Such a Diverse Crypto Utility: Overviewing 5 Utility Tokens
Unaware to most, the term cryptocurrency is a blanket word used to describe all types of digital assets. In reality, there are actually several types of cryptocurrencies. The majority of them fall into two distinct categories; coins or tokens. Tokens are a different class of cryptocurrencies entirely. That is why they have two subcategories; utility tokens and security tokens. What does a security or utility token mean & what’s the difference between them? Here’s a list of utility tokens along with everything you need to know about them.
What is a Utility Token?
A utility token is a cryptocurrency token that serves a particular use case(s) within a particular ecosystem. Thus, it allows the user to perform particular actions on or within a certain network. Therefore, a utility token is not mineable. Oftentimes, it’s pre-mined, created all at once and distributed in a manner in which the team behind the project chooses. Therefore, they are not investments in the original sense.
The majority of the time, a utility token funds the development of the crypto project. Later on, it can be used to buy goods or services offered by the issuer. It may also offer a specific utility on the ecosystem it belongs to. For instance, it may offer the holder the access or right to access the network. As an example, AXS tokens grant players access to the Axie Infinity game.
Additionally, utility tokens may be utilized to deliver rewards and loyalty benefits. By holding or staking some kinds of utility tokens, users can earn even more tokens. Moreover, some utility tokens even provide users with voting or governance rights. Depending on the number of tokens held, one can vote on which projects or upgrades the network can pursue next.
Utility Token vs Security Token
Both utility and security tokens can increase in value if their prices appreciate within the market. Therefore, they can both earn users’ and holders’ profit, which makes it a little challenging for people to differentiate them. For this reason, the SEC created the Howey Test to enable people to classify a token as either a security token or a utility token.
With that said, here are some of the major differences between utility tokens and security tokens.
List of Utility Tokens
There are numerous cryptocurrency projects that have made use of utility tokens. Below is a list of popular utility tokens cryptos. They include:
List of Utility Tokens: Binance Token
The Binance token, popularly known as BNB, is Binance’s utility token that was initially meant for discounted trading fees in 2017. Today, however, BNB use cases have grown to other applications such as: buying virtual gifts, donating to charity, making credit card payments, paying travel arrangements, among others.
List of Utility Tokens: Harmony Token
The Harmony Token is Harmony’s native utility token that supports the monetary flow of the entire Harmony ecosystem. The ONE token has several utilities which include: paying for transaction fees, staking to earn rewards & secure the network, and participating in open governance.
List of Utility Tokens: Siacoin
Siacoin or SC, is Sia’s native token used as a payment and reward for both renters and hosts on the platform respectively. Sia, the platform, enables anyone to rent out their unused hard drive space to those looking for file storage. Therefore, Siacoin is used to pay for storage space or as compensation for renting out storage space.
List of Utility Tokens: Hathor Coin
Hathor coin is Hathor’s native utility token. It’s abbreviated as HTR and has an unlimited supply. It also has zero transaction fees and it’s what fuels the Hathor network. The current ranking for HTR on CoinMarketCap is position 344 with a market capitalization of $12,753,568 and a supply of 227,259,896 HTR tokens.
List of Utility Tokens: Lisk Coin
Lisk coin, otherwise known as LSK, is the token powering the Lisk ecosystem. Because it is a utility token, its primary function is to pay fees for different kinds of transactions on the Lisk platform. Additionally, LSK is used to power up dApps and help holders participate in the governance of the Lisk.
Utility Token Exchange: Where and How?
If you are wondering where you can get some utility tokens, we recommend you try Swapzone. It’s the best utility token exchange in the market, with a beginner-friendly interface. Moreover, the whole exchange process is fairly straightforward. Simply head on to Swapzone and follow the following instructions:
- On the homepage, look for the “select pair” tab. In the “send” section, select what kind of crypto you wish to swap for a utility token. Ensure that you specify the amount as well.
- In the “get up to” section, select the utility token that you wish to receive.
- Swapzone will automatically present you with a number of different exchange rate offers from several of its partners. You will notice that there is an option to filter out the results. Take your time and make the right choice.
- Once you find an offer that you want, simply click on it and hit “exchange”. This will trigger a new window to open asking you to fill out a few details such as your email address and a wallet in case of refunds.
- Once you’re done filling in this information, simply hit “proceed to exchange” to start the transaction.
- The Swapzone partner you selected will receive the transaction alert and begin to swap the cryptocurrencies for you. There might be a slight delay. This is normal. Be patient as the transaction finalizes.
- Once finalized, you will receive your utility tokens at your wallet address. At this point, take a moment to rate the exchange partner. That’s it!
Join Coinmonks Telegram Channel and Youtube Channel learn about crypto trading and investing
