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Creating an Utility Token NFT

Let’s summarize how we could be creating an Utility Token NFT as per this course:  The utility token is the third of seven types of cryptoassets.

Utility tokens or app coins are a way for a distributed application to raise funds. One of the first projects to hold the crowd sale for utility tokens was Augur.

The Augur Utility Token example

Augur is a prediction market designed to harness the wisdom of crowds in order to make markets in virtually anything. To us, Augur showed the potential power of blockchain technology. We dubbed the crowd sale at the time,” a blockchain IPO”, but the stickier term was Initial Coin Offering or ICO.

It’s a bit of a misnomer, but the sale was a sign of things to come. In 2016, roughly $165 million was raised in ICOs. That was interesting but not really enough to raise eyebrows outside of the blockchain community. But by 2017, the figure had reached at least $3 billion, perhaps, as much as $7 billion.

Ethereum’s co-founder Joe Lubin, believes this new fundraising model is democratizing the ability for projects to fund themselves.

The Augur native Token

A distributed application like Augur, can sell utility tokens giving consumers access to services or access to scarce resources, or Adapt can sell security tokens which we’ll cover in the next section. Augurs native token is not equity perse, but a utility token that users need in order to interact with the network or the application.

Basically, Lubin says, “Adapt crowd sale is pre-selling something and using those proceeds to build what you need or to take a project from a rudimentary stage to a more sophisticated stage.” Utility tokens can have applications in virtually every industry.

The Utility Token Golem example

 Golem, a decentralised alternative to today’s centralized clouds which are run by giants like Amazon and Apple. Golem aims to use the power of billions of devices to distribute computation, but for its model to work, it needs an incentive for us all to participate. So, in 2017, Golem issued a utility token which allows users to pay and get paid on its platform. Now, if Golem works, it could potentially disrupt Cloud computing as we know it today, a massive multi-billion dollar industry.