Tokenization – the new way of marketing in the blockchain industry

Tokenization – the new way of marketing in the blockchain industry

by Grzegorz March 25, 2019

In recent times, it is said that tokenization is about to contribute to the development of the blockchain industry. The global economy leaders estimate that this industry will reach the value of 24 trillion dollars by 2027!

Imagine a revolution in the world economy, which is going to affect small and large businesses on a global scale. Imagine dynamic changes of prices in your favorite restaurant dependant on the time of day. Tokenization of specialists is a fantastic way to market the valuation of their work.

But what exactly the tokenization is? In order to understand what it, we need to explain simple terms related to cryptocurrencies. What are altcoins and tokens? Check out the definitions below:

What are altcoins?

In simple words, we call altcoins the all cryptocurrencies except for Bitcoin. Tokens and altcoins are mistakenly used as synonyms as their structure is different. Altcoins possess their own separate blockchain. The most well-known altcoin today is Ethereum.

What is a token?

Together with altcoins, tokens are two subsets of cryptocurrencies. In simple words, a token is a cryptocurrency which depends on another cryptocurrency as a platform to operate.

Unlike altcoins, tokens operate on a top of the blockchain. They were designed to facilitate the implementation of decentralized applications. Cryptocurrency tokens are much easier to create than altcoins and therefore, about 80% of circulating coins today are tokens.

To mention an example, Ethereum supports the development of additional cryptocurrency tokens, and crypto platforms such as TRON and EOS began as Ethereum-based tokens.

The token is, in fact, a new term referring to a value unit issued by a private entity. Although tokens have many similarities to Bitcoins, they are something more than just digital currency, because they can be used in a wider range of applications. Also, virtually all tokens are based on the Blockchain Ethereum protocol, which according to experts is more complete than Bitcoin’s one.

In other words, a token is a unit of value that an organization creates to manage its business model independently to enable users to interact with its products and to facilitate the distribution and sharing of prizes and benefits with all interested parties.

As part of a private network, a token can be used to grant ownership, pay for work or to transmit data, as a stimulus, a gate to additional services or better user experience, and therefore a token can be used in any case when a person or organization decides this.

Tokens are a new investment tool based on blockchain technology and are just as risky as attractive. It is a market that needs to learn how to use it in a wise and thoughtful way.

After understanding these basic terms, we encourage you to read the definition of tokenization:

What is tokenization?

Tokenization is a form of business digitization based on decentralized blockchain technology. It involves creating tokens or cryptocurrencies and strictly assigning them to a specific project, company or person (personal tokens). With the development and adaptation of blockchain technology, the potential of tokenization has become enormous thanks to Smart Contracts and allows tokenization of all types of assets while reducing the cost of their transfer.

Simply and without technical details, tokenization involves transferring the value of a brand, company or asset to the digital world using blockchain technology.

Great marketing tool

The fact is that every company or person represents something. Are you working on your own personal brand or are you the owner of the company? By means of tokenization, you are able to transfer your assets to the digital world and make them available to recipients, clients or fans on social media.

The personal token is a great marketing tool. The information that a given entity or person has generated its own token or cryptocurrency arouses a lot of media attention. It is a distinction among competitors at the very start.Tokenization offers a whole range of possibilities. You can give your tokens to customers or fans as a reward in contests or loyalty programs.

Above all, trust!

A very important element of marketing a company that has its own token is trust. The company must run a campaign and provide an almost perfect product. In the event of erroneous decisions of the company, which will cause a drop in trust, it may turn out that the value of the token will go strongly down. For this reason, it is likely that holders will start selling tokens.

It will also work the other way round. The more trust you will experience, the more people will want to become the owners of your token. And that will increase its value. It is synonymous with the fact that the more the price will grow, the more you will get, and attract even more people willing to buy them. And this will have a more positive effect on your brand.

Tokens can be used to build loyalty programs, but also as a right to vote on specific company matters. In contrast, you can give an example of large platforms on which the community is involved, but which is operated by a small group of several managers.

Imagine what Twitter or Facebook would look like today if its owners were not huge, profit-oriented investment funds, but users themselves. Do you think that we would see as much advertising and scandals related to data privacy? We doubt it. If you would like to invest in such a company under the aforementioned conditions, do you think someone would want your money and voice there?

“Let’s take a restaurant. Always some tables are empty, and the prices of dishes are always the same. If this restaurant released its token, such a ticket, its price would be dynamic during the day. In the morning and in the evenings, with the most demand, the token would cost more. In the middle of the day, when there are not many customers, the market would price token lower, guaranteeing the restaurant additional customers. The dynamics of technology and blockchain give a new perspective on building values and understanding, of which this value really results.” said Michał Grzybkowski, a crypto writer, in the interview with InnPoland.pl.

Efficient tokenization

One of the problems faced by the company is finding a service provider who will conduct efficient tokenization. There are not many companies on the market that have any experience in this and that already have some success in this field. It is very important for such a company to have knowledge of the subject of the industry and, best of all, many years of experience, not only in tokenization but also in carrying out marketing campaigns and other services around tokenization. Our team has many years of experience in the above-mentioned issues, cooperating, among others, with a large and very innovative cryptocurrency exchange.

The new way of marketing

Blockchain technology brings the revolution thanks to anonymity, security, transparency, and speed. It is the future of our everyday lives. Tokenization will definitely start to become more and more popular. Currently, huge companies such as IBM, Facebook, PayPal, Mercedes-Benz start to implement in their projects solutions based on blockchain technology. Tokenization is a great marketing tool, it is a new way of marketing. And we, as Try Codnet, aim at bringing blockchain solutions to life!

Do you want to have a project which helps you achieve success in business?

Together we’ll bring your ideas to life!

Tokenization – the new way of marketing in the blockchain industry

by Grzegorz time to read: 5 min