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04/22/2024

How Do Security Tokens Work

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Larry Garren
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Larry Garren

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What is a token and how does it work?

A token is a unit of account that is not a cryptocurrency, designed to represent a digital balance in some asset, in other words, it serves as a "securities substitute" in the digital world. Tokens represent a ledger entry distributed on the blockchain.

Who is the token for?

It is used in systems of protection against unauthorized access to service information (EDI, RBS, EE and others), personal information of users, passwords, encryption keys, digital certificates and any other confidential information.

How do you distinguish a token from a coin?

Coins are any cryptocurrencies that are powered by a separate blockchain. Altcoins are all coins other than Bitcoin. Tokens are cryptocurrencies that do not have their own blockchain and operate based on the network of another coin.

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