You have a custom created ERC20 or BEP20 token. Now the task is to increase the market cap of your token. In this article, lets look at the various ways in which you can increase the market cap of your custom token. Also lets look at some ethical practices when done can significantly increase the market cap of your ERC20 or BEP20 token. Before diving deep into the activities to be done, lets first get a clear understanding of certain things. Note: Through out this article we will be using the words ERC20 & BEP20 alternatively. As it would take un-wanted space to use them both together.
What is market cap anyways in the world of cryptocurrency?
In simple words, market capitalization of a token is the current price of a token multiplied by the total circulating supply ie. Market Cap = Your token’s current price * Total Circulating supply. The words to take note here are “Current price” & “Circulating Supply”. As you might already know the current price of a token is the price in which the token was last successfully traded ie. bought or sold( most probably in an exchange and the transaction should be recorded on the chain ). The circulating supply of a BEP20 token is the approximate number of tokens that are actively circulating in the market ie. actively being traded or transacted. It is different from “Total Supply”. As significant amount of Bep20 tokens can be easily locked up/ staked etc. and not in action. The total supply of an BEP20 or ERC20 token is the sum of circulating supply + reserved(staked, idle) minus the tokens that have been burnt.
The market cap data of tokens that show up on BSC Scan and EtherScan is pulled in real-time from other services like CoinMarketCap, CoinGekho, CryptoCompare etc. These market capitalization sites get their data as a weighted average of the transactions happening on various cryptocurrency exchanges and from the respective blockchains.
What type of Market Cap is suitable for your ERC20 and BEP20 token?
While working on improving the market capitalization of your custom token, you need to first decide what sort of a market cap do you want to show for your token. You need to choose between Large-cap, Mid-Cap or Small-cap. As each types has its own set of fans and investors. While large cap tokens are considered safe, many investors avoid it. As it is very less volatile. Mid Cap ERC20 tokens are safe enough and also provides good volatility for investors to trade. Low Cap Bep20 tokens are considered very high risk and provides high returns due to the tremendous volatility it brings.
How to increase the market cap of your BEP20 and ERC20 Token?
Its a open secret that market capitalization platforms like Coinmarketcap only picks up transactions from markets that charge a fee for each transaction. This is done to reduce fake volumes by trading tokens up and down by the promoters themselves. For this very reason, the first step towards creating a authentic market cap for your tokens is to get them listed in an Crypto Exchange. You can choose to list it in a centralized or a famous decentralized exchange as well ex: Uniswap, Pancakeswap etc. Once your BEP20 token is publicly listed on an exchange, it also gets showcased to the millions of users using the exchange. So, getting listed is anyways a WIN for you.
Update: If you need help getting your token listed on an exchange, you can contact these experts.
Apart from getting your ERC20 token listed in an exchange, also have all other basic pre-requesties in place. Like Whitepaper, Website, Tokenomics etc. ready for your BEP20 token.
– Mint-Burn Tokens:
Your BEP20 tokens getting minted & burned is a healthy sign. Even if not for the market cap, this activity denotes that your tokens have a business model behind it. Usually the minting & burning of tokens indicates that this process happens for a Bep20 token based on the results and milestones the project achieves. In MakerDao for example minting of new DAI tokens happen when DeFi loans are given and burn happens when loans are re-payed. Similarly if you have an automated or manual process for mint-burn, the price of your tokens too will be more volatile thus attracting more users. When you mint more tokens, liquidity and circulation of your tokens increase. When you burn your tokens, circulation decreases thus increasing the price of your tokens. These actions also get recorded on the blockchain and show as transactions for your token over time. You can easily enable the MINT-BURN functions in your BEP20 tokens smart contract. And can also automate it based on your business model.
– Add Liquidity on DEX
Even if you have your token listed on a good centralized exchange, make it a point to list it on a good Decentralized exchange as well. Create liquidity pools for your token with top 3 cryptocurrency in the exchange. To match the price of your token in the CEX, execute trades on the DEX regularly ie. for every trade that happens in the CEX, do a trade in the DEX exchange.
– Do private sales with real-time exchange behind the scenes:
The first step anyone would take after creating a cryptocurrency is to run a private sales. To facilitate this sales, we would setup an ICO Dashboard -or- token dashboard and integrate the custom cryptocurrency token inside. Once the dashboard is setup, we start marketing the ICO dashboard to potential investors to come and buy the tokens directly. Instead of directly sending out the tokens to the buyer, integrate a module to your dashboard so your users can directly get your token from a live exchange. If done like this, every sale would show up on the public blockchain thus increasing the market cap of your token. This can be achieved in 2 ways:
(1) Parallel Buy-Sell on exchange: Setup a master wallet behind the scenes in your ICO Dashboard. Whenever a user buys your token > execute a buy using a DEX API, so equal amount of tokens are bought using your master wallet and it gets topped up. The advantage here is that there will be equal number of token buy orders executed in the DEX showing up on the blockchain.
(2) Real-time Buy-Sell on exchange: The most recommend way is to allow the Buy-Sell to be directly executed on the participating DEX using the address of the user. Either you can use the exchanges API or just re-direct the user to the token listing contract page on the exchange. In this way the transactions will look all the more impressive.
If you need help in any of the above work, you can contact the experts HERE.