Annotote TLDR
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Annotote TLDR

TLDR: The complete guide to digital tokens on a blockchain

by bitsonblocks (these highlights were provided for you by Annotote)

digital tokens being used to represent different assets on a blockchain.

“ [tokens] exist conceptually as entries on a ledger (a blockchain). You own these ‘tokens’ because you have a key that lets you create a new entry on the ledger, re-assigning the ownership to someone else. You don’t store tokens on your computer, you store the keys that let you reassign the quantity.

‘ There are two types of tokens…

  1. Intrinsic/native/built-in (e.g. Bitcoin): usually part of an incentive scheme to either encourage people to help validate transactions & create blocks (i.e. a reward for BTC mining) or disincentivize spam (i.e. not zero marginal cost);
  2. Asset-backed: claims on an underlying asset from a specific issuer

“ The transactions as tokens get passed between people are recorded on the blockchains, and to claim the underlying asset, you send your token to the issuer, and the issuer sends you the underlying asset.

#redeem #redemption #liquidity #liquidate

“ Sometimes the purpose [of an asset-backed token] is to be able to transfer assets (or rather IOUs) quickly and easily while keeping the physical item secure in a warehouse. Other times it’s to have a digital token whose digital ownership matches the physical journey object [e.g. like a digital title to a physical house].

#dematerialization

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Anthony Bardaro

Anthony Bardaro

“Perfection is achieved not when there is nothing more to add, but when there is nothing left to take away...” 👉 http://annotote.launchrock.com