Utility tokens vs. equity tokens: Key differences explained

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Utility tokens vs. equity tokens: Key differences explained
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Although crypto coins and tokens fall under the broader umbrella of cryptocurrencies, subtle technical differences between the two make each unique and warrant that investors understand these variances. Check out our extensive explainer article:

the Brave browser’s global private ad platform, which has 54 million monthly active users and 1.4 million verified creators, benefitting from arguably one of the most successful blockchain projects to date. Both are classic examples of utility tokens that have grown multiple folds in price terms since their ICOs due to the immense value they have created since their launch.

Representing a unique method for companies to raise capital on the cryptocurrency market, security tokens allow companies to sell stock in a digital form or as a tokenized equity and provide ownership opportunities for a large swathe of investors at a low entry point. Unlike utility tokens, however, security tokens are regulated by bodies such as the U.S. Securities and Exchange Commission since they represent real ownership of underlying assets. process and can represent a very small monetary value of the company or firm, making it possible for a more geographically dispersed population to own the underlying entity as compared to traditional equity market offerings.

Equity tokens issued through the equity token offering process also offer their holders the benefit of voting transparently on the issuing company’s matters through the blockchain, thereby facilitating the investor community’s acquisition of control in proportion to their holdings.

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