Utility tokens are the cryptographic tokens that give the holder access to a specific blockchain-based product or service. The difference between cryptocurrency and crypto tokens is that cryptocurrencies have their blockchain system, but utility tokens are the smallest unit of a crypto blockchain that shares some space in the ecosystem. For example, RXHEAL is a utility community token present in the Healthcare 3.0 ecosystem and can be exchanged using decentralized applications.
As they don’t have a blockchain system, they are not dependable and can be trusted. Questioning its security, there are some myths and facts about its existence and accessibility.
Utility Community Token: Myths and Facts
Many people are afraid to invest in cryptocurrency due to some myths spread out in the market. Let’s analyze those myths and find the real facts about the token.
Myth 1: Cryptocurrencies Are The Real Money That Can Be Used For Payments
Cryptocurrencies like Bitcoin and Ethereum make payments without using traditional methods like currency notes, debit and credit card payments, and internet banking. They use a separate channel called a blockchain system that is decentralized and doesn’t require any third party for payment. Due to this system, the government bodies of the world are unable to track the system and the tokens present in them. So, cryptocurrencies can’t replace real money for payment methods.
Another reason it can’t replace real money is because it is too expensive and slow for transection. And Elon Musk has denied accepting bitcoin as payment, due to which the value of cryptocurrency decreased.
Myth 2: Cryptocurrency Is A Bubble
Somehow this myth is true as cryptocurrencies like bitcoin are unstable and catch the market very rapidly. Though it gives a high return, when investors realize that they are paying higher than its value, the market will collapse suddenly.
The same thing happened with the internet when there was a time when the internet boomed in this world. And by the end of the ’90s and 2000, the market value started decreasing when people came to know the real use of the internet. The investors pulled out their hands from many companies and they faced tremendous losses.
Myth 3: Blockchain And Cryptocurrency Are The Same Things
Many people think that blockchain and cryptocurrencies are the same things, but it’s not true. Blockchain is an immutable ledger that is designed to keep records of transactions and track assets in the business network. In comparison, cryptocurrencies like bitcoin is a digital currency that carries utility tokens to exchange information without banks. Cryptocurrencies use blockchain technology to store data and in the transaction process.
With the introduction of cryptocurrencies like bitcoin in 2009, the market for digital currency has boomed with high speed and brought so many opportunities for investors. Now, it has evolved so much that we can get several tokens like HEAL token cryptocurrency in the market. The demand for these tokens is getting higher, and every common person wants to invest in them. But, due to confusion, they are afraid to invest and break that myth; we have mentioned some information regarding utility tokens.