Crypto Academy Week 2 Season 2 Homework Post for @pelon53

WHAT IS TOKEN?

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Token can be any representation of as something factual eventful significance or felt. Simply put, whenever a gift or anything is given in correspondence to an effort is a token not necessarily money but anything representing money.

A cryptocurrency coin, such as Bitcoin, Bitcoin Cash, Ethereum, and others, can exist without a network. Outside of their native world, they can be used as a type of currency. These are the “cryptocurrencies” with which we are all acquainted.

In crypto world, a token is when anything like voting rights value or anything is representing anything in the ecosystem of the blockchain of a cryptocurrency.

There are three types of tokens.

1- Security tokens
2- Utility tokens
3- Equity tokens.

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WHAT ARE SECURITY TOKENS?

As its name suggests, this type of tokens' function is to regulate authorities and other bodies.
Security is a major concern for individuals and companies too. Without an assurance of transparency when going making a transaction you feel insecure. This is a major reason why a security token was created to tackle this sort of problem.

Security tokens are a type of cryptographic assets with similar features as an another cryptocurrency
This means you can gain profit by investing in a company's security token and at the end you are paid interest or dividends. These tokens are actually issued as a type of investment, these security tokens are tied to financial values, which allows the tokens to work with the blockchain technology; working with the blockchain technology allows their digitization.

Why we need security token.

Security tokens provide companies and individuals with more transparency when making an investment.Security tokens act as an insurance.During transactions, the investor know that there is a security token in place that has already checked to see if it is safe, so there is a kind of assurance that you will not be cheated.Security token protect corporations too. Security tokens do not only provide insurance for individual they also provide for corporations.

Example of a security token.

The tzero security token :

Tzero is a security token that was launched to address the regulatory issues associated to ICOs .
The tzero is a blockchain based technology.This particular security token was launched by internet retailer overstock.

What does tzero do?

Tzero ensures that when using biometrics to access your wallet, only you and your face can have access to it.It also gives corporations a chance to register and issue tokenised assets onto a blockchain.

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What is a Utility Token?

A utility token is another type of token in the cryptocurrency space and they are the most popular type of cryptocurrency tokens. A utility token is basically a token that has utility within an ecosystem and gives holders of the token access to services and also can be spent within an ecosystem. Binance is a well-known ecosystem in the cryptocurrency space. Simply put, utility tokens are meant to have use case within an ecosystem. The Binance exchange needs no introduction as it is one of the biggest cryptocurrency exchanges at the moment. Binance Coin (BNB) is a good example of a utility token which is a utility token of the Binance ecosystem.

Benefits of Utility Tokens

• A utility token is a token that powers a blockchain ecosystem
• Utility tokens have uses cases and real utilities within an ecosystem
• Utility tokens are created around community and users in mind
• Utility tokens can be used to lower fees for transactions in an ecosystem
• Utility tokens can be used to pay for services in an ecosystem

Binance Coin (BNB)

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Binance needs no introduction as far as cryptocurrency is concerned. BNB is occupying the number 3 position on coinmarketcap. Binance is one of the biggest ecosystems in the cryptocurrency space and their BNB token is the 3rd largest cryptocurrency by market capitalization. Over the past few years, Binance has grown to become an ecosystem in itself not just the Binance centralized exchange. The Binance ecosystem comprises of Binance Chain, Binance Smart Chain, Binance exchange (CEX), Binance DEX, and a variety of other crypto services within the Binance ecosystem.

The Binance Coin (BNB) Uses

• BNB is a utility token of the Binance and powers the Binance Ecosystem
• On the Binance Chain, Binance Coin (BNB) is used to fuel transactions
• On Binance exchange, Binance Coin (BNB) is used for paying for fees
• BNB is used for making in-store payments
• BNB is used for paying for services within the Binance ecosystem.
• BNB is used to purchase tokens other tokens on the Binance smart chain

BNB Markets/Exchanges

Since BNB operates on the Binance ecosystem, the main exchange that BNB can be traded on is the binance exchange with a lot of volume present. BNB can be traded on other exchanges such as Binance, Kucoin, FTX, Poloniex and Gate.io.

What is Equity Token? And explain an example.

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When we refer to Equity, what come to our mind is equality and fair sharing, but in this case we may be looking at the percentage ownership of an asset which likely places the investor in the ownership status. Most times, the property or asset in questions maybe a third party assets but because we have some percentage of stake in it, it legally grants us ownership in the asset or investment.

Therefore when we buy into an asset even when not in wholesome, this equity tokens try to tell us the ownership percentage investment we’ve got. Over time, this kind of token allows investors to makes investment across so many assets, hence having wide spread with the little capital available to them. Funnily, to show us how regulated it is, it shares almost the same protocols like the Security Token and the other hand, the security token protocols are seen to attend to all required actions to be taken in the equity token.

Some would say during a company’s startup process that equity tokens are part of assets given to investors who invested and becomes part of voting and decision making team of the company. These tokens are secured and make them get more involved in the development of the company and interest and rewards given in form of incentivizing them in line with market performance. This equity tokens bought by this investors can either be made through its public or private placements via its regulatory entity.

Example of Equity Token _ Neumark

A typical Example of the Equity Token is the “NEUMARK tokens” which simply means New token. This runs on the Ethereum blockchain which allows a number of companies and investors to assemble in its Neufund platform and this determines the market capitalization of the platform. When an investor invests in the platform, it is seen that he gets rewarded with NEU in equivalent proportion of investment. When there’s also a successful transaction done in the neufund platform, a certain percentages goes to the platform and about 2% distributed amongst the equity token holders. Remember to be an active reward receiver; you need to have NEU in your personal wallet which is linked to your Neufund account with other verification details in place.

Conclusion

The context and development of this research work results in the evaluation of each and every one of these tokens that offer interesting services for the user and companies which we can see offer services with smart contracts we will see that there is an interaction in terms of centralization and decentralization is the tokens mentioned some also offer important services and even control of your token and decision making power. this means that it is very interesting each and every one of the projects because they adapt to your need and are very interactive thank you very much a big greeting to everyone