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Blockchain Token Definition

Blockchain - Wikipedia

Blockchain - Wikipedia

For other uses, see Block chain (disambiguation) . Blockchain formation. The main chain (black) consists of the longest series of blocks from the genesis block (green) to the current block. Orphan blocks (purple) exist outside of the main chain. A blockchain [1] [2] [3] originally block chain [4] [5] is a continuously growing list of records , called blocks, which are linked and secured using cryptography . [1] [6] Each block typically contains a hash pointer as a link to a previous block, [6] a timestamp and transaction data. [7] By design, blockchains are inherently resistant to modification of the data. Harvard Business Review defines it as "an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way." [8] For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority. Blockchains are secure by design and are an example of a distributed computing system with high Byzantine fault tolerance . Decentralized consensus has therefore been achieved with a blockchain. [9] This makes blockchains potentially suitable for the recording of events, medical records, [10] [11] and other records management activities, such as identity management , [12] [13] [14] transaction processing , documenting provenance , or food traceability . [15] The first blockchain was conceptualised in 2008 by an anonymous person or group known as Satoshi Nakamoto and implemented in 2009 as a core component of bitcoin where it serves as the public ledger for all transactions. Continue reading >>

What Is A Token And What Is It For?

What Is A Token And What Is It For?

After bitcoin and blockchain, it is now time to get acquainted with another novel concept brought about by the digital economy: The token. What is this concept that is leading some people to speak about new discipline, tokenomics? In the digital world, minting currencies is an activity that doesnt seem to be restricted to central banks anymore. Bitcoin is the best example of how, from a private environment, a blockchain-based virtual currency can be rolled out in the market, albeit subject to many limitations due to the lack of a legal framework to regulate it. But bitcoin was just the beginning of a fully-fledged revolution, the second step of which might very well be the tokens. A token is actually nothing more than a new term to make reference to a unit of value issued by a private entity. Although tokens bear many similarities with bitcoins (they have a value attached to them which is accepted by a community and are blockchain-based), they serve a much broader purpose. Tokens are more than a currency because they can be used in a broader range of applications. Also, virtually all tokens rely on Ethereums blockchain protocol, which, according to experts , is more complete than bitcoins blockchain. According to William Mougayar , author of The business blockchain , a token is a unit of value that an organization creates to self-govern its business model, and empower its users to interact with its products, while facilitating the distribution and sharing of rewards and benefits to all of its stakeholders. This is indeed a revolutionary concept. But, what are tokens good for? Within a private network, a token can be used to grant a right, to pay for a job or to transfer data, as an incentive, as a gateway to extra services or a better user experience In the words of Cr Continue reading >>

What Is An Ethereum Token: The Ultimate Beginners Guide

What Is An Ethereum Token: The Ultimate Beginners Guide

What is An Ethereum Token: The Ultimate Beginners Guide Angel Investors, Startups & Blockchain developers... To a beginner, the entire concept of Ethereum and Ethereum token can get very confusing very fast. The idea that Ethereum not only has its own currency (Ether) but also has tokens on top of that which can act as currency themselves, can be a little mind-boggling. Before we even begin understanding what Ethereum tokens are all about, its important to grasp some basic concepts. The entire Ethereum network is a giant mass of nodes (computers) connected to one another. In fact, the entire network can be visualized as a single entity called the Ethereum Virtual Machine or EVM for short. All the transactions that have happened and will ever happen in this network are automatically updated and recorded in an open and distributed ledger. So what is the advantage of this? Before we explain that it is important to know what a smart contract is. Smart contracts are how things get done in the Ethereum ecosystem. When someone wants to get a particular task done in Ethereum they initiate a smart contract with one or more people. Smart contracts are a series of instructions, written using the programming language solidity , which work on the basis of the IFTTT logic aka the IF-THIS-THEN-THAT logic. Basically, if the first set of instructions are done then execute the next function and after that the next and keep on repeating until you reach the end of the contract. The best way to understand that is by imagining a vending machine. Each and every step that you take acts like a trigger for the next step to execute itself. It is kinda like the domino effect. So, lets examine the steps that you will take while interacting with the vending machine: Step 1: You give the vending mac Continue reading >>

Understanding The Difference Between Coins, Utility Tokens And Tokenized Securities

Understanding The Difference Between Coins, Utility Tokens And Tokenized Securities

Understanding the difference between coins, utility tokens and tokenized securities How the blockchain disruption is shaking statusquo The recent number of Initial Coin Offerings (ICOs), the enormous amount of money theyve raised, and the speed with which they did it, has set off the alarms for funding industries from Venture Capital firms to government bodies. The last 2 months have seen spectacular ICOs success, but also caused a lot of confusion for traditional funding institutions. People are scrambling to understand exactly what an ICO is & how they can use it to their own advantage. To name a few: Bancor (+$150 Million), Status (+$200 Million), Civic (+$33 Million), Tezos (+$200 Million), EOS (+$200 Million). The recent SEC announcement to consider ICOs as securities could actually be a good thing since it highlights the importance of Initial Coin Offerings (ICOs) as a new viable way to raise funds. It highlights the need for a new regulation. Balaji S. Srinivasan wrote a great piece on tokens back in May and Tim Draper recent post on Linkedin referring to his open letter to the SEC has opened up a large discussion on wether token sales should be considered as securities. In planning an ICO for a project of my own, Ive done a deep dive into ICOs. One of the most important conclusions I found: there are 3 main types of tokens. Whether these 3 types of tokens are securities remains unclear as their technical differences are blurry. Thats why a new regulation might be needed to let new innovations flourish. Tim Draper mentioned in his open letter: If the purpose of a token is for societal transformation, and all proceeds go to the support and development of the token, it need not register. These are digital currencies like Bitcoin in which encryption techniques are Continue reading >>

A Primer On Blockchains, Protocols, And Tokensales

A Primer On Blockchains, Protocols, And Tokensales

A Primer on Blockchains, Protocols, and TokenSales Total market cap & 24hr trading volume of all cryptocurrencies over the past 4+ years (via CoinMarketCap ) Blockchains are changing the foundation of the global economy, and everyone is freaking out. Opinionated tribes are invoking civil wars and forking into new tribes. Multiple heated battles are happening simultaneously (mostly on social media) while only a few people on the outside understand whats going on. Even the terminology being thrown around is confusing; theres been a rapid evolution of new technology that has resulted in a lack of lingo consensus. What is an ICO vs. a token sale vs. a TGE? Are coins, tokens, and cryptocurrencies the same thing? What exactly is a protocol, DAO, dApp, etc Still, a growing number of people are realizing that there is a way to transfer assets to each other securely, reliably, publicly, irreversibly, and globally without the need for a central authority. Marketplace corporations that profit from buyer/seller transactions (like Uber, AirBnB, eBay, Amazon, etc) are paying especially close attention. Weve entered a world where trust is moving toward distributed networks of machines that no one person, group, corporation, or government owns. These networks have rock-solid data integrity, zero downtime, and financial incentives for anyone who participates. How we do business with currency, credit, contracts, real estate, computing, communications, fundraising, and pretty much anything else you can think of is changing. Its happening right now, and its happening fast. Simply put, a blockchain is a very long list of transactions stored on a network of computers (i.e. a distributed ledger). As an illustration, imagine writing on a piece of paper that resulted in thousands of other piec Continue reading >>

What Is A Token Sale (ico)?

What Is A Token Sale (ico)?

Smith + Crown has developed a handout on ICOs. You can download it here: smithandcrown_ico_handout_v2.0.(1) La blockchain et lavenir du secteur des assurances ICOs (Initial Coin Offerings) have become a popular way to fund cryptocurrency projects. An ICO is an event in which a new cryptocurrency project sells part of its cryptocurrency tokens to early adopters and enthusiasts in exchange for money today. ICOs provide a way for cryptocurrency project creators to raise money for their operations. Most ICOs raise money in Bitcoin or other cryptocurrencies. The ICO usually takes place before the project is completed, and helps fund the expenses undertaken by the founding team until launch. For some of the larger projects, part of the ICO money goes into a foundation that provides ongoing support to the project. They also work as an initial distribution model for the cryptocurrency tokens, especially those with a proof of stake consensus algorithm. The ICO participants are invested in the success of the project. They can help get the word out and raise awareness in the broader community. They also provide early liquidity for the cryptocurrency tokens when they start trading. The ICO participants are also usually motivated by a profit potential if the project takes off and the tokens become worth more than the ICO price. ICOs have been compared to Initial Public Offerings (IPOs) of corporations. There are some notable similarities both of them are used to sell a stake and raise money, and both have investors who see the potential and risk their capital in order to make a potential profit. However, there are significant differences as well. ICOs are mostly supported by early enthusiasts and not professional investors. In that respect, they are similar to kickstarter campaigns Continue reading >>

A Gentle Introduction To Digital Tokens

A Gentle Introduction To Digital Tokens

Digital tokens have come to the fore recently, firstly with excitement about cryptocurrencies such as bitcoin, then with digital tokens being used to represent different assets on a blockchain. What are they? How can you digitise a token? Why is it important? When I hear the word token I think of round plastic things like a casino chip, or something which I can use to exchange for a beer under a specific system or in a specific marketplace. We will explore the original usage of the phrase digital token, then take a look into the world of cryptocurrency tokens, differentiating between blockchain-native tokens like BTC on Bitcoin or ETH on Ethereum , and asset-backed tokens like IOUs on Ripple. When you enter an email address into a website to join a mailing list, youre often asked to check your email and click on a link. The link looks something like this: ?token=4bdebebc-135b-4748-b7ab-25b31a285df8 In this case, the token is this string of characters which was sent to you. Its a unique string of characters, which, when you click on it, tells the server that yep, the guy definitely got the email, so the email account is definitely his.. So, the website sent you a token, and you sent it back, proving you had control of that email address. However, token is now being used in an entirely different way to mean other things in cryptocurrency land. Lets explore. Cryptocurrency tokens dont exist as a string like we saw above (if they did, they would be easy to copy), but rather they exist conceptually as entries on a ledger (a blockchain). You own these tokens because you have a key that lets you create a new entry on the ledger, re-assigning the ownership to someone else. You dont store tokens on your computer, you store the keys that let you reassign the quantity. I prefer t Continue reading >>

Differences Between Cryptocurrency Coins And Tokens

Differences Between Cryptocurrency Coins And Tokens

Basics you need to know By Aziz, Founder of Master the Crypto No responses This article explores the subtle differences between cryptocurrency coins and tokens, and why the term cryptocurrency is a misnomer. Cryptocurrencies can be extremely hard to wrap our heads around, especially since their underlying technology the Blockchain is shrouded in computing language and terminology that is technical in nature. This is a huge impediment to many who are interested in the crypto space. But do not worry! Well guide you in understanding key cryptocurrency concepts that is great for you to know. (See more: Guide to Common Crypto Terms ) Lets start with understanding the definition of cryptocurrencies. Cryptocurrencies are digital or virtual currencies that are encrypted (secured) using cryptography. Cryptography refers to the use of encryption techniques to secure and verify the transfer of transactions. Bitcoin represents the first decentralized cryptocurrency, which is powered by a public ledger that records and validates all transactions chronologically, called the Blockchain. (Read also: Upcoming Bitcoin Hardforks You Should Know: Bitcoin Gold & Segwit2X) Although many cryptocurrencies have existed prior to Bitcoin, its creation marks an important milestone in the realm of digital currencies, due to its distributed and decentralized nature. The creation of Bitcoin precipitated the expansion of a lush and more diverse ecosystem of other coins and tokens, that are often regarded as cryptocurrencies in general, even when most of them do not fall under the definition of a currency. (See also: 4 Reasons Why Now is the Best Time for You to Invest in Cryptocurrencies) Coins vs Tokens: Categorization of Cryptocurrencies It is important to note that all coins or tokens are regarded Continue reading >>

Back To Basics For Blockchain Tokens? - Coindesk

Back To Basics For Blockchain Tokens? - Coindesk

Finally, theres something that virtually the whole cryptocurrency sector can agree on: digital tokens are hot. Several recent token issuanceshave sold out in minutes or even less and many more are in the pipeline. And while the potential is intriguing, especially for some use cases, the current enthusiasm is disconcerting, leading many observers to dust off the word 'bubble'. How long this can go on for is unclear. But recent deals reveal what could be the beginning of an encouraging trend away from a focus on easy financing and toward one that prioritizesutility. When the initial coin offering (ICO) craze started, it was hailed as a more democratic way to raise funds for startups. It allowed blockchain-based businesses to bypass the traditional venture capital (VC) and bank lending routes by realizing a type of crowdfunding that gave participants the right to use the service and/or participate in future profits. The more that people wanted to use the service or believed in its profitability, the higher the price of the token would rise. The runaway success of some issuances encouraged speculators to bet that others would have a similar success, and when institutional investors started to get involved, the relative scarcity of tokens compared to the amount of funds looking for high-return opportunities pushed the prices up even further. The fundamentals of the underlying projects seemed to dwindle in significance, and firms with no revenue model or even working product found it relatively easy to raise funds. However, the recent news around three unusual digital token issuers reveals a shift in priorities, as all of them already have working products and VC funding . So, rather than seeing token sales as an alternative to more rigorous financing methods, all seem to fo Continue reading >>

What Is A Blockchain Token? Intro To Cryptographic Tokens

What Is A Blockchain Token? Intro To Cryptographic Tokens

Native tokens of state of the art public & permissionless Blockchains like Bitcoin or Ethereum, are part of the incentive scheme to encourage a disparate group of people who do not know or trust each other organize themselves around the purpose of a specific blockchain. The native token of the Bitcoin network also referred to as Bitcoin, has token governance rulesets based on crypto economic incentive mechanisms that determine under which circumstances Bitcoin transactions are validatedand new blocks are created. These blockchain based cryptographic tokens enable distributed Internet tribes to emerge. As opposed to traditional companies that are structured in a top manner with many layers of management (bureaucratic coordination), blockchain disrupt classic top-down governance structures with decentralized autonomous organizations (DAOs). DAOs bound people together not by a legal entity and formal contracts, but instead by cryptographic tokens (incentives) and fully transparent rules that are written into the software. The Bitcoin Network can be seen as the first true DAO that provides an infrastructure for money without banks and bank managers and has stayed attack resistant as well as fault tolerant since the first block was created in 2009. No central entity controls Bitcoin. In theory, only a worldwide power outage could shut down Bitcoin. With the advent of Ethereum however, tokens have moved up the technology stack and can now be issued on the application layer as dApp tokens or DAO tokens.Smart contracts on the Ethereum Blockchain enable the creation of tokens with complex behaviors attached to them. Today, the token concept is central to most social and economic innovations developed with blockchain technology. Only permissionless ledgers (public Blockchains li Continue reading >>

Utility: The Defining Word For Tokens In 2018

Utility: The Defining Word For Tokens In 2018

Utility: The Defining Word for Tokens in 2018 Dec 23, 2017 at 17:00 UTC|UpdatedDec 24, 2017 at 17:08 UTC Shawn Wilkinson is the co-founder and chief strategy officer at Storj Labs where he oversees strategy, vision and architecture for the Storj network. The following article is an exclusive contribution to CoinDesk's 2017 in Review . It's pretty clear that 2017 was the year of the token. Whether you're reading the news, attending a trade show or just minding your own business working in your preferred coffee shop, you don't have to venture far to hear someone talking about another token sale. There are now more than 1,000 different digital tokens . Keeping all this in perspective, it's no shock to anyone that the crypto community faces ever-increasing scrutiny, with regulation in its various forms stretching from China to the U.S. The biggest common denominator in the argument around cryptocurrency is whether the tokens in question truly do have an underlying utility. The simple fact is that many tokens don't... A recent article from Bloomberg reported that of 226 ICOs and token sales analyzed, only 20 of the corresponding tokens were actually used in the running of their networks, demonstrating utility of some sort - that's less than 10 percent. For many companies, utility appears to be an afterthought, but for a token to be successfully adopted into the community, it is the most critical component. With the amount of tokens on the market today, and new ones being launched every day, it's clear there is a bubble, though the size of it might be debatable. When the market slows, the tokens that have no utility will ultimately not have any value at all. If you need further proof of the importance for utility, check out deadcoins.com , which acts as a digital mausoleum f Continue reading >>

Three Definitions Of Tokenomics

Three Definitions Of Tokenomics

Dr. Paul J. Ennis, James Waugh & William Weaver Mar 17, 2018 at 08:50 UTC|UpdatedMar 18, 2018 at 14:02 UTC Dr. Paul J. Ennis is an ICO advisor and lecturer in the College of Business, University College Dublin.James Waugh is an ICO adviser and director at Blueblock consultancy.William Weaver is a committee member of the Blockchain Association of Irelandand a host on CrytoAM. The crypto economy continues its relentless expansion, encompassing the traditional world of cryptocurrencies and its enterprise offshoot, the blockchain phenomenon. The most recent addition to the scene has been explosive, combining radical decentralist impulses with a Wild West entrepreneurial spirit: the initial coin offering (ICO). What has marked this trend most visibly has been the proliferation of a new asset class, the ERC-20 token , most often representing a share, very loosely defined, in a nascent business, organization or project. Let's imagine a simple example: a startup decides it wants to create a role-playing game (RPG) that exists on the ethereum blockchain . In order to raise funds to create and then develop the game, as well as cover all related expenses (salaries, advertising, etc.), it decides to undertake an ICO. In practice, this translates into the creation of a specific token that can be purchased in a sale, often through other cryptocurrencies, and that capital is then funneled back into the project. This process eliminates the need for venture capital and establishes a direct relationship between startups and an open field of crypto investors. In many cases, there will be more traditional seed funding or private sales involved, but it is the public sale that will generate the most capital. This is "tokenomics" defined in its first and most direct sense, a self-funding mec Continue reading >>

Ico 101: Utility Tokens Vs. Security Tokens

Ico 101: Utility Tokens Vs. Security Tokens

ICO 101: Utility Tokens vs. Security Tokens Initial coin offerings (ICOs) have raised a combined $3.25 billion this year, creating the first visible ripple of what analysts believe could eventually become a multi-trillion dollar industry. Through the ICO fundraising model, startups can raise capital by issuing crypto tokens on a blockchain most commonly Ethereum and distributing them to token buyers in exchange for making a financial contribution to the project. These tokens, which can be transferred across the network and traded on cryptocurrency exchanges, can serve a multitude of different functions, from granting holders access to a service to entitling them to company dividends. Depending on their function, crypto tokens may be classified as utility tokens or security tokens. Utility tokens, also called user tokens or app coins, represent future access to a companys product or service. The defining characteristic of utility tokens is that they are not designed as investments; if properly structured, this feature exempts utility tokens them from federal laws governing securities. By creating utility tokens, a startup can sell digital coupons for the service it is developing, much as electronics retailers accept pre-orders for video games that might not be released for several months. Filecoin, for instance, raised $257 million by selling tokens that will provide users with access to its decentralized cloud storage platform. Because the term ICO is a derivative of initial public offering (ICO), utility token creators usually refer to these crowdsales as token generation events (TGEs) or token distribution events (TGEs) to avoid the appearance that they are engaging in a securities offering. If a crypto token derives its value from an external, tradable asset, it is Continue reading >>

The Blockchain Token Velocity Problem - Coindesk

The Blockchain Token Velocity Problem - Coindesk

Kyle Samani is the co-founder and managing partner of Multicoin Capital , a new thesis-driven crypto fund that invests with a multi-year time horizon in blockchain tokens. Basically, all token pitches include a line that goes something like this: "There is a fixed supply of tokens. As demand for the token increases, so must the price." This logic fails to take into account the velocity problem. In this post, Ill explain the velocity problem by providing an in-depth example. Then Ill examine mechanisms that reduce velocity. Ticket fraud (literally reprinting and selling a ticket multiple times) for events is a huge problem . There's a reasonable case to be made that tickets for live events should be issued on blockchains. If venues come to accept blockchain-issued tickets, this solution should stomp out all fraud. You can't double spend blockchain-based assets. Issuing tickets on blockchains can bring other benefits, including disallowing resale, profit sharing on resale back to the venue, capping resale amounts, etc. Ticketing on-chain should create a lot of value for venues, artists and consumers: it eliminates fraud, reduces scalping, and reduces fees to middlemen like Ticketmaster and StubHub. Although I love this use case for blockchains, there is no reason that I, as a full-time crypto investor (speculator), want to actually hold Aventus , Ticketchain or Blocktix tokens (all three are blockchain-based ticket issuance platforms). Even if these platforms become widely used and process tens of billions of dollars of transactions, their underlying token mechanics are not structured so that the price of the underlying token will materially appreciate. Consider a hypothetical platform that we'll call Karn, in honor of the show that never ends . Consumers want to pay for Continue reading >>

Token Vs Coinwhats The Difference?

Token Vs Coinwhats The Difference?

ChronoBank.io is a blockchain project aimed to disrupt HR/recruitment/finance industry similar way as Uber revolutionised taxi business. The terms crypto coin and token are often used interchangeably. In practice, there are some differences sort of. One of the problems of such a new and cutting-edge sector, particularly one that arises from the grassroots, is that regulation tends to lag behind the technology. The same is true of language. Terms are created and evolve as they are needed, and there is not always clear agreement about what they mean. Two terms used to describe units of blockchain value are COIN and TOKEN. Their meaning and usage overlaps considerably and they are often used interchangeably, but strictly speaking, at least there are some differences. Very broadly, a crypto coin is just that: a coin, or means of payment, whilst a token has wider functionality. The express purpose of a coin is to act like money: as a unit of account, store of value and medium of transfer. Coins tend to take the form of native blockchain tokens like bitcoin (BTC), Litecoin (LTC), Monero (XMR), and so on, though they do not have to. ChronoBanks Labour Hour (LH) tokens, which are hosted on Ethereum, can be considered as coins. Their purpose is solely to act as a form of money, storing value over time and enabling businesses to account and pay for services. They are created as ERC20 tokens for reasons of convenience. Blockchain tokens do have value, but they cannot be considered money in quite the same way that a straightforward coin can. Tokens are generally hosted on another blockchain, like Ethereum or Waves: 2.0 protocols that allow users to create them using the core coin (e.g. ETH or WAVES though theres some debate about whether ETH and WAVES, both of which act like fuel Continue reading >>

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