What is a token?

A token is an accounting unit that is used to represent a digital balance in a certain asset. Accounting for tokens is maintained in the database on the basis of blocking technology, and access to them is done through special applications using electronic signature schemes.

What are the types of tokens?

• Equity tokens - represent the company's shares.
• Utility tokens - reflect some value within the business model of the online platform (reputation, scores for certain actions, game currency).
• Asset-backed tokens - digital obligations for real goods or services (kilograms of carrots, hours of work of the builder, etc.).

What can a token be provided with?

Directly provided can be only asset-backed tokens. In this case, the token is a digital counterpart of a real (physical) asset or service. For example, one token can be equated to one square meter of living space or the ability to go for one session to a movie theater. The guarantor of the conversion of the token into security is the organization itself, which stores goods or provides services.

What is asset tokenization?

Tokenizatsiya - a process of transformation of accounting and asset management, in which each asset is represented in the form of a digital token. The essence of tokenization is the creation of digital analogs for real values ​​with the aim of quickly and safely working with them. For example, the owner of a bakery creates an electronic accounting system in which he issues digital obligations for rolls - tokens. Having a fairly good reputation, the owner of a bakery can pre-sell rolls, selling tokens on trading floors on the Internet. In this case, any owner of tokens can come to the bakery and exchange one token for one roll.

What is the difference between a token and a crypto currency?

Unlike crypto-currencies, tokens can be emitted centrally (under the control of one organization) and decentralized (under the control of a predetermined algorithm). Processing and acceptance of transactions can also be performed centrally (all servers are controlled by one organization). The formation of the price of tokens can depend not only on the balance of supply and demand, but also on additional aspects (binding to an external asset, conditional emission rules or remuneration). In addition, unlike the crypto currency, the token does not have its own blocking.