In the current era of Blockchain evolution a new
concept has emerged: tokenization. Tokenization
is an intrinsic part of the Blockchain technology
that serves the purpose of platform identification
and accessibility.
The power of tokens
Every Blockchain platform is powered by tokens,
sometimes also referred to as “coins.” Bitcoin is
a token, as is Litecoin, Dash, and other
currencies that function over a Blockchain. While
tokens can represent money, as in the case of
the above, they can also represent other things.
The demand for a particular Blockchain product
is usually the main determinant of the value and
eventual market price of its token. This is why
there is a variation in the prices of different
altcoins in the Blockchain environment. For
example, Bitcoin is more readily accepted by
merchants than Litecoin, and is consequently
more valuable.
The force behind Ethereum
Ethereum, despite coming after many older
altcoins, remains the third most valuable
cryptocurrency in existence behind only Bitcoin
and the its recent fork, Bitcoin Cash.
Ethereum’s value is largely determined by the
demand for its platform by distributed application
(dApp) developers. Many of these developers
issue tokens to grant access to their services,
essentially building their own Blockchains atop
Ethereum’s platform. In many cases, developers
pre-sale their tokens as part of an initial coin
offering (ICO), and they usually accept
Ethereum’s token “ether” as payment.
In essence, the organic value of a given token or
cryptocurrency is determined not just by the
functionality, but the demand for its Blockchain
product.
Blockchains and their tokens
There are numerous Blockchain products in
existence claiming to offer different solutions to
various problems. Many more are still in the
development. Below are some examples of
Blockchain products and what they do:
Steemit
Steemit is a social network that rewards users
who participate in various ways. The Steemit
token is called STEEM. It is used to reward
content creators and curators of the best
content on the site.
Dash
Dash, which stands for “Digital Cash,” is a fork of
Bitcoin that is fine-tuned for more privacy and
instant transactions. The platform’s token is
called DASH. Dash is also self-funded through its
own Blockchain (a portion of mining rewards
fund the currency’s development) and features a
working governance model.
ZCash
The token for Zcash is called ZEC. ZCash is a
cryptocurrency that grew out of the Zerocoin
project which aims to improve anonymity for
Bitcoin users. Zcash payments are published on
a public Blockchain, but users are able to use an
optional privacy features to conceal the sender,
recipient, and amount being transacted.
WishKnish
WishKnish is a network of social marketplace
communities that allows its users to create
storefronts for various kinds of services. The
platform also permits individuals interested in
discovering products, services and communities
that fit their needs. Participation in activities is
rewarded in the platform’s local token, Knish.
LAToken
LAToken is an asset tokenization platform that
allows users to convert tangible assets such as
real estate or precious art works into tokens,
thereby making them sellable in fractions. The
token that powers the LAToken platform is the
LAT.
Tokens are for identity and investment
The above mentioned are just a few of the
numerous cryptocurrencies and the platforms
that they represent. While the first three are
well-established entities that are listed on major
exchanges, the others are still in their
developmental stages.
The strength and identity of a Blockchain product
is most often represented by the characteristics
of its token.
However, while these tokens stand as the
identity of their respective Blockchains, offering
access to the services or solutions provided by
their resident platforms, they also double as
digital assets and opportunities for investment
depending on how much the community values
their platforms
