Why People Create Ethereum Token for Fundraising

  • Currently, ETH is a top 3 cryptocurrency used for payments and exchange.
  • ERC20 tokens are simple and hassle-free for deployment.
  • Another method of fundraising is the Initial exchange offering.

What is Ethereum?

Ethereum is a blockchain-based platform. Ethereum was founded in the year 2015. Ether is a digital currency and derived from the ethereum platform. Ether is a peer to peer software platform used in the ethereum platform. We can avoid the fraud, control, and interference of third parties by using these smart contracts and decentralized applications.

Ether is shortened as ETH in the crypto market. The value of 1 ethereum equals to $132 in the coin market. Many traders started to trade the ethereum in the trading market and gained their profits. Bitcoin is the first cryptocurrency launched across the globe. The real fact is Ethereum derived from the bitcoin. But bitcoin has a lower supply and has more liquidity.

Currently, ETH is a top 3 cryptocurrency used for payments and exchange. So in the future, it may become the first position in transacting and trading in the crypto industry.

By using ethereum you can raise the funds. In this blog, I have clearly explained how the ethereum token is used for fundraising.

What is Ethereum token(ERC20)?

Ethereum token is a kind of digital asset acquired from the ethereum blockchain. Ethereum token used for buying, selling and trading. You can buy the ethereum token by any cryptocurrency in the exchange platform. These tokens are derived from the existing ethereum blockchain. So there is no need for developing the new blockchain.

The prominent ethereum token in the ethereum blockchain is ERC20.  For now, the ethereum smart contract is ERC20. For developing an ERC20 token there is a set of rules for developers. Only after satisfying the rules the developers can create your own ethereum token ERC20.

Why people create Ethereum token(ERC20) for Fundraising?

ERC20 is the most popular token which is derived from the ethereum blockchain. These tokens are widely used all over the globe. Each ethereum token is unique but the value is the same. Its a secured and useful token for a startup and entrepreneur. So people around the world have an interest in buying the ethereum token for their fundraising.

Ethereum tokens are the specific type of smart contract that lives in the ethereum blockchain. ERC20 tokens are simple and hassle-free for deployment. There are some strategies for fundraising using the ERC20 tokens they are Initial CoIn offering(ICO), Initial Exchange Offering(IEO) and Security Token Offering(STO).

There are some strategies for fundraising using the ERC20 tokens they are Initial CoIn offering(ICO), Initial Exchange Offering(IEO) and Security Token Offering(STO).

ICO is the website where token sales will take place. For participating in ICO, people should buy an ethereum token or they should create their own token.  After creating or buying a token you should send the token to the investor’s wallet address. So for transferring the tokens, you should have a crypto wallet.

You should have white paper for your project which should be unique and innovative. So that investors can provide you funds. After these processes are done, your token sales will begin on the ICO website. You can set your price for your token and buyers will start to buy your token.

Here the investors will not market your ICO website and you should take care of marketing your tokens. If the marketing and token sales go well then it gives you a huge amount of profits and also for the investors. So by using ethereum token, you can raise your funds.

Another method of fundraising is the Initial exchange offering. It is a feature-packed module integrated into the cryptocurrency exchange platform. Many people said IEO is the evolution of ICO. it is a crowdfunding process. So when you use the ethereum token in the IEO module. You can raise your funds hassle-free.

How to Launch an Ethereum(ERC20) token:

For creating a single ethereum token, there is a set of rules to follow. So that they can be traded, exchanged, sold and transferred to other’s wallet addresses.  Only the ethereum token development service provider can create an ERC20 token. It contains six mandatory rules and three optional rules.

Mandatory rules to launch an ERC20 token:

  • Total supply
  • Balance of Transfer
  • Transfer from
  • Approve
  • Allowance

Optional rules are:

  • Symbol
  • Token name
  • Decimal (up to 18)

In every ethereum token development service, There are some steps to launch an Ethereum token they are

1. Decide how the token should be

The first step is to decide how your ethereum token should be. Also, know how this ethereum based token is helpful for your project. List the features and make a plan.

2. Write a smart contract with ERC20 standard:

Writing a smart contract  is an essential part of the blockchain technology, there are some functions in ERC20 standard they are

  • Total supply
  • Contract owner
  • Approve
  • Transfer
  • Allowance
  • Add holder
  • Remove holder

3. Test contract code:

After writing the smart contract code, run and check the functionalities of code whether it works and completely okay.

4. Validate the tokens:

After checking the functionalities of code, start to validate the tokens. By transferring the tokens to other address you can validate the ERC20 tokens. Check the performance of the token. If there is any problem with these validations, then make the corrections.

Then finally deploy these steps in the ethereum blockchain. So that you can launch an ethereum token.

Ethereum is an open source, public, blockchain-based distributed computing platform and operating system featuring smart contract (scripting) functionality. It supports a modified version of Nakamoto consensus via transaction-based state transitions.

Types of Ethereum tokens:

There some types of ethereum tokens and each token differs from other tokens:

  • ERC721
  • ERC998
  • ERC223
  • ERC777
  • ERC 621
  • ERC 827
  • ERC 1155

These ethereum tokens said to be ethereum standard and used in blockchain technology.

Some of the tokens which work with ERC20 standard they are:

  • Tron
  • Qtum
  • EOS
  • Binance coin
  • Omise go

Some of the wallets which supports ERC20 tokens, they are:

  • Coinbase
  • Exodus
  • My ether wallet

Benefits of using the Ethereum (ERC20) token:

  • You can trade the cryptocurrencies or digital assets quickly in the ethereum platform.
  • ERC tokens can handle the incoming token transactions in the smart contract.
  • These tokens accepted in cryptocurrency exchange platforms all over the world. So its hassle-free for users to perform transaction or trade using this erc20 tokens.
  • Hassle-free from the risk and vulnerabilities.
  • ERC20 tokens have higher liquidity compared to other ethereum tokens. So the users or traders can buy and sell instantly in the cryptocurrency exchange platform.
  • There is a proper regulation for the ERC20 tokens. So there is no need for developing an ethereum token from scratch.
  • Uniform and speed transaction
  • Functionalities implemented in ERC20 will help the client to interact with tokens and blockchain technology.


In the crypto industry, there are many other ethereum tokens are available in the market. Even though ERC20 token has some issues or bugs it will be overcome in upcoming days. Till now many big projects use ERC20 tokens for their best outcomes. so choose the top-grade ethereum token development service provider for the best outcomes in your business.

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Ronon Margo

Hi, I'm Ronon Margo, Crypto Writer at Icoclone. I love to share my ideas & thoughts on Blockchain & Cryptocurrency in a simple & readable manner. You can find me doing nothing when I'm not involved in writing.

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