Tokens with value coverage.
Learn elementary information about tokens with value coverage.
Utility tokens were often used to finance the project, and in particular for startup projects (in
the form adopted as ICO — Initial Coin Offering). These tokens have a value within the platform on
which they operate, but they often lack a typically unique value and by definition do not represent
an actual material resource. To put it bluntly, they are far from real assets. The value of utility tokens both during their sale and when trading on cryptocurrency exchanges is driven mainly on the basis of pure speculation, not the powerful foundations behind the tokenomic model.
Asset-backed tokens (tokens with value coverage) in turn have an actual value because they
are directly correlated with the external value of the assets that hedge their value. Tokens that are secured by external assets are comparable to fiat currencies, which had their coverage in other assets, e.g. the US dollar for some time had to cover its value in gold, the so-called gold parity was represented. An example of the use of “asset-backed tokens” in traditional markets is, inter-alia, the issuance of corporate debt. Equity-backed tokens can be designed to include protocols with built-in dividend and profit share functions, converting assets into a passive income-generating investment.
By definition, one form of asset-protected token is stablecoins, which have a direct
correlation with fiat currencies. The issuer of such a stable coin maintains fiat reserves, maintaining a ratio of 1:1 of the indicated fiat currency, which is then matched to the circulating amount of digital stable coin. Stablecoins are not a means to invest in themselves, their main function remains the representation of fiat currencies, not the assets themselves. Stable coins provide an easy and quick opportunity to change portfolios, they are a kind of response to the constant fluctuation in the market value of cryptocurrencies.
Asset-backed tokens are inherently vulnerable to less volatility than other cryptocurrencies. Tokens and coins traded on cryptocurrency exchanges are traded continuously, and decentralized exchanges operate regardless of geographical location and time zones, providing investors from all over the world with the opportunity to trade cryptocurrencies. In the near future, well-established companies are likely to issue their own asset-backed tokens worth billions of dollars, creating one of the most exciting asset classes for decades.
- With collateral — covering its value,
- With the system of repurchase and burning of BSKT tokens.
1. A fee of 2% of the value of each transaction will be taken from the transfer — half is burned out, the other half goes to the staking/reward redistribution pool which indeed speeds up the process of reducing supply. Smart Contract itself assumes that a total of 90% of all BSKT will be burned -> supply will decrease from 21,000,000 to 2,100,000
2. The BSKT token is secured with a basket of seven cryptocurrencies that cover its value. The security so adopted is intended to ensure a constant and stable increase in the value of tokens. Thanks to the correct match of coins in our basket, its value is less susceptible to fluctuations appearing in the cryptocurrency market. The BSKT token security chart looks like this:
- Bitcoin (BTC) — responsible for 25% of the value of the coverage,
- Ethereum (ETH) — responsible for 25% of the coverage value,
- Polkadot (DOT) — responsible for 10% of the coverage value,
- Smartkey (SKEY) — responsible for 10% of the coverage value,
- YfDAI.finance (YF-DAI) — responsible for 10% of the coverage value,
- USD Coin (USDC) — responsible for 10% of the coverage value,
- Basketcoin (BSKT) — responsible for 10% of the coverage value.
3. All listed cryptocurrencies that make up the BSKT basket will be used to generate additional profits on platforms such as:
- Crypto.com (profits of 3%-12% APR),
- YF-DAI (profits up to 72% APR),
- Swissborg (profits up to 20% APR),
- and other decentralized profit-generating platforms in DeFi format.
Revenues from these platforms will be used in the repurchase process for the redemption and burning of BSKT tokens, contributing to a significant reduction in supply on the secondary market. 90% of the above profits will be used for repurchase and burnout, while the remaining 10% will be used for ongoing and necessary expenses related