Cryptocurrency is a digital representation of value that can be digitally traded and function in the same roles as fiat money.
- A medium of exchange
- A unit of account
- A store of value or storing value over time
Cryptocurrencies do not have legal status ( i.e. when tendered to creditor, is a valid and legal offer of payment in any jurisdiction.
Cryptocurrency is distinquished from fiat currency ( a.k.a. ‘‘real money’’ or ‘‘national currency’’) which is the coin and paper money of a country that is designed as its legal tender.
Cryptocurrencies are created and issued by private developes and therefore is a privacy currency. Cryptocurrencies operate on a decentralize system of nodes and a ledger called the blockchain with no administrator or single point of failure.
THERE ARE THOUSANDS OF DIGITAL TOKENS AND COINS ON THE MARKET TODAY.
Some are designated to complete a specific outcome while others are meant to be a unit of account.They all function using blockchain technology while others use an existing blockchain.
The market consists mainly of four token types:
Payment tokens: Payment tokens refer to cryptocurrencies that have been created to facilitate transactions. Bitcoin (BTC), Bantu (XBN), Ripple (XRP), Bitcoin cash( BCH), etc. are all example of different payment tokens. Some are designed to be a cross boarder payment and solutions aimed at interbank transfers, while some are privacy focused coin, providing anonymity to users. There are many other coins in this sector, with many more being created as time goes on.
Platform tokens: Platform tokens or smart contract tokens: Platform tokens are used on programmable or general purpose, blockchain application upon which DApps are to be deployed. E.g. Bantu (XBN)
Decentralized Application (DApp) tokens: DApp tokens are native to a specific distributed application, and commonly represent access right to resources or services provided by the DApp Bantu (BNR).
Stable Value tokens: Are special kind of token created with the aim of minimizing the inherent volatility found in cryotocurrencies.
The price of stable coin can be pegged to a fiat currency such as the US dollar, or to commodities. Example of stable coins include Tether, USDCoin, TrueUSD, etc.
Stable coins: A stable coin is a cryptocurrency that is pegged to another stable assest, like gold, or thr US dollar. It’s a currency that is global, but is not tied to a central bank and has low volatility. This allows for practical usage of using cryptocurrency like paying for things every single day.