While the demand for ICO (Initial Coin Offerings) are sky-rocketing now due to its cost-effective method of fundraising, its value rises when it is created on a well-defined Ethereum blockchain platform.
A solid business idea needs a valuable coin as its unique selling point. Hence the Ethereum smart contract that handles all the operations must be embedded with strong codes. It must be updated frequently to retain the trust of the community. Similarly, ERC-20 is a widely used standard for the open-source blockchain-based computing platform of Ethereum.
The parameters to finalize while launching an ICO on Ethereum
- Fix the start date and the end date.
- Decide the minimum and maximum caps on issuance for fundraising.
- Currency in which the tokens would be expressed.
- Creation of a construction parameter that will adjust how fast a block would be mined.
- Take a call on the total number of tokens to be created (supply).
- Decide how the collected funds would be utilized in the future.
- Mention the product specifications and the benefits offered to the investors in the Whitepaper.
- Create the token and mention a name and design a symbol.
- A robust marketing plan to implement your campaign.
- An interactive website that keeps updating your investors regularly about Ethereum ICO development.
- Around-the-clock customer support team for addressing the issues faced by your investors.
Some specific terms and conditions to impose in an ICO
- Access to tokens is permitted for the investors only after the ICO officially ends.
- A closed private presale can precede the launch of the ICO for invited people.
- Early buyers purchasing tokens can benefit from a bonus scheme offered by the ICO.
- In case the fundraising goals have not been met, the exchange oughts to return the funds to investors.
- A certain amount of tokens can be reserved for the team members and founders.
- The funds raised can be released during vesting periods or any other specific circumstances.
- Funds can either be stored in the established contract or transferred to multi-signature wallets.
Basic tools required to build your ICO on Ethereum
- Most developers use Solidity as the programming language and OpenZeppelin Solidity Contracts as the base of the smart contract.
- Similarly, a suitable testing tool will have to be utilized to test and deploy the contract on the Ethereum blockchain.
- A registered address on Ethereum (Ropsten Network).
- A well-recognized framework as the testing and building tool.
- A text editor (Sublime or Atom)
Manual smart contract testing
The smart contract is like the glue that holds all the operations together. While unit tests can determine the strength of the code, it also has to be used against a working blockchain network. It will help in deciding the bugs and making appropriate changes before going live.
What to do when there is a need for a change in the contract?
While deploying the package in the operations, the smart contract’s code is final and cannot be changed. However, the token offered to the investors can be updated even after going live. However, investors must be informed accordingly about it. It involves updating the code, undergoing the unit tests, and testing the contract once again. Then, data migration should be conducted from the previous contract to the new contract.
Since the old contract would be frozen, the fundraising process should be halted, token transfers should be paused, and there should not be any change in the existing token balances of users. Update the smart contract on all the pages of your website to conclude the process.
Another way is by organizing all the existing contracts in an object-oriented structure. The main contract with a public address would function as a Proxy. But this can reduce the trustworthiness of the contract. Hence make sure that your system suits the owner’s interests and balances the trustlessness inherent in the blockchain system.
While developing contracts require a lot of effort, updating them is not too easy. The community should be informed about the change taking place, data migration should be executed, and other modifications should be planned upfront.
Ahead of the official launch of the ICO, make sure that all the codes are extensively tested. A professional team should do a review of codes. Before committing to the repository, each line of the written code must be checked by its peer. This would help in discovering any incorrect implementation and inconsistent behavior in the smart contract.
While ICO’s have transformed the cryptocurrency business due to the absence of the intervention of regulatory bodies, access to a complete portfolio of investors, and a global reach for tapping investments, it works seamlessly with blockchain technology.
When an enterprise figures out how to start an Ethereum ICO, they must disclose their business requirements to a competent blockchain development company that possesses immense experience in the development and launch of ICOs. This will ensure a profitable way of launching your ICO on Ethereum.