Crypto Academy Week 10 - Publication of assignments for [@ pelon53] by @ojoyceoma

I am grateful to @pelon53 for the lecture delivered on crypto token, it was easy to understand and i got a lot of knowledge. Below is my task for the lecture.

In this assignment I will be answering the question what is security token, equity token and utility token with examples

Tokens basically aid transaction in the financial market, they can represent the value of an asset digitally. Tokens can be issued by cryptocurrency developers or even be likened to company share. Tokens are created or built on blockchain such as Ethereum, the ERC-20 which is main or commonly known.

A token created perform the function to which it was created.

SECURITY TOKEN

Source

A security token is a token wwhich can be used to represent assets with value, like real estate or a car. The ownership stake of the investors of a security token are preserved on the blockchain ledger. Security token can simply be said to be token that can be used to show value of assets. The value of an asset can be transferred to the token created.

Examples of security tokens:
Sia funds, Bcap(Blockchain capital) the science block chain, and others.

EQUITY TOKENS

Source

Equity tokens are tokens issued to investors upon buying an initial coin offering, these tokens are sent to the investors blockchain hosting account or wallet. They can be liken to buying the share of a company and having the shares sent to your demat account but then here we are dealing with crypto token and the tokens are sent to the investors wallet.

Example: U.S.-based biotechnology company Quadrant Biosciences Inc. tokenized all of its equity in the form of Quadrant Token and offered 17 percent of its diluted equity via a token sale. It successfully raised over $13 million through the issuance of common shares in digitized form at $1.25 per share. The Quadrant token that resides on its native blockchain represents traditional equity.Source

UTILITY TOKEN

Source

When it comes to a utility token, developers of a cryptocurrency can issue a crypto token called utility token to fund the development of their cryptocurrency, and these tokens issued can be used to purchase goods or services which are offered by the issuer of the crypto token.

Example: For example, Basic Attention Token (BAT), Ethereum ERC-20 standard-based token is used for the interactions with the Brave internet browser. BAT tokens are used for advertising blockage, specific changing type of viewed ads or to earn tokens for viewing it. Source
Others utility token examples include: Timicoin token (TMC), Sirin labs token (SRN), Golem >token (GNT).

Thank you once again @pelon53, i hope to keep learning from you.