Coins and Shares: the double nature of Cryptocurrencies

in cryptocurrencies •  7 years ago  (edited)

Traduzione italiana qui: https://steemit.com/cryptocurrency/@spesknight/monete-e-azioni-la-doppia-natura-delle-criptovalute

Many people are astonished by the price many Cryptocurrencies have reached.
Their value is much higher than that of traditional fiat currencies accepted all over the world.
It is hard to explain to normal people, far from the Crypto world, why this is happening.
A possible easy explanation could be that Cryptocurrencies are not simply virtual coins, but have a value related to the respective project and it's possible future developments. They are in fact not only coins but also shares.
This view offers also the possibility to distinguish between various types of coins. Some in fact are more currencies than others while others have more of the share nature.
We can classify the various coins and tokens in 4 different categories.
The first category includes the ones that are mostly currencies, thought to be spent in various ways in exchange for products and services. In this category are Bitcoin and Litecoin along with Zcash, Monero and the other privacy coins. Their value and their success will depend heavily on usage driving the demand.
The second category includes the ones that are more tokens, thought to be used in a platform but not as payment method but as a way to use the blockchain technology. In this category are for example tokens like Civic or Patientory. Buying these means more buying a share of the project, and their value is related more to the success of the project than to the adoption of the the coins as a mean of payment.
The third category is a mixture of the two previous ones, tokens that are used both as payment and as means of blockchain utilization. In this category there are Decentraland's Mana, thought to be used to buy virtual land or be spent in a virtual world, or Liquidity Access Tokens, thought to be exchanged for investing in properties or in shares of NASDAQ quoted companies or in Commodities. The success of these coins is also related to the success of the project, but is more related to the demand of the token for buying products and services on their respective platform.
The fourth category is related to the coins used as a platform for creating tokens. In this category are for example Ether, Waves and Neo. Their value is related to the usage for token creation but they can also have value as the coins in the first category.
This division can help in evaluating the fundamentals of the different coins and to explain to people outside of the Crypto world why some coins have so high prices and why some will thrive while others will fail.

Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!