Cryptocurrencies started off as something that would keep them away from mainstream finance. However, the blockchain which acts as one of the basic building blocks of cryptocurrency has found mainstream acceptance because of its features like immutability and transparency. One of the greatest and the most tangible bridges between cryptocurrencies and Real-world trading has to be equity tokens. Equity tokens are similar to stocks which entitles the investor to ownership and the parallel rights that come along with holding the equity.
What are Equity Tokens?
Equity tokens are sold through Equity Token Offerings (ETOs) that are quite similar to Initial Public Offerings (IPOs). Startups can use ETOs to raise capital that can be used for their seed development stages. Buy inherent design, equity tokens are quite different from utility tokens because equity tokens represent a form of security to the investors. This involves the investors directly in the growth of the blockchain and these tokens can also function as stocks. Based on the performance of the startup in the market, the price of the tokens can appreciate in their value.
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