What is a Fan Token?

What is a Fan Token?

Featured Knowledgebase
11/12/2020 by Koinal
286
Digital currencies have a wide range of uses. Fan tokens are a new and growing use. Today, you can buy digital currency and use it to purchase a token for a favorite sports team. As a team-token holder, you can engage with your favorite team in unique ways.
What is a Fan Token

Koinal offers a fast and convenient method for purchasing digital currencies. At Koinal, you can buy using your bank-issued credit or debit cards. Let’s review digital tokens and look at the new sports token concept.

Coins versus Tokens

The terms coin and token are often used to describe cryptocurrency. In some ways, they are not the same. A coin such as Bitcoin is a digital asset intended for use on its blockchain. Bitcoin trades on the Bitcoin blockchain. Coins can serve many purposes, but they tend to stay in the financial area. Ether is the Ethereum blockchain coin, and the Ethereum organization uses it to pay for platform services such as mining or validation.

Tokens can work on existing blockchains; they function as proof of ownership or membership. Tokens can have a specific role or purpose, such as to support a project. For example, Ethereum issues the ERC token. Most tokens are either security or utility types.

  • Security tokens represent rights to earnings or dividends. Buyers of these tokens are intended to make profits.
  • Utility Tokens provide access to the outputs of an existing project or planned project. These often offer discounts to future goods or services. Utility tokens often fund companies and projects.

A New Category – the Fan Token

Sports ventures have entered the digital space. Some team owners offer fans a new way to engage with their favorite teams. These sports organizations issue team tokens for their fan base. These tokens are membership tokens in that they empower the holder to participate in fan-led decisions and events. Fans that hold tokens can vote on some issues and win rewards.

The basic structure is to establish the team tokens on a particular purpose blockchain and platform. With limited distribution, the tokens can respond to supply and demand. For example, the team tokens can rise in value as the team increases in popularity. The fan token offers a new and exciting way to enjoy owning digital assets and trading them for value.

Koinal.io offers you an opportunity to open an account and begin purchasing digital assets. You can buy for financial investment, increase financial flexibility, or support a favorite sports team. Open an account and start trading today!

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