Security token is a moveable or portable gadget that confirms person's identity through electronic means by supplying some information which are personal. The holder of security token connects it to a system in order to have access to a network system. It operates like an electronic key to access things. They can be use instead of password or in addition to password to prove the identity of the owner. Security token are issued by Security Token Service. In addition,some security tokens has audio features or capability which are made for people with visual difficulties.

Security token may be in differs of form which includes USB token,programmable electronic key fobs(they activate devices through the use of remotes like in the case of gaining access to a car),the wireless Bluetooth token and also the hardware token(this contains CHIPS).

Hence,security token connected interface with USB ports,radio frequency identification,Bluetooth and the near field communication.

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Examples of security token are keycards

which are wireless that are used in getting access or opening a door. This keycards are used in place of the normally metal keys which we are familiar with. The keycards are electronically made which means they are made in respect to a specific door,thus, two doors cannot use the same keycards.

Also,tokens generated by banks are also example of security token. Banks are sensitive network system the banks uses it to prove that the customers are who they claim to be in case of online banking. Cryptographic keys are also stored by security token, they are made use of in cryptocurrency services like the bitcoin. Security token also make use of biometrics(fingerprints or digital signature)

Security token can be hacked or stolen and also can be lost. This normally occur when the owner unintentionally or mistakenly gives sensitive or vital information to the third party (unauthorized person) who then gain access to the system.

Security token has different types which includes connected token which makes use of smart cards,the contactless token,disconnected token,the single sign-on software token etc.

UTILITY TOKEN

Utility token is used as a protection for involvement in Mass or large sales for the purpose of raising funds for on a project. Its also a unique token that assist in financing projects for project development groups and companies. A technique for acquiring capital to finance a project. It guarantees future access to the service and product of a company.

The utility token serves a an essential tool when company want to invent a coupon that can the replaced(in the future) for access to it products and services. In blockchain and cryptocurrency, the name of the utility token involved in the project development is ICO which means Initial Coin Offering which is a medium where cryptocurrency projects can get finance required for the development. ICO gives token or cryptocurrency of new projects in exchange for fiat coin or Cryptos.

People buys utility token in various cryptocurrency in which they pay a specific money on the token they desire and the token are hereby awarded to them. The tokens are aimed to an address which is controllable by the buyer. Hence, the buy can make use of those token in accessing the service of the project to be developed in the future.

Examples of utility token is GOLEM

which creates economic system that gives people opportunity to lend the computing power that are available in them by which people can make use of the power for different tasks. Also the BAT(Basic Attention Token),this utility token gives access to different BAT services in which contact writers and publishers are paid.

Utility Tokens are prone to certain risks if they are used in excess because the value of the tokens cannot be increased through natural mechanism and if eventual their is project failure, the tokens will become valueless. Also liquidity issues are associated with utility token because project might not reach the required fund for it development.

EQUITY TOKEN

This refers to the formation,creation or establishment and issuance of token or coin which are digitalized which portrays equity share in a company. Equity token is a easy to raise fund in which companies issues in the likes of digital asset like the crypto token and coin. Equity token is like a traditional stock asset which makes holders of this token to have ownership in their investment.

The token is the representation of the percentage the holder have in an investment. The equity token became most used when the blockchain system was decentralized that enables cheaper and easy creation,issuance and allocation of digital coins or token. Just as the way one subscribe or buy a company's share during public offer on the stock exchange, the shares are credited to a Demat accoun, equity tokens also follow the same procedure only that those shares are in digital form which can be the crypto coins or crypto tokens and they are credited to a blockchain hosted account.

Companies offers equity token to investors through Equity Token Offerings (ETOs). Equity Token gives it holders the eligibility to dividend and to vote. Also appraisal right,subscription right and share certificate could be included. Most businesses are deciding to raise fund through initial coin offering which allocate to investors token shares.

Example of equity token can be seen in a biotechnology company in which all their equity were tokenized in form of quadrant token which were offered via a token sales.

Also a US based company of bioscience decided to issue shares to the public through digital form which the price of the shares is $1.25 per share,the company was able to raise above $13 Million.

@pelon53