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An Essential Guide to Crypto Assets

Crypto assets are digital assets that use public ledgers over the internet to prove their ownership. Cryptoassets use cryptography, distributed ledgers, and peer-to-peer technology to function, create, verify, and secure transactions without the intervention of any middlemen. Crypto assets serve various functions as a store of value or as a  medium of exchange. Crypto assets are traded on crypto exchanges.

Learn more about what crypto exchanges are!

Types of Crypto Assets

An asset functions as a store of value. A Crypto asset is a tokenized asset issued in a public ledger but doesn’t necessarily derive its value from the chain, and its application isn’t just primarily payments. It includes cryptocurrencies, utility tokens, security tokens, and tokenized securities like non-fungible tokens. 

Cryptocurrencies

Cryptocurrencies are the most well-known crypto assets. They are a decentralized native blockchain asset with some characteristics of a fiat currency. Cryptocurrencies are digital currency and a medium of exchange, but they have no inherent value of their own. Their perceived value is largely based on demand and supply in the market.

As cryptocurrency transactions need an exchange platform, it is important to choose the right one. With the looming uncertainty in the market about the security of funds, it is best to settle for exchanges that already have regulations in place and adhere to the law. That’s where LCX comes into the picture and shines brighter than others. 

LCX is registered with the Financial Market Authority of Liechtenstein (FMA) pursuant to the TVTG regulatory framework ( Token and Trusted Technology Service Provider Act). LCX is one of the first cryptocurrency companies to have 9 regulatory approvals in Liechtenstein. Regulated exchanges offer more transparent and secured transactions for your crypto assets. Thus, the consumer’s crypto assets are safe and secure. 

Utility Tokens

Utility tokens are not exactly coins, as they do not run on their own blockchain but instead use the blockchain of the parent platform they are based on. They still use a distributed ledger to provide access and rights to specific products and services. Typically, these tokens are created with a specific service in mind and serve as an API key for that service.

LCX Exchange, as a secure regulated exchange platform, has a utility token that serves as a long-term sustainable incentive mechanism to encourage various stakeholders to participate in the ecosystem. The LCX Token is classified as an exchange-based utility token and may be used to pay all fees associated with the services offered by LCX AG. 

Read more about the LCX token here.

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Security Tokens 

Security tokens are blockchain-generated tokens that are essentially digital, liquid contracts for fractions of any asset that already has value, like a house, a car, a painting, or equity in a company. Investors who use security tokens can expect their ownership stake to be preserved on the blockchain ledger. These tokens are subject to federal regulations because they are considered securities.

Non-Fungible Tokens 

Non-Fungible Tokens exist on a distributed ledger or blockchain, which records the ownership of unique tangible and intangible assets such as a song, a digital image, a video, designer clothing, etc. Non-fungible means these tokens cannot be exchanged for one another; each one is unique. 

To sustain the uniqueness of non-fungible tokens, NFTs might include ownership details for simple identification and transfer among token holders. Owners can even include metadata or attributes referring to the asset in NFTs. 

Since NFTs are unique and the avenues’ full potential is yet to be explored, LCX has taken a step forward within this crypto asset space with its own asset-backed unique NFT Tiamond.  

Tiamond by LCX is Non-Fungible-Tokens (NFTs) that symbolizes the ownership of individual and real-world diamonds. Tiamonds are developed with the ERC-721 token standard. There are plenty of benefits attached to LCX tokenized diamonds. A few of their features are that they can be traded and even redeemed, and a reward of TIA Tokens is attached to them that will be received by the Tiamonds owner over a fixed period of time.

Check out why you should invest in Tiamonds!

Conclusion

Crypto assets are ruling the market today and will do so in the future as well. What we are witnessing is just the initial phase of an era still waiting to unfold. But crypto assets are not without their risks, and the risk comes from trading with half-baked knowledge or on unregulated platforms.

Regulated platforms like LCX are subject to certain requirements to provide a level of protection. These include risk management, disclosure, and dealing honestly, fairly, and in good faith with clients. You can read more about Liechtenstein’s laws to know how LCX as a crypto exchange platform is a class apart. 

Guide to crypto assets
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