Many people buying and selling tokens or cryptocurrencies do so for the popular purpose or use case–to exchange instantly for some profit or save until the value hits the sky like Bitcoin.
There is more.
It is important to know about the unpopular use cases of tokens as well.
Everybody seems to know about cryptocurrency today. Thanks to the relentless pioneers. A baby in the womb can define cryptocurrency now. If at all you don’t I’ll dedicate the next paragraphs to define and explain:
To simply put, cryptocurrency is a digital currency–different from the digital value of your fiat money currently in some bank account regulated by the government.
Cryptocurrency is a complete decentralized system. The “crypto” in “cryptocurrency” refers to a complicated cryptography that enables the creating and processing of digital currencies. These digital currencies are called tokens or coins–intangible coins, while the process is popularly known as mining.
The idea is to liberate people from poverty caused by government manipulation and its absolute power over the global economy and banking system through the use of blockchain technology.
Bitcoin or BTC token is the most successful project. There are other tokens as well. They are categorized as alternative coins or altcoins such as Ethereum (ETH), yearn.finance (YFI), Maker (MKR), AUTO, BNB, etc.
There are popular authorized platforms such as Binance where tokens can be bought and sold between users (peer-to-peer) and traded as well as in the case of fiat currencies against each other on foreign exchange (forex).
That’s one use case though which is the most popular. Here are other use cases meant to serve a different purpose from that of money:
- An example is to acquire securities or stocks. Some tokens are issued as part of an initial coin offering (ICO) that represents a stake in a blockchain or decentralized finance (DeFi) project
- The dot.com era is gradually fading away. You can own a decentralized website (think of Web 3, that’s another subject by the way)
- This use case allows people to obtain decentralized Domain Name System (DNS) service for Internet addresses as well as a decentralized file sharing system. These are known as utility tokens
Tokens are mostly transacted the same way so it’s important to read about the project before buying or selling.
Your take home on unpopular use cases of tokens:
- For Securities/Stocks/Shares
- Utility: DNS
Have a beautiful day 🙂
Thank you for reading this piece on TechTouch. Please share today’s edition with your network on WhatsApp, Telegram and other platforms, and feel free to leave comments or any suggestions. We’ll like to learn from you as well.
By Elijah Christopher