Evolution of Tokenization
Our thoughts are aware of the concept of a token. It is a quotation of the modern financial landscape.
Any token represents a value that is tied with a particular ecosystem. If you want to choose a certain project. And there is no difference between traditional currencies and tokens. It has been possible to ensure that there is a risk of backing.
Tokenization in Web Services, Gaming, and Online Projects
Years ago no one has heard of bitcoin. But in those days tokens already flourished within a number of projects and concepts. Many digital services. You couldn’t have to pay for new options.
Chances are played online games. In this case, you can earn earned through completing missions, finding artifacts, etc. These are your skills for your game character. For fiat money.
Today it still works the same way. Thousands of games, online projects, and apps have their own tokens. There is no value outside of the ecosystem. Since these tokens are a utility, they are called utility tokens.
Tokens in Fundraising: the ICO Era
Fundraising has always been a challenge, in particular, for small scale projects. There are a Minimum Viable Product, at the very least. But even the simplest prototype.
This is where the Initial Coin Offering concept is stepped in. The project founders issued a certificate of value to a non-existent product. You need it. If you are a client, you must be able to pay for it.
It was taken by the tokens to be the owner. They were on the crypto exchange rate.
However, these two benefits have been a risky path, since such tokens have been short of the definition of a utility token. Tokens with implied profit are howey test. If you are a seller of safety, it’s not a problem. That's why financial regulators like ICOs. They were claimed responsible for selling unauthorized securities. Pay all the money to investors.
This got even worse since over half of all the ICO projects failed to deliver the products they promised to. Consequently, they also didn’t fulfill the investors’ expectations. This caused a decline in the community’s confidence and the defamation of the very concept of an ICO.
Security Tokens: the Rise of STO
To avoid the risk of claims from regulators, some companies started to choose a more cumbersome but a reliable and safe path of conducting a Security Token Offering. This fundraising strategy implied performing a legally compliant procedure of selling securities in a form of tokens.
Everywhere it’s been a matter of This has a revolutionized idea of a token! It’s a question of whether you want it or not.
If you’re still a person, you’ll be able to get it. It can be obtained from the legal tools.
This incentivizes the investment tokens. This is how to get a solid financial tool.
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