Key Takeaways

• KuCoin, Crypto.com, Binance, Coinbase Pro, Rarible, OpenSea and CoinList are some platforms that are used by people to store, buy, sell, and/or exchange crypto tokens.

• Crypto tokens are created using smart contracts on the existing blockchain of cryptocurrencies. They are decentralized and follow the network protocol's predetermined rules.
• Crypto tokens can be stored in a crypto wallet on the cryptocurrency exchanges, hot wallets and cold wallets.

Introduction

• In this research, we have provided an overview of digital/crypto tokens. Information provided include how crypto tokens are stored, bought and exchanged. We have also provided an overview of seven exchange platforms for crypto tokens.

Overview Of Digital/Crypto Tokens

• A crypto token, digital coin, or token is another name for a digital token. It's a unique virtual currency token or the unit of measurement for cryptocurrencies. Tokens are created using smart contracts on the existing blockchain of cryptocurrecies. They are decentralized and follow the network protocol's predetermined rules.
• Digital tokens have a certain utility and are either intrinsic or created by software. Bitcoin and Ether are two examples of intrinsic digital tokens. Asset-backed digital tokens, on the other hand, are issued to reflect a claim on a redeemable asset like legal currency or precious metals.
• While crypto tokens can be used to store and exchange value, they can also be designed to represent physical assets, traditional digital assets, or a specific utility or service. There are crypto tokens that represent physical assets like real estate and art, as well as intangible assets like processing power and data storage space.
• A digital/crypto token uses a decentralized technology to facilitate real-world transactions. Users can make payments and keep their money without having to go through a third-party provider, making their transactions more direct.
• "Some tokens get issued through other applications. For example, some newer mobile apps give crypto tokens to people that actively use their service. These often facilitate transactions between users and make in-app purchases."

Token Creation, Storage And Exchange

Creation

• Tokens can be created by anyone and are released through an initial coin offering (ICO), which is similar to an initial public offering. The token is introduced through crowdsales, and tokens that are publicly available can be purchased even after the initial coin offering has ended.
• Tokens can also be created without an ICO by enlisting the help of a small group of investors. Platforms like CoinTool make it possible for people with little or no coding experience to create their own tokens.
•  Choosing a blockchain platform, defining token properties, developing a smart contract, running tests on a test blockchain like Rinkeby or Ropsten, and finally developing to a blockchain are all steps in the process of creating a token.

Exchange, Storage

• Crypto tokens can be purchased through cryptocurrency exchanges. A cryptocurrency exchange is a large-scale platform that facilitate trades across a wide array of different coins and tokens. The platforms allow users to trade between different cryptocurrencies and regular currencies, manage various wallets, check the value of each crypto, and facilitate the process of sending and receiving currency.
•  Crypto tokens can be stored in a crypto wallet on the cryptocurrency exchanges, hot wallets and cold wallets.
• A hot wallet is an online-accessible virtual currency wallet that allows the owner and end-users to conduct cryptocurrency transactions. Hot wallets can be web-based, mobile or desktop-based wallets. Metamask, Electrum, Coinbase Wallets are examples of hot wallets.
• Cold wallets is a physical device that stores cryptocurrency completely offline; they are the most secure option for storing crypto. They take the form of external devices, like a USB drive or a hard drive. Ledger Nano X, Trezor Model T and CoolWallet Pro are some of the most common cold wallets.

Crypto Token Exchange Platforms

Opensea

•  Founded in 2017, OpenSea is a decentralized marketplace for buying, selling, and trading non-fungible tokens (NFTs). The platform is the first and the world's largest NFT marketplace, with everything from art to virtual reality, sports, and trading cards available.
• Non-Fungible Tokens (NFT) are unique digital asset or crypto tokens.

Services

• OpenSea provides a marketplace for trading NFTs. These include arts, music, trading cards, sports, trade scarce digital goods, buy and sell domain names.

Price

• OpenSea takes 2.5% of the sales price of an item traded on the platform.

Users

• There are over 600,000 users on the platform.

Coinbase Pro

• Coinbase Pro is a digital asset exchange platform that allows merchants, consumers, and traders to transact online. It allows users to create their own cryptocurrency wallets and begin buying and selling cryptocurrency using their bank accounts.
• There are over 250 cryptocurrencies supported by the platform.
• The company was founded in 2012 by Brian Armstrong and Fred Ehrsam.

Services

• Coinbase Pro offers a professional trading platform for users to buy/sell crypto, store crypto on its self-hosted crypto wallet, borrow, earn crypto.
• The platform also provides a direct exchange platform, asset listing, brokerage platform for businesses.

Price

• Coinbase Pro charges between 0% to 0.5% transaction fee per trade.

Users

• Approximately 73 million verified users, 10,000 institutions, and 185,000 ecosystem partners use Coinbase.

Rarible

• Rarible is an open-source NFT marketplace that allows anyone to buy, mint, and sell digital items. The ownership of these items is transferred using Ethereum blockchain technology on the company's online platform.
•  Alexei Falin and Alexander Salnikov, co-founders of the platform, launched it in 2020 

Services

• Rarible connects content creators with potential NFT buyers. Users can create, list, and sell NFTs.
• Digital art, memes, photos, music, games, domains, metaverse, and DeFi are some items available for purchase on the platform.

Price

• For the purchase of NFTs, Rarible charges a 2.5% transaction fee, as well as a 2.5% listing fee for the sale of NFTs.
• Users must pay gas fees to create NFTs on the platform. The gas fees varies depending on the level of congestion on the Ethereum blockchain.

Users

• In 2020, there were 29,000 unique users on the platform.

Binance

• Binance is a cryptocurrency exchange platform that combines finance and digital technology. The company allows users to trade digital currency pairs on the market while maintaining security and liquidity, allowing them to transact safely and efficiently with anyone, at any time and from any location.
• Changpeng Zhao and Yi He founded the company in 2017.

Services

• Users can buy DeFi tokens on the platform from Binance Smart Chain using the BNB token.
• Binance also offers a crypto trading platform, NFT marketplace, derivatives trading, liquidity farming, crypto loans. Binance Chain Wallet and Trust Wallet can be used to store cryptos.

Price

•  0.015% to 0.10% purchase and trading fees, 3.5% or $10 for debit card purchases, or $15 per U.S. wire transfer.

Users

• Binance has 28.6 million users.

Crypto.com

• Crypto.com is a cryptocurrency exchange platform with support for a range of crypto assets and blockchain-related products.
• The company was founded in 2016 by Bobby Bao, Gary Or, Kris Marszalek, and Rafael Melo.

Services

• Users can buy, sell, and trade a wide range of cryptocurrencies on the company's exchange platform. The company also provides cryptocurrency credit cards, a decentralized exchange, a standalone crypto wallet, and an NFT marketplace.
• Users can also earn up to 14.5% interest by staking their crypto or keeping it in a Crypto.com wallet for a set period.

Price

• On trades with a total monthly trading volume of less than $25,000, new Crypto.com users without any CRO staking will be charged 0.4%.
• Without CRO staking, higher-volume traders can qualify for fees as low as 0.04% as a maker or 0.1% as a taker.
• Discounted trading fees are available when a user holds at least 5,000 CRO in their wallet.

Users

• Crypto.com has over 10 million customers. 

CoinList

• CoinList is a platform that connects established crypto projects with new investors. The mission of CoinList is to accelerate the advancement of blockchain technology.
• From token sales to token distribution, trading, lending, and crypto-specific services like staking and access to decentralized-finance opportunities, the platform supports the entire lifecycle of crypto investment.
• CoinList was founded in 2017 by Andy Bromberg, Brian Tubergen, Graham Jenkin, Joshua Slayton, Kendrick Nguyen, Paul Menchov

Services

• CoinList enable users to buy/sell cryptocurrencies with stablecoins or USD, securely store, deposit and send crypto.
• Users can earn yield on proof-of-stake assets and participate in DeFi.

Price

• CoinList charge 0.5% per transaction.
• CoinList Pro transaction fee ranges from 0.02% to 0.45%.

Users

• The platform has over 3.5 million users.

KuCoin

• KuCoin is a global cryptocurrency exchange for numerous digital assets and cryptocurrencies. "KuCoin claims to offer the most advanced level of security and a selection of nearly 400 cryptocurrencies. Despite its variety of features, it is a beginner-friendly exchange, with a sleek and easy-to-use interface."
• KuCoin was founded in 2017 by Kent Li.

Services

• KuCoin's online platform and mobile applications allow users to buy, sell, and safely store a variety of cryptocurrencies.
• Pool-X, a KuCoin-backed company, allows users to stake coins or loan out their crypto and be paid interest.

Price

• KuCoin charges between 0.1 to 0.025% for takers, and between 0.1 to -0.005% for makers.

Users

• KuCoin has over 8 million users.
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Research Strategy