Finance of Blockchain, Coins, and ICOs

A coin is a unit of a cryptocurrency and a medium of exchange. Coins are distributed among the network according to its own set of rules. For example, in Bitcoin network, a node is rewarded coins when it calculated the hash value that is used to validate the new block of the blockchain. This system is called Proof-of-Work. Bitcoin, Litecoin, Dogecoin, Ethereum, and Ripple are all coins. Each cryptocurrency has their own blockchain.

A token is a unit of value that can describe a cryptocurrency or a digital asset that is built on another platform. Some platforms create their own token using an existing cryptocurrency platform. Many applications use Ethereum Platform to create their own token and rely on the Ethereum Blockchain.

Why trade coins?

Because, similar to physical or digital assets, it has value. They can be bought, sold, or traded. Although the market prices of popular coins like Bitcoin and Ethereum have ups and downs, price is determined by basic supply and demand. 

What is an ICO?

ICO means Initial Coin Offering. At the beginning of a new cryptocurrency project, organizations need to raise money to finance the project. So, limited amount of coins are reserved for initial coin sale that will help to crowdfund the project and allow further development.

Leave a Reply

Your email address will not be published. Required fields are marked *