What are Social Tokens? What are the valuable benefits?
Social tokens are a new group of active tokens in blockchain and cryptocurrencies. These tokens have recently attracted the attention of the general public. Just like NFT tokens, which were very popular at the time of their introduction to the public, this group of tokens has been well received for the services it provides to its users.
In this article, we try to introduce these emerging tokens fully. If you are interested in learning more about Social Tokens, do not miss this article.
What is a token?
A token is a digital asset that can be transferred to others and stored in its value. Tokens were introduced as a type of encrypted license in computer systems before being introduced in digital currencies. Tokens are created by different companies based on Blockchain technology. Each token has its application and can have different values depending on how important it is to humanity and how successful it is in achieving that application.
In cryptocurrencies, tokens are digital currencies that do not have their blockchain and use the so-called platform blockchain to record their transactions. Of course, in the macro view, any asset in the cryptocurrency space may also be called a token. Blockchain platforms such as Ethereum, Bainance, and Cardano can build decentralized applications through smart contracts. People use these features to create and use the tokens they need without designing a blockchain network. To understand the answer to the token question better, it is better to get acquainted with smart contracts.
What is a smart contract?
Blockchain technology was introduced to the world by Satoshi, the creator of Bitcoin. Using the blockchain, it was possible to transfer assets between people in a decentralized network. Although this was a revolutionary event in the financial industry, it did not have enough facilities to engage in other day-to-day issues such as file transfers, decentralized exchange, and the Internet of Things. The development of smart contracts in the Ethereum blockchain network has extended blockchain technology to other areas of life.
The smart contract acts as a definitive program, meaning that certain activities on the network are performed automatically when certain conditions are met. A smart contract is a code distributed in a system that works using “if-then” rules. With these interpretations, the main features of a smart contract are as follows.
- The activity is performed on decentralized systems.
- Conditions and output The conditions are definite and unchangeable.
- Programs run automatically.
- Its code is non-manipulative.
- There is the ability to customize to build various decentralized programs before execution.
- People in the business of using smart contracts do not need to know each other or trust each other.
- All transactions are in transparent contracts and available to everyone.
They are creating smart contracts with the mentioned features that made it possible for companies and individuals to create their applications using smart contracts and use their tokens to manage network activities without creating a blockchain. Since Ethereum was the first to make smart tokens and contracts, most tokens have been created on the Ethereum network.
Nowadays, it is possible to make tokens in other blockchains such as Solana, Avalanche, and Cardano digital currencies. Many new currencies have been created based on these networks. Older digital currencies such as Bitcoin and Bitcoin do not support token creation.
What is the reason and purpose of making a token?
You may also be wondering why companies create tokens instead of building their blockchain. The token can find the answer to this question under the following headings.
- reduction in costs
- Easy to build
- high security
- Scam!
Making tokens in the context of digital currencies is usually inexpensive. Individuals and companies can build their tokens with programming knowledge and smart contracts. This reduces a company’s costs in the beginning. In addition, using the digital currency initialization process, the capital needed to continue the company can be raised, and with these resources, an independent China blockchain can be created.
The second reason for making a token is the ease of making it. To build a china block, you must have all the necessary facilities from zero to one hundred. This requires a strong team in various areas of programming. Unlike blockchain, all you need to do to build a token becomes familiar with platform blockchain smart contracts. You can create your token on blocks of different layouts in minutes.
To ensure their network security, many companies prefer to operate in large, secure digital currencies such as Ethereum. The more users a blockchain network has, the more secure it is. For example, the “ChainLink” digital currency token, although one of the most fundamental and powerful projects in the field of digital currencies, does not have its blockchain and uses the Ethereum network to record its transactions.
What kind of tokens are social tokens?
Social Tokens are a new concept you may not have heard of before. Many economic analysts point to the high potential of these tokens. They believe that these tokens have already attracted the attention of the people. Therefore, what comes to the people’s will can meet their needs, and what meets the needs of the people will be lasting. Now you may be wondering what social tokens are for.
These types of tokens create more ownership for content creators. Social tokens are created using the same methods and algorithms as Bitcoin and Ethereum.
Like other tokens active in the field of cryptocurrencies, these tokens are created on the blockchain network. Most Social Tokens are based on the Ethereum blockchain network.
The difference between social tokens and NFT tokens
It can be said that NFTs are also a kind of social token. The biggest difference between NFT tokens and social tokens is whether or not they can be exchanged.
But NFT tokens are not like this; Because an irreversible or irreplaceable token, for example, that is related to a valuable work of art, can not be easily and in terms of value, compared to another irreplaceable token.
How are social tokens used?
Influencers or people active in cyberspace who have a lot of followers can easily use these services.
For example, a famous influencer can introduce their social and specific token to their followers and offer them a special feature or feature based on the number of tokens their followers buy.
Naturally, the value of social tokens for newcomers who are also promising will increase greatly; So these tokens can be a good investment option.
A valuable feature of social tokens
Social tokens are growing rapidly, and more and more artists and celebrities or powerful influencers are accepting these tokens every day.
Definitely, in the long run, and with the increasing acceptance of these types of tokens among the communities, their value will also increase.
Social tokens have value because they are practical and welcomed by users, and this value increases with the amount of demand.
Thus, social tokens can help content creators set up a dedicated ecosystem between the content creator and his followers.
Benefits of Social Tokens
These tokens have many benefits for businesses. One of the benefits of using these tokens is the increased ability to persuade and attract the user. Naturally, offering a social token instead of a few weak points will attract more users.
Also, since these tokens are based on blockchain networks, there is no possibility of fraud and manipulation in the value and number of these tokens. This also increases users’ trust in this ecosystem.
Another issue with these tokens is their popularity. Although it has not been long since these tokens were introduced to the public, they have gained a good position among investors, traders, and people active in various businesses.
For this reason, a good place for social tokens can be imagined; Because in 2021, similar conditions arose for NFT tokens.
New proverbs were also introduced but were widely welcomed by crypto activists and artists, actors, and even football players.
As you know, blockchain, Web 3, and Metawares technologies, which have a lot of fans and the future seem to belong to them, are all focused on eliminating intermediaries and decentralizing various activities; That’s exactly what social tokens are for!
Concluding remarks
Social tokens are another offspring of blockchain technology that could be widely used in the future.
The data show that cyberspace users are very welcome with this technology, and this issue can be enough for the growth of this ecosystem.
These types of tokens were created to complete the problem of decentralization and eliminate intermediaries, which is also the main purpose of blockchain technology. Of course, users’ needs are not ineffective in creating this phenomenon.
