The vast majority define crypto assets wrongly!
It's 2022 and people still believe that cryptocurrency is the right way to categorize products or value points of blockchain technology, this is understood but not a fine approach to the ecosystem.
Cryptocurrencies are only but a fraction of the distributed ledger technology, if anything, without the idea of "financial stability" there wouldn't even be a cryptocurrency nor the market or participants assigning fiat-based values to it. It's important to note that crypto-currencies differ from other crypto-assets.
Bitcoin isn't a currency, a currency shouldn't lose over 10% in a day, which would cause market crises and put several businesses at risk of losses.
It gets so disturbing that even the IRS feels all there is to a blockchain is cryptocurrencies, why else would NFTs be drafted for taxation and categorized the same as stablecoins and cryptocurrencies?
Why would you call stablecoins and cryptocurrencies apart? They are both the same thing, I know it will take us all a while to admit the wrong usage of these terms, introduction to cryptocurrency articles needs to be rewritten! They should be written as "introduction to crypto assets" not currencies, I may have to start writing guest articles for these media outlets.
We should begin building broader categories to name these assets because frankly, we have cryptocurrencies - the stablecoins, we have governance tokens, we have utility tokens, we have memecoins sometimes called shitcoin, all together they are "crypto assets" even though some do not deserve the name "asset". Sometimes a crypto asset can be both when it appears as a governance token and a utility token.
A utility token can regenerate income, it's volatile, but it's not a representation of "governance rights". We have many of them in DeFi applications, most crypto assets are also utility tokens as though when presented as a "product" in another network they become just that without being a governance token.
Example: Hive on cubfinance is a utility token because you can regenerate income simply by providing liquidity. Now, on cub ecosystem and Binance smart chain as a network, Hive has zero governance influence, but on its native blockchain, it does.
We also have loyalty tokens, a kind of replacement to point systems that have been a major way of incentivizing customers, we may see more of this as businesses begin to integrate with blockchain.
Many people in space do not even understand this and the government too can't see the difference because everything looks the same from afar.
What more is there to blockchain-based assets?
It's essential we understand what other asset types are on the blockchain and by this I mean NFTs!
An NFT is a digital asset that can come in the form of art, music, in-game items, videos, and more. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.
We've all seen diverse definition when it comes to NFTs, having gone through numerous sources they all have similar use of terms which specifically is: "digital assets" "collectibles" "arts" and while it is true that NFTs enables us to tokenize these unique items, we can't call them currencies but non-fungible crypto assets because they are protected by cryptography and are unique pieces.
Non-fungible helps us distinguish between what can be interchanged and what can't. Since NFTs represent unique data sets that play a huge role in tokenizing real-world assets, they are set aside from other crypto assets.
However, NFTs can still be Utility tokens and even governance tokens, only that each piece is different from the other based on the encoded data set during mint.
This makes blockchain a powerful building ecosystem, carefully designed to meet several businesses, social, financial, and economic needs. It isn't something the government will understand in full in a flash, it's been 13 years and they still don't understand Bitcoin, what makes anyone think they will understand what has been developed over those years?
Thank you and please leave a comment, your thoughts matter to me.
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