Why do blockchain projects issue coins (why blockchain appears)

08/06/2023 04:11 • Tech Trends • 67 views

Why the blockchain project issues coins? Editor’s note: This article is from Wind and fire wheels Community (ID: FHBT18), written by Peipei, and reproduced by the Odaily Planet Daily with authorization Hello everyone, I am Pepe Today, we will talk about why blockchain projects issue coins, as well as the token allocation mechanism for blockchain projects. Often, there is a concept of “official seal” in the hands of the project team, but this private key was taken away by someone else who stole it, and these people also seek various applications for their own interests to issue. So let me briefly explain the purpose of issuing a coin, which is to help everyone have a better understanding of the project and learn about some new things, such as DeFi, NFT, DAO, etc. However, we all know that these types of things appear in the form of ICO. So what are the coins issued by blockchain projects? There won’t be much explanation here. 1、 Why do blockchain projects issue coins? The reason why blockchain projects issue coins is because they believe it is a distributed ledger agreement, so they can be used as a new accounting method or a form of digital assets, similar to Bitcoin. However, at present, this type of technology is not yet mature and needs to address the issues of the token economy model. For example, without a token economy model, its vision cannot be achieved. 2、 The reason for issuing coins in blockchain projects is why blockchain projects have such great profits? Mainly due to its liquidity. When users use a certain token, there will be a price change, which forms a liquidity situation, and the value of the token will be transferred out; Another group of investors will also participate in a project to mine and earn profits, while also receiving corresponding rewards. In this way, the currency price will continue to increase after rising, ultimately generating a new source of income – tokens, which is an important component of the entire ecosystem. (Of course, there are also many controversies.)

For ordinary investors, it is crucial to understand whether the deflation model on the chain is high. Some friends may think that if the cost of on chain trading is high, they need to buy another exchange.

. But I think the inflation mode on the chain is terrible. After all, most of the projects in the market are issued by Ethereum, but because of the performance limitations of Ethereum, many projects can only be sold in part, which creates a problem that the current Cryptocurrency has become less and less valuable, and these currencies are not really able to pay gas fees, but run in other networks, So you may ask a question:

Since there are so many tokens on the chain, should we transfer them to the platform or purchase them as one token?

? In fact, the answer is also very obvious, because the vast majority of inflation rates on the market are generated by algorithms, so they are basically divided into several stages: the first stage is the lock-in period in the early stage, the second stage is the contract development progress stage (the third stage), and the last stage is the pledge period.

Why does blockchain appear

The reason why blockchain appears is because it can solve trust problems Reduce transaction costs. From a technical perspective, we all know that Bitcoin was the earliest to be born, but due to its decentralized nature, many applications and projects have not appeared in the market for circulation. For example, Alipay already has this model. Nowadays, with the development of the Internet, people have found that this platform can be used for payment and product traceability operations, making it more convenient for consumers to use their products and services. So why does this phenomenon occur?

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Why do blockchain projects issue coins (why blockchain appears)

Why does blockchain appear

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