Great changes in the world financial market are already here, and these are associated with the emergence of cryptocurrency and businesses related to it. Thus, the total capitalization of the global market grew from $6 billion to $28 billion in just a year. Since the beginning of 2017, the market of crypto-currencies and the digital token has grown about 1,5 times. At the stock exchanges, there are already more than a hundred of different crypto-currencies with their own rates and financial values.
Large organizations are merged into consortia to issue their own currency. Even states make their national crypto-currencies. The technology of blocking has reached such a high level that almost anyone can launch his own cryptocurrency with no problems. In this post, we are going to talk about how to use tokens in block platforms and benefit from blockchain technology.
Tokens are usually used for the following purposes. Some company wants to release a product that needs some kind of internal currency. At the same time, the company needs to conduct ICO (Initial Coin Offering) by pre-selling tokens to investors to collect money for the project. As a result, tokens appear. The benefits here are directly associated with advantages of blocking and beneficial contracts: transparency, security, and distribution.
There are different token types; capital tokens are the most spread ones. These are used to support the network financially. As one can assume from the name, a capital token can be considered as the share of a virtual network.
When exchanging an investment, holders of capital tokens receive dividends as a share of the profits obtained from commissions for user transactions inside the network. Thus, in the case of Samsung, 5% of all good operations are transferred to holders of the token.
As a general rule, digital tokens, just as bitcoin, represent the financial state of a distributed company. Its code is associated with issuing cryptocurrency, storing money obtained from the tokens realization, as well as an agreement with the company on the network development.
Benefits of using tokens
Apart from receiving professional payments, holders of capital tokens usually have the possibility to make proposals for the use of investments. In such a way, they can increase their profit and manage their money in a smart way. In other words, token holders can
- Get a percentage from commissions for conducting a transaction on the corporate network;
- Create proposals on what financial operations are to be performed and vote for them.
For example, if someone would ever wonder, “where can I pay for an essay”, correct the person, because it’s not important “where”, but “with what”!
All in all, while having their money invested in a company or project, holders of capital tokens can manage their money in the most profitable way for them.
Pre-selling custom tokens
In addition to simply managing their tokens, companies can sell user tokens. For performing the operation, organizations need to do the following:
- Publish a document of intentions with the definition of the characteristics of the network;
- Announce a token selling intention to the public;
- Expand the network and establish a high level of security.
Alternatively, they give a part of the token amount to the holder team as a remuneration for the idea;
- Promote the network and market custom tokens to everyone in a row;
- Work on increasing the number of users creating applications for the network and supporting it.
As the network becomes bigger, so makes the demand for the cryptocurrency, which leads to an increase in its cost to the users.
What we think!
Token and bitcoin blockchain terms are widely used in various spheres. However, in the world of finance, these are used to designate a money substitute and a related system. This definition is ideally suited to explain what digital tokens are and what blockchain applications are targeted at. The Bitcoin blockchain and other crypto-currencies use such electronic tokens to implement three types of tasks: lending, selling shares, and monetizing an additional service for network users. In this article, we have considered in detail all these aspects and talked about the ways of obtaining such an internal currency.