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What is Equity Token? - A Simple Guide For Beginners

Mar 11 , 2021 | 343
What is Equity Token? - A Simple Guide For Beginners

In the crypto world, equity got a special place and peoples are eager to know and create it, mainly the business peeps. That is because, the equity has the characteristic to withheld and represent the share of a company or an asset.
 

And how is that, what all equity token does, those things are clearly explained in this blog by the best Ethereum token generator, TheTokenLauncher.

Table of the Content:

* What is an Equity Token?
* Benefits of Equity Token
* Types of Equity Token
* Functionality of Equity Token
* Where to Create Equity Token in minutes?
* Why Prefer TheTokenLauncher for Equity Token Generation?

What is an Equity Token?

Equity Token is a type of token which is widely used to claim to ownership or to showcase their authority over an asset. It is just like other financial instrument and similar to the traditional way but equity tokens have documents in virtual forms like digital certificates, proof of transaction whereas the traditional way has physical book certificate.

Either form contains the same contractual information and since the equity token is decentralized its data are encrypted and stored in blocks, where the holders have rights to take action with it.

Moreover, the equity token has its uniqueness when compared to other sets of tokens. This equity token withheld the quality of holding the ownership of the property, share or any form of asset. Its ultimate aim is to raise capital and this beneficial Equity token can be represented in any forms like,

  1. Stocks
  2. Future
  3. Options Contract
  4. Tokenized Real Estate
  5. Tokenized Companies

The equity token don't alone uphold the share or authority over the asset, it also gives the voting power over it. The only difference between the equity token and the traditional way is, the usage of methodology virtual and physical as said earlier.

Types of Equity Token

Equity tokens are of two types, they are,

  1. Dilutable Token
  2. Non-Dilutable Token

Dilutable Token

Anyone can create a lot of stock and provide authority over it then release it to investors or shareholders. Only when the unissued stacks can be sold is, when the existing issued stacks are diluated the shares. The amount of the tokens represents the share of the organization and it will be engraved on smart contract. When the company growth is increased then the stack held by the investors will be reduced, anyways the value of the stacks will be improvised alongside the respective company growth.

Non-Dilutable Token

In the non-dilutable concept, every token is equal to a share of the company. The investors upholds the share until it remains it in his/her wallet. And, they provide various premium offers as an anti-dilution measure, thus ensuring the investors get retained as the institutional shareholders without disposing/ diluting their assets. This is to graduate the stakeholders to grab the future opportunity at present.

And, Dilutable Tokens are more preferred than the Non-Dilutable tokens and also recommended one.

Benefits of Equity Token

As said before the equity token is an aid to get authority over the asset or share via blockchain. That is the difference between the tradition and equity token is the usage of blockchain. Here is the list of benefits can be attained by the usage of equity token,

  1. Authority
  2. Voting power
  3. Asset safety
  4. Profit share rights
  5. Buyback rights
  6. Automated dividends
  7. Cash flow
  8. And much more

Functionality of Equity Token

The function of the equity token is very simple, it can hold authority over the share or property in the percentage base and also can gain the authority to vote to select the solu authority person or for any other purpose.

Example:

When a person holds a 10% authority over a share and gain 1 vote alongside. It means that the out of 100 the person holds 10% and also 1 vote to decide or make any decision in the discussion over the share benefit.

"Hope You Gained Some Knowledge about Equity Token. If you wish to create one or to know where to Create Equity Token. Then read further..."

Where to Create Equity Token in Efficient Way?

As you have already known well about the equity token, now create your own equity token for your personal or professional use from the best Ethereum token builder in the global market. And TheTokenLauncher is the best result for that, because it is one of the supreme ERC20 token builder for any sort of Ethereum based token creation from wherever in the world.

Why Prefer TheTokenLauncher for Equity Token Creation?

TheTokenLauncher is the leading ethereum token creator which is the best choice for creating utility token because of the following advantages,

  1. Create Utility token on time
  2. Create token by yourself
  3. Can build token instantly
  4. No need to have coding knowledge
  5. In-built codings
  6. 24/7 support
  7. Time Effective
  8. Smart Contract
  9. Wallet

And also any Ethereum based tokens can be created like security token, mintable token, asset-backed cryptocurrency, utility token, fan toke, fund toke, ICO, etc.

                                                                                            Create Your Own Equity Token Instantly!