Tokens can perform the role of currency within the project, have purchasing power, be a representation of the shareholder’s share in the project, be a form of reward for certain actions, or an indicator of something.
• Token, unlike cryptocurrency, can be issued not only decentralized, but also under management of one organization.
• While a cryptocurrency is designed for payments and transactions, a token has a much larger field of application — it can be used to obtain services or purchase goods, as a representation of the shareholder’s share in a certain project, as the basis of a loyalty program, etc.
• The token does not have its own blockchain, unlike the main cryptocurrencies.
• The scope of using the token is smaller than the cryptocurrency, since the token is originally an element of a closed ecosystem. In this respect, the cryptocurrency can be compared with US dollars, and the token — for example, with subway tokens.
• Factors influencing the price formation of tokens may include such characteristic aspects as linking to an external asset, conditional principles of emission or reward, etc.
