Summary
- Crypto tokens are a type of cryptocurrency
- Tokens represent an asset or specific use and reside on their blockchain
- Tokens can be used to make purchases, for investment purposes, or to store value
Tokens in cryptocurrency is a term used to refer to specialized digital currency tokens that represent tradable or fungible utilities or assets residing in a blockchain. Tokens are used mostly for fundraising purposes in crypto, even though they can be substituted for other needs.
The creation, distribution, selling, and circulation of tokens is done through a standard ICO (initial coin offering) process involving crowd-funding for project development. Just like cryptocurrencies, tokens can be held or exchanged at value.
Tokens can also represent utility, service, or a physical asset. For instance, cryptocurrency tokens are used as representations for digital art or real estate.