Homework | Crypto Academy Season 3 Week 8 - Beginner's Course | Understanding Tokens
š¹Understanding Tokens š¹
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)
A token is a cryptocurrency that represents a specific service built on different blockchains. These tokens make it easy to trade through blockchain technology. Crypto tokens also known as cryptocurrencies, represent a unit of value. Tokens play a specific role in the project's ecosystem. Performed by tokens this function is similar to the function performed by coins. But creating tokens is easier than creating coins.
Tokens are used in a variety of situations, such as purchasing values āāin a blockchain. Tokens that act as indigenous currencies vary within each blockchain. One of the things I noticed while researching tokens created by different blockchain is that most of the tokens are created by Ethereum blockchain.
Example :-
ā¢ Tether - Built on ethereum blockchain
ā¢ BitTorrent - Built on binance smart chain
ā¢ Uniswap - Built on ethereum blockchain
ā¢ WINKklink - Built on tron blockchain
ā¢ Pancakeswap - Built on binance smart chain
2)What is the difference between a token and a coin?
| Tokens | Coins |
|---|---|
| Is a digital asset issued by projects. | Coins are digital currencies created using encryption methods. |
| Tokens do not operate on their own blockchain but as a network. | Operates on its own blockchain. That is the protocol |
| Its owner is given the right to participate in the network. | There is no such methodology in the use of coins. |
| Creating tokens is easy. | coins are difficult to create compared tokens. |
| Tokens are used in activities such as digital contracts. | Coins are used as a payment service in Blockchain. |
| Example :- Bitcoin, Litecoin, Ethereum | Example :- FTX token, Huobi token, Tether |
3)Explain the different categories token listed below and explain its features.
Utility tokens
Security tokens
Equity tokens
Non-fungible token (NFT)
Utility Tokens
Utility Tokens are tokens designed as a way for developers to fund their project. That is, the public can use these tokens to raise funds to run their project. Utility tokens have value only when using a system. These tokens can also be exchanged for other cryptocurrencies.
Security Tokens
Security tokens are symbols similar to ownership shares associated with a company's traditional shares. The value of the security token you purchase is based on the value of the company. Dividends also vary depending on the value of the token. These tokens give the company the right to make decisions and to vote.
Equity Tokens
A token offered by a founder to represent the shares of a company. Holders of such tokens will have the right to vote on the blockchain. Also, if you own a equity token in a company, you will be entitled to a share of the dividends received by that company. These tokens also provide some form of protection to investors.
Non-fungible token (NFT)
NFT is a unique digital asset that cannot be exchanged for other codes stored in a digital ledger. NFT is used to represent items such as audio, photo and video digital files. There are several copies of these digital items and they are available to anyone.
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).
Uniswap is a token with a good market value that everyone knows is coming forward, surpassing other cryptocurrencies. Created by Ethereum blockchain, this token has become one of the most widely traded tokens today. The uniswap project, built in 2018, is the second largest cryptocurrency project in the world by market capitalization.
The Uniswap project is a decentralized project. You can trade cryptocurrencies by linking external cryptocurrencies such as Coinbase and Binance with uniswap. Also uniswap is an exchange that allows trading of different pairs of symbols. Trading here is done through the use of smart contracts.
The uniswap project works as an open source, allowing anyone to create their own decentralized exchange. The main objective of this project is to enhance the decentralized protocol among users by developing cryptocurrency trading in the market.
(These screenshots are taken from coinmarket cap)
Price :- $26.59
24h % :- 0.25%
7d % :- 3.35%
Market cap :- $15.62B
Volume 24h :- $519.64M
19.55M UNI
Circulating supply :- 587,450,148 UNI
Thanks for reading
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@nishadi89 pls wat markdown did you use for your understanding tokens
Hello @nishadi89 , Iām glad you participated in the 8th week of the Beginnerās class at the Steemit Crypto Academy. Your grades in this task are as follows:
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Thank you professor.