How to Create Your Own Cryptocurrency: An ERC-20 Token Example

Blockchain technology continues to revolutionize industries, with Ethereum leading the charge in decentralized applications (dApps) and token creation. This guide walks you through creating your own ERC-20 token—a foundational skill for blockchain developers and entrepreneurs.

Prerequisites

Before creating your ERC-20 token, ensure you have:

1. A Web3 wallet (e.g., MetaMask, Phantom, or any WalletConnect-compatible wallet).
2. Test ETH (Obtain from Ethereum Sepolia Faucet).
3. A modern browser (Chrome recommended).

👉 Learn how to set up MetaMask

What Is an ERC-20 Token?

ERC-20 is the most widely adopted token standard on Ethereum, defining rules for fungible tokens:

Core Functions (Mandatory)

• totalSupply(): Returns the token’s total supply.
• balanceOf(address): Checks a wallet’s token balance.
• transfer(address, amount): Sends tokens to another address.
• transferFrom(address, address, amount): Allows delegated transfers (e.g., for exchanges).
• approve(address, amount): Authorizes a spender to manage tokens.
• allowance(address, address): Checks approved spending limits.

Optional Functions

• name(): Token name (e.g., "MyNewToken").
• symbol(): Token ticker (e.g., "MNT").
• decimals(): Number of decimal places (typically 18).

ERC-20 tokens rely on smart contracts, enabling seamless integration with wallets, exchanges, and DeFi protocols.

Step-by-Step Guide to Creating Your Token

1. Acquire Test ETH

• Set up MetaMask and switch to the Sepolia testnet.
• Request test ETH from the Sepolia faucet.

2. Write the Smart Contract

We’ll use OpenZeppelin’s ERC-20 library for security and efficiency.

Code Example (MyNewToken.sol):

// SPDX-License-Identifier: MIT
pragma solidity ^0.8.20;

import "@openzeppelin/contracts/token/ERC20/ERC20.sol";

contract MyNewToken is ERC20 {
    constructor() ERC20("MyNewToken", "MNT") {
        _mint(msg.sender, 1000000 * (10 ** uint256(decimals())));
    }
}

Key Customizations:

• Replace "MyNewToken" and "MNT" with your token’s name and symbol.
• Adjust 1000000 to set the initial supply.

3. Deploy the Contract

1. Open Remix IDE (remix.ethereum.org).
2. Compile the contract (Solidity Compiler tab).
3. Deploy via Injected Provider (MetaMask).
4. Confirm the transaction and pay the testnet gas fee.

👉 Explore advanced tokenomics strategies

FAQ

1. Can I deploy an ERC-20 token on Ethereum mainnet?

Yes—replace test ETH with real ETH and switch MetaMask to Ethereum Mainnet.

2. How much does it cost to create an ERC-20 token?

Deployment costs vary (typically $50–$500 in gas fees), depending on network congestion.

3. What’s the difference between ERC-20 and BEP-20?

ERC-20 runs on Ethereum; BEP-20 is Binance Smart Chain’s equivalent (lower fees but less decentralized).

Conclusion

Creating an ERC-20 token is straightforward with OpenZeppelin and Remix. Use this foundation to build utility tokens, governance systems, or DeFi protocols.

Next Steps:

• Add liquidity to decentralized exchanges (DEXs).
• Audit your smart contract for security.

For deeper dives into blockchain development, check out our advanced guides.