Application tokens vs. infrastructure tokens: “Infrastructure tokens” – often also referred to as “protocol tokens” – are tokens that either steer public blockchain networks (1st layer), their second-layer protocols such as state channels, or other Web3 protocols such as distributed file storage networks.

In some jurisdictions, the term “security token” applies to any token that represents a recognized asset or investment concept. Other jurisdictions have a more narrow definition. The U.S. Securities and Exchange Commission (SEC), for example, defines a token as a security if one invests money with the idea to profit from the efforts of someone

Divisibility and portability

Economics

The history of Web2 has shown that, eventually, all these political, moral or ethical questions will need to be resolved anyhow.

Stability:

I therefore suggest that we explicitly distinguish between “technical engineering,” “legal engineering,” “economic engineering,” and “ethical engineering” when designing a token system.

Technical Engineering When creating a token system, one first needs to decide whether to create a token using an existing blockchain network and other Web3 infrastructure, or if the token can be deployed on an existing blockchain infrastructure.

Fungibility & supply: