How Does a Utility Token Differ from a Cryptocurrency like Bitcoin?
A utility token is designed to grant access to a specific product or service within a decentralized application or ecosystem. Bitcoin, in contrast, is primarily designed to function as a decentralized, peer-to-peer electronic cash system.
While both are built on blockchain technology, Bitcoin is generally considered a store of value and medium of exchange, whereas the utility token's value is tied to the utility of its associated platform.
Glossar
Utility Token
Network Access ⎊ Utility Token represents a digital asset designed primarily to grant holders access to a specific product or service within a decentralized network, rather than representing a claim on future profits or ownership equity.
Decentralized Application
Application ⎊ Decentralized Application or DApp is a software program running on a decentralized peer-to-peer network, often utilizing smart contracts for backend logic and state management, providing services like lending or derivatives trading without central intermediaries.
Store of Value
Asset ⎊ The concept of 'Store of Value' within cryptocurrency, options, and derivatives fundamentally assesses an asset's capacity to maintain purchasing power over time, resisting inflation and preserving nominal value.