For a considerable amount of time in recent history, initial coin offerings, or ICOs as they are commonly abbreviated, have been the de facto standard for defining the confluence of a new technology like blockchain and the traditional world of investments. However, the inherent flaw with the ICOs was that they offered utility tokens.
What Are Utility Tokens?
Utility tokens, as the name defines, represent a certain utility that holds value only within the product or the project ecosystem. Although utility tokens were marred by scams, they have to be given the credit of unifying blockchain and investments.
Utility tokens and their success is purely built on speculation albeit a calculated one. The value of the utility tokens during the token sale or when traded on third-party exchanges is purely contingent upon this element of speculation rather than the tokenomics model. Read more - https://hackernoon.com/asset-backed-tokenization-everything-you-wanted-to-know-9m4m32n0
