Crypto Academy Season 3 Week 8||Assignment post for Prof@reminiscence by@cinnymartins|| Understanding tokens.
1)What do you understand by Token and give an example of at least 5 tokens and identify the blockchain it is built on. ( give at least 3 different Blockchains)
2)What is the difference between a token and a coin?
3)Explain the different categories token listed below and explain its features.
Utility tokens
Security tokens
Equity tokens
Non-fungible token (NFT)
4)Make your own research and write extensively on any token you listed in question one. (Must include features of the token, the aim of the project, Use cases).
1)What do you understand by Token and give an example of at least 5 tokens and identify the blockchain it is built on. ( give at least 3 different Blockchains)
Ordinarily ,a token is a device substituting a currency created for the reason for gaining access to the network.
By ways of laying foundation ,the launching of a new project does not necessarily means that a new blockchain would be built.
In creating a new project like a token ,it is basically established on a pre-existing blockchain . If this is the case , it means that protocols are bycotted for instance the bittorent token was built on the TRX blockchain . Apart form the afforementioned , there are many other tokens built on an already existing blockchain.
A token by way of definition are basically digital assets created by individual or organisations with the aim of empowering its users by delegating measure of authority to those users to distribute dividends among other. Tokens are electronic assets built on pre-existing dependent blockchain that makes it possible for the creation of other cryto assets.
Tokens built on pre-existing blockchain are bound to act within the precepts of such blockchain. They are created for countless reasons which include investment purposes stores value and take profit in the future and also to makes transactions. Investors of these tokens are accorded a measure of relevence in the system in the sense that they reserve a level of decision making right as well as voting right in the blockchain system.
| Tokens | Blockchain |
|---|---|
| Uniswap | ETH Blockchain |
| BTT(bit torrent) | Tron Blockchain |
| Ereripedia | EOS Blockchain |
| Aave | ETH Blockchain |
| Tether | ETH Blockchain. |
2)What is the difference between a token and a coin?
The two terms are often used interchangably by new traders but I will be highlighting the difference between the two for clarity purpose.
A token can work on another blockchain different from the one it was created but a coin can only function on that blockchain upon which it was created.
A coin is built basically to be accessed as a medium of transaction while aside from running transactions tokens can serve other purposes.
The members of public get to know about tokens through initial coin offering process while coins get to be famous through the mining process.
Tokens exist in the platform of another Blockchain while coins exist in its own platform.
There are not much complexities in the creation of a token as they are usually established relying on an already existing Blockchain but this is not the same with a coin as they are built from the scratch.
Tokens are dependent while coins are independent.
One cannot use a token to buy a coin while coin can be used to purchase a token.
Finally, they offer different values within the system upon which they were created.
3)Explain the different categories token listed below and explain its features
Utility token
This type of token is often established to advance a project in the Ecosystem. Its uniqueness lies in its ability to be used as a medium of payment. Examples of this tokens are Basic Attention Token (BAT). Users access this token through exchange of tokens from other users. And through the process of initial coin offering, the organisation gets to raise capital for investment in the system. Also, with this token, holders are granted permission to the products and services of the Blockchain.
Some of the features of this token are:
- It exist in an already existing Blockchain.
- Holders are granted permission to the products of the Blockchain.
Security tokens
This type of token can be likened to a traditional contract within the Blockchain system. Its unique feature is that it can be used as collateral in the system. Under this type of token, the link connecting the digital tokens and the traditional assets remain unbroken. The benefits of its owners can be attributed to owning a share in the traditional companies. Investing in security token gives investors maximum right in the decision making of the organization and voting right as well.
Some features of this tokens are:
- It is built on a Decentralised Blockchain which allows transparency in the system.
- It is used to reward investors.
Equity tokens
These are used to symbolize owner's right over an asset. It gives owners edge towards receiving dividends from an ongoing project in the system. These tokens share similarities with security token in the sense that they are like traditional assets. It is a symbol of contribution an owner makes in the form of a capital of which the dividends is equivalent to the contribution; this gives the owner an edge to making higher benefits.
Some of the features of this token are:
- Both company and its investors derive value from it.
- It sometimes come in the disguise of contract and real estate.
Non fungible Token (NFT)
The uniqueness of this token lies in its transferability, indivisibility and scarcity. They are unique cryptographic tokens portrayed by the unique prints within the system. The rarity of this token depicts and speaks loudly in its value which placed it on the higher view.
Some features of this token are:
- These token lack the ability to be exchanged.
- It can be used for whatever purpose the owner desires as long as this purpose runs in hand with the precepts of the Blockchain.
4)Make your own research and write extensively on any token you listed in question one. (Must include features of the token, the aim of the project, Use cases).
Bit torrent token
The token I chose to research on was BTT.
Bittorent is a token built on the Tron Blockchain and launched in the year 2019. It was developed by Bram Cohen and the Bittorent foundation. It got popularized through the initial coin offering process.
The total market supply of the token was 990,000,000,000. Users started acquiring the token through different means in the same year it was launched. It is a well known peer-to-peer file sharing platform and moreso a Decentralised network. It was released February 2019 under the TRC-10 network and is currently being ranked as the world largest communication protocol.
Cohen the founder of Bittorent said the token was designed to overthrow entertainment industries who has proven to be incapacitated in facilitating a speedy network.
There are 990,000,000,000 bittorent total supply as recorded in its whitepaper and out of the this number, 6% was made available for public token sale, 20.1% was reserved for airdrop, the Tron foundation was awarded 20%, 2% is down for private token sale, the Bittorent foundation holds 19%, 4% of the supply goes for partnership activities, 9% in a seed sale and finally 19.9% if the supply stayed with the BTT system.
As at the day this operation was carried out, the rate of 1 BTT was= $0.004155
And from the screenshot above, the token is ranked 49
Market cap=$2,742,141,581.72
As at the day and time this operation is being carried out, the price of bittorent dropped by 4.09%.
Aim of the project
To totally disrupt the legacy of entertainment industries who are slow in obtaining consumer's content.
To bypass rigorous processes and enhance distribution of contents amongst internet users directly.
To launch out into paid services.
Enhance bittorent speed which would facilitate download speed.
To employ the presentation of security measures.
Organize a permanent file storage.
Features of bittorent
- It has a Decentralised network.
- It became one of the fastest growing and popular tokens.
- It is created on an already existing Blockchain which is Tron.
Conclusion
Before now, I have one of those who use token and coin interchangeably but courtesy of this lecture I have learnt the difference between the two terms and in addition to that, I have also learnt tokens being built in a pre existing Blockchain which makes its creation more easier.
Hello @cinnymartins, I’m glad you participated in the 8th week of the Beginner’s class at the Steemit Crypto Academy. Your grades in this task are as follows:
You have produced an excellent work on token. Thank you for completing your homework task.