Accel Wiki

Ease of Token Creation

Tens of thousands of ERC-20 standard cryptocurrencies are generated on the Ethereum blockchain day to day. From 2019 to 2020, the total amount of new tokens created increased by 75%, jumping from 200,000 to 350,000 (notables include: Bancor, Shiba Inu, and the native Uniswap token). While this certainly correlates with the growing rate of cryptocurrency adoption, other factors also explain this growth. As cryptocurrencies and 'blockchain technology' become more popular, so has the collective end users knowledge base. Further, this has led to new strategies that have made token creation easier for everyone. The inherent flexibility in smart contract creation has led to many brilliant ideas, such as rebase tokens that redistribute tokens based on transactions, deflationary tokens that decrease supply based on trading volume, or dividend reward tokens that reward native token holders in Ethereum based on volume. The world of smart contracts in the Ethereum and EVM compatible space is nothing short of amazing. With some coding knowledge and a little bit of startup capital, anyone is able to put their own ERC-20 token up for trade on a decentralized exchange.
While incredible, the ease of this creation has led to many new problems within the space. Often, startup tokens embark on their journey with lofty ideas, failing to recognize the skills, reach, time, and capital it requires to be successful. Due to low startup capital, many of these tokens use specially coded smart contracts to help generate revenue for the project. Other tokens run purely based on the smart contract to provide benefits to their holders. Consistently we have watched these types of tokens fizzle out due to the following reasons:
Too narrow of a market within crypto - Poor community management Improper planning - Lack of funds for development/marketing - Poor strategy due to lack of knowledge in the space - Lack of understanding about how much work a startup really is - Missing revenue generation strategy