Crypto assets are digital assets that operate as a currency or application using cryptographic techniques. Cryptoassets can be broadly divided into four different types including cryptocurrencies, stablecoins, security tokens, and utility tokens. Among these four crypto assets, cryptocurrencies are the most popular and widespread throughout the world.
Cryptocurrencies are considered independent assets that can be transacted using blockchain technology. This is achieved using the consensus mechanism, such as proof-of-work and proof-of-stake. Utility tokens, on the other hand, cannot be considered as coins as they don’t run in their blockchain. Although they use parent blockchain such as Ethereum or EOS to access specific products or services.
Security tokens derive their value from other assets that can be traded both physically or digitally. As the name suggests, they are used for security regulations, like those enforced by the U.S. Securities and Exchange Commission (SEC). Lastly, stablecoins are crypto assets whose price is expected to be that of a fiat currency, like USD.
Subscribe to our newsletter for weekly updates 👇