What is minting a token?
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 4 min
In short
Minting creates new tokens and increases total supply. Who may do it is set by the contract's permissions. If a mint permission remains with an individual, unlimited issuance later is possible — which makes it one of the more important things to check in a token.
Key points
- Creates new tokens and raises the supply
- Permission to do it is defined in the contract
- If the permission remains, more can be issued later
- Some contracts renounce it to close issuance for good
Definition
Calling a contract's issuance function to increase a target address's balance and the total supply. The conditions and any cap are defined in the contract code.
ERC-20 tokens often include a mint function. Who can call it is restricted — to the owner, to addresses holding a particular role, or to callers meeting a condition coded into the contract. With no restriction at all, anyone could issue without limit.
When new tokens are issued as staking or mining rewards, it happens automatically under protocol rules. Bitcoin's block reward is the clearest case: the amount and timing are fixed in code, with no human decision involved.
Where a specific address retains the permission, later issuance is possible. Some projects renounce the permission once issuance is complete, making further minting impossible at the code level. The current holder of that permission can be read from a block explorer's contract view.
Watch out for
- · Where the mint permission remains, existing holders can be diluted later
- · Check that a stated cap matches the cap actually enforced in the contract
- · A compromised permission-holding address can also lead to unauthorised issuance