What are tokens?

What are tokens?

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A token is a digital asset that is sold to the public during an ICO campaign, usually for other popular cryptocurrencies, namely BTC or ETH, or sometimes directly for fiat currency. Unlike a cryptocurrency, tokens usually do not have their own blockchain, but rather are hosted on another blockchain, such as Ethereum’s.

Once an ICO campaign is complete, the token developers can release the tokens on an exchange, where they can be traded and fluctuate in value, like any other cryptocurrency.

Tokens can also have other functions that are particular to the product that issued them. However, tokens themselves do not necessarily give rights or equity to the product/company that originally issued them — in that sense tokens are definitively not equal to shares in a traditionally structured company.

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