Security Token, Equity Token, or Utility Token
- Security Tokens. Most tokens issued by Initial Coin Offerings (ICO) are security tokens. This is because the buyer invests their money in the ICO expecting a profit.
- Equity Tokens. It represents some stock or equity in the company that issues it.
- Utility Tokens are also known as application tokens. They are used to give people access to either a product or service. They are rare as most tokens are expected to gain in value.
- Payment Tokens only serves to pay for goods and services.
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People who are new to cryptocurrency often confuse the term "token" and "coin". This guide defines the two terms and provides some examples for a better understanding.
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