One of the most well-known cryptocurrency lending platform: Ethereum has found its way into almost everything that it takes to be perfect. Talk about the three main possibilities of dealing with the international transfers using cryptocurrency: Lend, Send and Spend. The three of which have been simplified in the most impressive way possible. To make the dealing a lot easier on its own, their idea of a multicrypto debit card in something that is sure to turn heads.
With all of this, Ethereum hasn’t quite been short on anything. An added possibility includes the freedom for everyone to create a token of their own. There is absolutely no barrier of entry now. And that is why a number of new tokens have been seen flooding the Ethereum market since this happened.
If we talk about the present time, more than 5300 ERC-20 tokens are said to be existent on the network. With this, the numbers are still counting by each passing month. But this could be a different concern as not off them hold a store value.
It must be clearly understood that the Ethereum tokens encompass a number of applications. They cannot just be seen as a share in a startup. The Ethereum system will be gaining more strength and support with the coming time, it is a possibility that we may be able to see many more types of token been introduced in the Ethereum blockchain.
Governance
The DAOs or the Decentralized Autonomous Organizations can be termed as the companies which function with a certain set of hard-coded rules. These rules are meant to be frequently updated by a decentralized form of leadership.
But a fact to be considered here is that these kinds of leadership businesses are bound to have hundreds of individuals involved. Using simple and formal routes of communication might prove to be very challenging. This is a situation where Ethereum tokens can be put to good use.
For example, recent startups such as the District0x did implement a token-based governance system. The DNT token holders are allowed to vote for the projects they think should be built on the platform next and thus they can participate in the key decisions.
Tokenized security
As a model for startups, tokenized securities can be seen as an extremely efficient way to go. Although, it was ruled by the SEC ruled that tokens can be securities and therefore need to undergo adequate regulations.
The investors need to be benefited financially from these startups and the token utility sure makes it possible. It could possibly take the form of dividends, or a token buy-back program. As an example, consider the gambling site Etheroll that recently paid out the first dividend round to its investors.
In-Dapp currency
For the in-dapp interaction between the users, a number of Dapps have chosen to use their own token. This choice of the users has been successful in enhancing efficiency and loyalty to the platform.
For the Golem network, GNT is necessary for the interaction with the platform. The token gets its use in transferring value between computing power requesters and providers.
Staking mechanism
As is the case for some business models, a fundamental part is the rigorous quality assurance mechanism. Consider the Numerai. Numerai is known to work together with data scientists in order to create a machine learning-based hedge fund.
Users are allowed to submit algorithms which can make autonomous trades on the stock market. With this, the Numerai rewards them in NMR tokens. Also, users are required to stake a certain amount of NMR tokens on their algorithm before they submit it. This is done to ensure that submissions of inferior qualities are avoided.
The creator of the algorithm gets his stake back if the algorithm delivers the desired results. The tokens are burnet, if not. Because of this, the data scientists tend to submit their very best work only.
Tokenized assets
Another application is tokenizing assets which are either very illiquid or which can be difficult to physically exchange. These could include examples like the real estate or gold which can be quite an interesting concept for the investors.