year, or how ICOs can be a great option for crowdfunding and raising funds in general.
What I will talk about though, is how a vast majority of these ICOs have been launched until now. Well, it was with the Ethereum Blockchain. The ICO Tokens are issued in the form of ERC20 Tokens which are pretty good because of the smart contracting language that comes with the Ethereum blockchain. However, the longer processing times for the ethereum network during the ICOs along with insane gas prices more often than ever has made the developers and entities looking to raise fund look outside the plane. And what do they see?
It’s the Stellar Blockchain.
Despite the fact that Ethereum has a great Turing complete smart contract programming language and whatnot, Stellar is increasingly becoming the first choice for people eager for launching an ICO. The reason is simple – the Turing complete smart contract programming language proves out to be more counterproductive than useful for a number of ICOs, especially the ones that don’t need a turing complete smart contract language in the first place.
On the other hand, Stellar blockchain offers to launch an ICO that’s tailor-made for every company’s or organization’s requirements. They do this by providing base abstractions in form of accounts, tokens, payments, offers or even atomic transactions. These little yet significant abstractions when put together, allows you to issue even dividends, bonds, escrows and even things like collateralized debt and inflation, which were more or less unheard of so far.
Another thing that must be integrated when you launch an ICO on stellar blockchain with custom tokens is the frontend panel for users as well as the company/organization launching the ICO.
This dedicated panel for users can be used for getting real-time updates about the ICO and the assets. This frontend panel will also be used for buying custom assets with XLMs or even exchange it for other assets on the stellar network. This is as easy being done as said because of the customizable and comprehensive contract writing procedures in the stellar ecosystem.
Reasons to launch an ICO on stellar network with custom tokens.
Faster, Better and Cheaper (IT MATTERS!)
With the valuations of Ether skyrocketing out of the blue more often than ever, the gas prices computational transactions on the Ethereum blockchain have become increasingly expensive.
However, having no such provisions of “gas” with the stellar network has its own benefits for the people choosing to launch an ICO on Stellar Blockchain with custom tokens. Not to mention the quick median transaction time on Stellar blockchain which happens to be 5 seconds, which is far quicker than the 3.5 minutes for Ethereum blockchain.
Built-in Decentralized exchange.
This is perhaps the biggest advantage to create an ICO on stellar network. With so many tokens springing up on a daily basis, the competition for being listed on the exchanges has become more cut-throat than ever. And to be realistic, even if these exchanges tried to list every token issued ever, it’s just not possible. But the stellar network and their built-in Stellar distributed exchange have sort of the USP that solves this problem. This network was designed with the sole purpose of making trading efficient and worthwhile. Any token created on the Stellar network immediately qualifies for being traded at the decentralized exchanges. That is the reason why most of the companies looking to raise funding through ICOs are trying to launch their ICO with Stellar.
So if you decide to launch an ICO on Stellar blockchain with custom tokens, you won’t have to be on the mercy of exchanges like Poloniex, Bittrex or any of the Cryptocurrency exchanges. You can contact us freely to discuss how the Stellar distributed exchange can be even more useful to you.
The simplicity of the transaction model on Stellar blockchain and the significantly smaller core codebase makes sure that there aren’t many pitfalls here and there when you launch/create an ICO on Stellar Blockchain with custom tokens. This is because of the fact that these transactions which do not need the full generality of Turing-Complete smart contracts have their security improved in a more significant way than one would imagine. Also, quite a few other security advantages are attached with the built-in Stellar distributed exchange.
The ability to trigger atomic multi-operation transaction leads to a much more auditable code while limiting uncertainty and risk of harm from bad actors who try to exploit program vulnerabilities.
Now, we’ve discussed more than enough about why it is a good idea to launch an ICO on stellar blockchain with custom tokens. Let’s get into how to launch it!
The first step, obviously, is to create an ICO token on the stellar network and then some other small steps which are important to the final execution of your ICO. So, let’s issue the tokens first:
Step.1 – Create an issuing account
The stellar network’s laboratory can be used to generate the desired key pair. Following this, Lumens are sent to this public key for creating the account inside the network. Now, a set number of lumens are required to be sent to the new public key that you just created. This is called, “funding the test account”
This is the very first step in launching an ICO on stellar blockchain with custom tokens.
Step. 2 – A distribution account is created.
The same method as of step 1 is followed here for creating the distribution account when you set out to issue the tokens to launch an ICO on stellar blockchain with custom tokens.
But this time, the account needs to be funded with a larger number of Lumens as compared to the last one.
This distribution account is crucial for your ICO on the stellar network since this is what you’ll use for selling the tokens, the very point of launching an ICO. Once you are done with this step in the process to create an ICO token on the stellar network.
Step.3 – Trusting the issuing account.
The parameters to which the accounts work are tweaked a little, and hence the trust operation is changed.
This is something that’s called adding the trustline. Since we know that our aim is to send tokens from issuing account to the distributing account, the latter will need to trust the former and the asset that they are about to receive. Adding the trustline is done to ensure just that.
Step. 4 – Token creation.
We’re halfway through now, the issuing and distribution accounts have been created. The trustline has been added successfully.
The tokens are generated by simply sending assets from the issuing account to the distribution account. There’s a tool named transaction builder which lets you build a new Stellar transaction. In that transaction builder used to launch ICO on the stellar network, you will need to input values like Source Account, Transaction sequence number, Base Fee(Amount in Stroops) along with memo. Following this, the issuer needs to select the operation type, and then choose the destination along with the kind of asset they want to move. The amount is then deducted from the issuing account. A lot of care needs to be taken in this step to create an ICO token on the stellar network.
The next thing that needs to be done is publishing the information about your token, which you plan to offer as you launch an ICO on Stellar blockchain with custom tokens.
Step. 5 – Limiting the Supply.
Now that you’re done with issuing the token, and have told everyone out there about it, it is very important to limit the supply as you outta prove the investors and token buyers that you’re not just going to flood the market with your tokens.
Locking the issuing account which we created in the first step would be of prime importance here. Again, you’ll have to go to the Transaction builder tool. Basically, freezing the account is somewhat similar to that of making a transaction itself.
Step. 6 – Distributing the tokens
After having limited the supply, the next step is to distribute the tokens. And tell you what, this is where you benefit the most from deciding to launch an ICO on stellar blockchain with custom tokens. Partly because of the built-in decentralized exchange that we talked about in the beginning of this blog.
All you have to do now is, put out a sell order with the desired prices and then anyone interested will be able to buy them. While this is so slick for the tokens created over the stellar network, even the other tokens don’t really face many difficulties since Stellar allows the entities to accept BTC/ETH for the ICO. This was all you needed to now on how to create an ICO on stellar network.
Get in touch with our Stellar Experts.
If you are looking to launch an ICO on Stellar Blockchain with custom tokens and need consultation or advise regarding it, feel free to get in touch with us. Our capabilities with the Stellar blockchain has been built over a year of research and experimentation with a number of dApps and exchanges.
Feel free to get in touch with us for any consultation regarding your ICO.