Utility tokens can work in the real world
Picture this, Starbucks announces an ICO of 1 billion new “StarCash” tokens. Each StarCash token lets you buy one Grande Americano that costs $3.53. The ICO price is set at $3.00 per StarCash token. Let’s say you missed out on the ICO, how much should you pay for StarCash in the secondary market ?
Probably about $3.50. Maybe you would want to pay slightly more for the convenience of holding StarCash in your digital wallet. You could send some to your family and friends if they needed to buy coffee. Some people would only buy StarCash at a slight discount, say up to $3.40, since their dollars are tied up in a utility token that can only be used to buy a product at a single retailer.
Utility tokens represent future access to a company’s product or service. By creating utility tokens, a company can pre-sell rights to purchase its products or service. For example, Filecoin raised $257 million by selling tokens that will provide users with access to its decentralized cloud storage platform. Currency tokens, on the other hand, are created to serve as electronic stores of value and mediums of exchange. Bitcoin is the best example…