Greetings everyone,

I much delighted to be part of the second week of the crypto academy. Also I am grateful for this great lecture from professor @pelon53.

This week’s lecture is on the first part of Tokens. We have therefore been tasked to write on security token, utility token, and equity token with examples each. Before going straight to what we been assigned on I will like to write on what Token is actually.

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WHAT ARE TOKENS

Tokens are simply used to represent a certain currency. It cannot be used for currencies that have legal support. In other words tokens are created to perform multi functions for which they were created for. Also tokens performs specific task in a particular environment. Let’s say in a bar or casino they are used as money there which have higher value but only within that particular environment. They are also used to make investments or used for buying and selling purposes. A crypto coin and a token isn’t the same but people seem to use them interchangeable. A crypto coin uses digital currency in making payments but for token, it is used to trade, invest as a form of a currency.

Also we turn to get confuse as to the difference between Cryptocurrency and Token so I will like to tabulate the differences

CRYPTOCURRENCY	TOKEN
1. They are vital virtual currencies that have their personal blockchain and are used for digital payments.	It uses existing blockchain
2. It is not restricted to a specific environment.	2. They are restricted in a specific environment
3. They are not created with programs	3. It is created with programs used to satisfy its function
4. The functions of cryptocurrency is narrow and they serve as a form of trading	4. They perform multi task
5. They are used to facilitate transactions	5. It is a quality currency used for making payments on a blockchain mostly bitcoin.

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SECURITY TOKEN

A security token is a token that represents financial assets that can be traded. They are also forms of investments that brings about future profits. Security tokens in crypto is sometimes confused with that of the network systems the banks used where you need to be granted access. But rather security token uses the fast speed of blockchain to increase the protection from fraudsters by so doing it gives some benefits to the government. Some examples of security tokens include; Polymath, Swarm, and so on. Before throwing more light on one of the examples, I will to talk on the pros and cons of Security token.

PROS	CONS
1. They promise profit at the end of an investment	1. They are more expensive as compared to utility tokens
2. They provide liquidity to investors	2. There are limitations when it comes to market trading
3. As a result of the usage of the speed from blockchain, it reduces the amount of fraud cases in blockchain.	3. There are also restrictions to investors who aren’t endorsed

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POLYMATH SECURITY TOKEN

It is a security token that was launched in 2017. The CEO of Polymath security token is in the person of Kevin North and was founded by Trevor Koverko and Chris Housset which have their headquarters based at Toronto. The polymath token uses its decentralized platform to ease the distribution of security tokens. This is made possible by the use of developed protocols such as ST-20 protocol which is from the Ethereum blockchain. Over the years, Polymath has seen an upward movement towards a recognized companies.

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UTILITY TOKEN

A utility tokens are tokens that performs a specific task. That is they might be used to undergo a special service or to receive solutions of services. They make up the large population of the ICOs issued. They are basically used by companies to increase the interest in their products. Also they are used to create value in services provided in blockchain. With Utility tokens, they are basically used to create products. Examples of utility tokens include; funfair, timicoin, golem and so on.

PROS	CONS
1. The token value does not relate to the current value of the company	1. It is expose to high rate of scam
2. They produce good products	2. There are no profits guaranteed
3. They are less expensive	3. There are no regulations in this type of token

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TIMICOIN UTILITY TOKEN

It is a utility token which is from the TimiHealth platform. It was developed to as a way to get service network. It is used to process data within a network. It operates through the TimiHealth application and the Timi cryptocurrency wallet. This token has the ability to gather around all information from statistics, health and so on, manage and scrutinized this information. The Timi wallet is connected with this token and it is accessed through smart contracts of the TimiHealth.

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EQUITY TOKEN

These are tokens that functions more like that of traditional assets. That is with this token, the individuals involve possess some ownership in it. They share same protocols as the security tokens. In this token type, the amount of tokens you have calculates your percentage of ownership. They are sometimes referred to us third-party properties. They come in several forms like; stock, ventures, future tokenized and so on.

PROS	CONS
1. There is much profit in equity token	1. There might be problems in sharing of profits
2. There aren’t fee charges in market transactions	2. It is also expensive since it shares some protocol with that of security token.
3. When there is growth, there is equal share of profits	3. Approval is needed before a transaction is carried out

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THE ELEPHANT PRIVATE EQUITY TOKEN

It was founded by Idan Miller and CEO been Chaim Schiff. It has been created since 2018 with revenue sharing as the security type. It also uses the ST-20 that’s the Ethereum as the protocol. Its payment options is done through Bitcoin. It is an operational platform 200 million dollars’ worth of shares. The company has 12 employees who are among the worlds’ top secondary markets. Funds from this token is used to turn the token into a leading global platform.

Conclusion

Tokens are really interesting facts about the crypto world. I really enjoyed learning and making more research about the various token types and their respective examples. I therefore cannot wait for the second part of this Lecture.

Thank you.

To the attention of professor @pelon53