Cryptocurrencies are probably the most profitable investment of the last decade. But, in recent years, so many new digital currencies have emerged that supply has exceeded demand, and the price of most of them has stopped rising. It's time to invest in blockchain tokens, the digital equivalent of conventional stocks for investing in IT projects.
However, it is important to know where to invest and a very good example of that knowledge is a very important part is having a bank
Definition of a token
A token is a unit of accounting for assets in all sorts of IT projects, analogous to a stock on a stock exchange. They are issued to raise funding for IT start-ups through the ICO procedure (issuing tokens), crediting, and monetization of additional services for IT project participants.
The tokens are accounted for using blockchain technology and are accessed using special software with a digital signature. This ensures maximum protection of ownership rights to the electronic asset. After all, each transaction contains data on all previous transactions with IT project tokens, and the information is stored by all participants in the network, not on one central server, so the database cannot be hacked.
Tokens are managed using smart contracts (for example, Crypto Miner Token), and their development is usually realized on Blockchain or Ethereum protocols according to the ERC-20 standard.
Properties of tokens
Typically, tokens have the following properties:
are indicative of a share of the equity in an IT project;
They can act as a reward (bounty) for some services to a startup, for example, helping to attract investors by advertising the project, etc;
Act as currency in a closed (IT) system; they can be used to buy services from the project.
Thus, the use of tokens is limited to the specific startup that issued them. They act, for example, as a token for a subway ride. But, as soon as the IT project enters the exchange and starts selling its tokens on it, they can be easily exchanged for cryptocurrency, such as bitcoin. Thus, it is not possible to translate 1 token directly into hryvnia, rubles, or USD. This can only be done through an intermediate link in the form of digital currency, the same bitcoin or ether.
How much 1 token costs in UAH (UAH) or other currency - is determined by the interaction of supply and demand for it in the market, and depends on the success of the IT startup and the usefulness of its services. There have been cases when the exchange rate of tokens after the ICO has risen by hundreds or even thousands of times.
Types of tokens
The following tokens are found on the market today:
Equity tokens that give their buyer ownership rights in an IT project. They are used to attract investment in a startup;
utility tokens, or altcoins as they are called, give their owner a certain benefit within the IT project; for example, they act as game currency that can be exchanged for features in an online game. The most popular altcoins are the projects TrafficX (an analog of Uber, tokens can be used to pay for rides) and MatchPool (an analog of the dating service Tinder, you can buy premium status);
Asset-backed tokens can be exchanged for real goods or services, e.g. a photographer's or programmer's work hours, to which they are "attached" due to asset tokenization;
credit tokens - used for short-term fundraising with subsequent repayment of borrowed funds and interest on the loan. One of the first projects to issue credit tokens was the Steemit network, which guaranteed a 10% surcharge on borrowed funds.
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