HOW TO CROWDSALE YOUR TOKEN


In our previous article, we created an ERC-20 token and even did as much as testing it on the Sepolia Testnet. This article will exhaustively discuss the steps of successfully selling your ERC-20 token.
If you are reading article and do not have a token yet, check out our article on how to easily create your own ERC-20 token, test it on testnet, connect to Metamask, and prepare for the big sale in simple steps to be discussed below.

What is Crowdsale?

Crowdsale or ICO crowdfunding is an approach used by project developers or founders to raise funds for their cryptocurrency projects by offering project’ tokens to the general public or a list of whitelisted investors. These investors are generally referred to as early adopters or early owners. Hence, they usually purchase the token below the token listing price when listed on exchanges.

While crowdsale is not restricted to only ERC-20 tokens, it is an approach that can used to sell erc-20 tokens to a community of investors, garner the interest of early adopters, and develop an ecosystem for support upon final project launch and token listing.

Benefits of Crowdsale: Why Developers Use Crowdsale?

  • It is an alternative fundraising technique for project developers who cannot secure sufficient funding from Angel Investors or Venture Capital.
  • It provides investors with early access to promising cryptocurrency projects
  • Increase investor profit margin as the token is usually sold at a price that is lower than the listing price.
  • Provide new crypto projects with a vibrant community of users and investors

Step-by-Step Guide on How to Crowdsale your Token

Generating funds for your project through crowdsale is only possible when you have a token to sell to investors. Yet to create your own ERC-20 token? Follow the simple steps in our previous post to create one in minutes.

  • Step 1: Create a crowdsale smart contract: Creating a smart contract allows you to define the features of the token sale. You can decide on features like exchange rate per token, select token pair (ETH or USDT), define the token sale period, include conditions for whitelisting and incorporate refund mechanism where the soft cap (minimum funding goals) is not reached or to prevent exceeding the hard cap (maximum funding goal).
  • Step 2: Test smart contract on a Testnet: Test the smart contract on Sepolia to you detect functionalities errors before finally deploying your token on the mainnet for purchase.
  • Step 3: Deploy on Ethereum: In your Metamask wallet, add enough ETH for the gas fee and proceed to deploy the contract on Ethereum once the testing is completed using tools like Hardhat, Remix, or Foundry.
  • Step 4: Set Up a Crowdsale Dashboard: On your project website, create a crowdsale dashboard. If you intend to work with a launchpad like Binance Launchpad, Poolz or Dao Maker, a front-end dashboard is created on any of these platforms for your crowdsale.
    The dashboard is where investors connect their wallets to buy your oken using ETH or a selected stablecoin. On the dashboard you can also check the dashboard to view token sale progress and monitor the distribution.
  • Step 5: Marketing and Community-Building: Now that your crowdsale dashboard is set for token sale and management create consistent PR for engagement. This is where partnering with Launchpads can be very beneficial because tokens are sold directly to whitelisted investors in the Launchpads' ecosystems, reducing the hassle of marketing on developers and founders.
    If you managing the sale directly, employ strategies like social media promotion, get Key Opinion Leaders (KOL) and influencers to support, recommend, and speak about your project, hold Twitter space, and include airdrops and bounties to spread the word.
  • Step 6: Token Distribution & Post-Crowdsale Management: Once the crowdsale ends, distribute tokens to investors using proper allocation and claim mechanisms. Follow this up with providing liquidity on decentralized exchanges like uniswap or sushiswap to enhance token accessibility and easy trading.

Conclusion

Successful crowdsale is not the end of building a sustainable cryptocurrency project. In the real sense, it is the start of everything. After the sale, listing on notable centralized and decentralized exchanges and ICO websites like CoinGecko and CoinMarketCap is a post-token sale hack to boost visibility.
Additionally, investors expect a moderate return on their investment, and achieving this requires consistent development. Sticking to the roadmap, maintaining long-term value, and gradually increasing adoption allow you to create a strong community and maximize the benefits of token sales for your project and investors.