Beyond Bitcoin: The Significance of Tokens

2017-11-29 | Simpler Trading Team

With Bitcoin trampling the 11k mark without hesitation, altcoins like Ethereum and Litecoin have benefited from the BTC fervor and shot up as well.

But while everyone focuses on coins, there’s another piece of the blockchain that presents a ton of opportunity.

A piece that no one is talking about…

Tokens.

To be clear, Bitcoin is the future. However, the sheer momentum it’s experiencing is unsustainable at this current rate.

So while everyone hops on the BTC bandwagon, smart traders can get ahead of the game with some appealing token offers.

What is a token?

Tokens and coins are often used interchangeably because both are based on blockchain technology. However, the two are very different.

Coins, such as Bitcoin, are used strictly in a monetary capacity. When Bitcoin is referred to as a digital currency, it’s literally only capable of exactly that.

Tokens, on the other hand, are also built on blockchain. Each token has its own blockchain, though. They’re designed to do so much more than act as a digital currency.

For example, the most well known token on the market is Ethereum.

Ethereum, like Bitcoin, runs on its own blockchain platform, with “Ether” being the actual currency people can trade. Where Ethereum differs from Bitcoin is that Ethereum can do so much more than just act as a currency. Ethereum tokens are highly programmable, and the Ethereum blockchain can run the programming code of any decentralized application.

Basically, while a coin can only do one thing, a token can serve multiple tasks.

Ethereum isn’t the only token available, though. Here are a few other options you can explore.

NEO

NEO, currently trading around $32, is a non-profit blockchain project founded in 2014 focused on a “smart economy”. The project was created to digitize assets using smart contracts protected by blockchain technology.

METAL

METAL (MTL), is technically a token, but is specifically programmed to be a digital currency. Their mission is to reshape the concept of digital money. There are only 66.5 million MTL available. The project puts its focus on gamification and a reward system. You can pay anyone anywhere instantly with Metal and earn rewards for doing so. MTL’s current coin value is just above $4. The company’s team, made up of heavy hitters across tech and finance (including executives from American Express, Apple, and BitTorrent) promises 24/7 expert support and integration with any bank account.

CARDANO

CARDANO (ADA) is a fully open source, decentralized public blockchain and cryptocurrency project. Cardano currently trades at under $0.10. The project is focused on smart contracts, with a core team made up of engineers and researchers. Cardano only works with its DAEDALUS wallet, which the project promises will be able to run decentralized applications on the blockchain. This offers some unique features, such as allowing wallets to be exported to paper certificates, giving a max security option of placing funds in cold storage.

CIVIC

Civic (CVC) trades at around $0.28. This token specializes in identity protection. Civic offers a decentralized architecture utilizing blockchain technology combined with mobile device biometrics to provide multi-factor authentication without needing a username, password, or third party authenticator. Civic’s technology could be extremely useful across numerous industries, including financial, e-commerce, legal documentation and signatures, medical info, and social network security.

POWER LEDGER

Power Ledger (POWR) sits at $0.53 per coin. Power Ledger is a blockchain-based peer-to-peer energy trading platform enabling consumers and businesses to sell their surplus solar power to their neighbours without a middleman. The Power Ledger system tracks the generation and consumption of all trading participants and settles energy trades on pre-determined terms and conditions in near real time.

FACTOM

FACTOM (FCT) is currently valued at $19.14. Factom technology secures data for private and public organizations by publishing encrypted data or a cryptographically unique fingerprint of the data to Factom’s immutable, distributed Blockchain. Its goal is to make it possible for all users to enter data into the blockchain without the heavy costs of high volume transactions. It makes data verifiable and independently auditable.

Currently, there are 1,328 cryptocurrencies available for purchase. These are only a handful of the options traders can take advantage of. In the end, each trader can decide which cryptos to utilize by price, technical analysis, or aligning with the crypto’s purpose. But to do that, a trader needs to understand that purpose. The more you know about a token, the more you can gauge its future success. A token launched by a powerful team, with a purpose that can be adopted across numerous industries, has a better chance of success than a coin created for the sake of its own creation. When identifying trading prospects, do the research and look at more than just price to maximize your profit potential.