Tokenizing Startups, from Utility Tokens into Security Tokens

Blockchain is a revolutionary and commonly used technology nowadays. Blockchains are used in many fields, especially financial ones. Tokens are one application of blockchains that represents assets or access rights. Smart contracts and an underlying distributed ledger are used to manage tokens. In this paper, the differences between and the usages of utility and security tokens are discussed in depth. The problems of utility tokens and the ICO boom are mentioned as well. We also discuss how security tokens outweigh the benefit of utility tokens where companies and startups can use them as a standardized solution without suffering from utility tokens’ problems.