Understanding how tokens are created, where they are launched, and what red flags to watch for is increasingly important for anyone following the crypto sector.
Most crypto tokens are not built from scratch in the same way as Bitcoin.
Instead, they are created using smart contracts on existing blockchains that already provide security, infrastructure, and developer tools.
A project team typically begins by defining the token’s purpose, supply, distribution model, and use cases within an ecosystem.
Developers then write a smart contract that governs how the token is minted, transferred, and, in some cases, burned or staked.
Once the contract is deployed to a blockchain, the token technically exists and can be transferred between wallets.
The next step is usually distribution.
Tokens may be allocated through private sales, public sales, airdrops, liquidity pool launches, or community rewards.
In recent years, fair launches, where tokens are made available to the public without private investor advantages, have grown in popularity.
After launch, teams often seek to list the token on decentralised exchanges first, followed later by centralised exchanges if adoption grows.
