What is Token

An overview of cryptocurrency tokens and how to check their validity. The list of tokens supported by the Zenland platform and their networks is given below.

Quick Facts

A token is commonly referred to any cryptocurrency except Ethereum (ETH) and Bitcoin (BTC).
Technically, they are digital assets created by token contracts and published into blockchains (see What is Network).
Token contract is a special type of smart contract that maps account addresses to token balances.
It is a complex algorithm that manages all receiving and sending requests for a particular token.
When the request is sent, this algorithm adds/minuses from a balance of a specific address.
The process is managed by standard protocols, the set procedures that token contracts follow.
This ensures that a value of 1 token is always equal to the value of any other token of the same type.
Most tokens are not backed by gold, fiat, or physical assets, and are affected by supply and demand.
Stablecoins like Tether(USDT), a.k.a. asset-backed tokens are backed by reserve assets (U.S. dollar).
This backing stabilizes the price of such tokens and simplifies their use as a digital currency.
Some stablecoins are accepted between multiple networks; others are only used within a single one.
Zenland contract allows users to pay with various stablecoins when selling or buying products/services.
Similar to checking transactions and contracts, blockchain explorers are used to check token contracts.
An explorer shows the price per token, its total supply, the number of holders, and transaction history.

Explanation

Except for Ethereum (ETH) and Bitcoin (BTC), nearly all cryptocurrency coins are sometimes referred to as tokens. You may have seen both "coin" and "token" used when mentioning new crypto.

In the blockchain world, a token can be used to represent anything tangible or intangible, and by nature is a digital asset.

A blockchain is simply a database of all the transactions within its network. The records are stored on many computers (nodes) around the world and thus, is a distributed database.

To learn more about the blockchain network refer to "What is Network".

Ethereum explains tokens as assets that mean anything from lottery tickets or skills of a character in a game to shares in a company or ounces of gold.

While this is true for stablecoins, or asset-backed tokens, most tokens are not backed up by assets like gold, real estate, or fiat. The value of these tokens depends on the number of people buying and selling them.

In other words, the supply and demand of the cryptocurrency market, which is influenced by many factors. Media, government regulations, and the number of token holders are all the factors that influence the perceived value of a token.

An example of token volatility is a Dogecoin (DOGE). Launched in 2013, this meme coin has grown 9530% within a year after a famous Elon Musk tweet.

Also, the fathers of the modern currency, Bitcoin (BTC) and Ethereum (ETH), are often on top of "the most unstable cryptocurrencies" lists. This volatility makes it difficult to pay with crypto for products or services.

As a solution and an easier way to use cryptocurrency for daily operations, Tether (USDT), has introduced the first stablecoin in 2014. Because its price is designed to be pegged to a price of a U.S. dollar, it is not difficult to calculate the number of USDT a user must send or receive (1 USDT ≅ 1 USD). This simplifies their use as a digital currency and explains the widespread adoption of stablecoins.

Other commonly used stablecoins pegged to a U.S. dollar include Binance USD (BUSD), USD Coin (USDC), and TrueUSD (TUSD). The price of 1 of any of these coins is roughly equal to 1 USD.

Tokens (and stablecoins) are created and managed by token contracts published into a specific blockchain.

These contracts are the types of smart contracts that keep track of all the transactions involving a specific token. Think of them as a brain controlling the movements of arms and legs. When the transaction is requested from a certain address a token contract maps the address to their token balance. Based on the request, it either adds or deducts X number of tokens from the balance registering every change in the contract.

A smart contract is a special type of a blockchain program which stores encrypted information, dates, and/or cryptocurrency. In simple terms, it is a complex algorithm which performs certain tasks when the set conditions are met.

Learn more on smart contracts.

How does the token contract manage millions of balances and keep track of the total token supply on the network?

Tokens are managed by standard protocols, the guiding principles for all operations with tokens. These protocols are also used by developers when building smart contract applications for fungible tokens, a.i. tokens, and non-fungible tokens (NFTs).

At this stage of development, Zenland does not support NFTs, but has plans to extend the platform's future use. The goal of the current phase is to make smart contracts accessible for people buying and selling regular products/services.

Learn more about smart contract use cases.

These token standard protocols ensure that the value and price of 1 ETH are always equal to that of any other ETH on the blockchain. One of the standard protocols of the Ethereum blockchain, known as ERC-20, ensures the validity and working state of token contracts deployed (published) to the Ethereum network. It allows users to transfer tokens from one account to another and get their token balances.

Similar to viewing network transactions and regular smart contracts, specific details of any token contract can be verified via a blockchain explorer. To get the data you will need to enter the token contract address into the search. Explorers like Etherscan and BscScan have Token Trackers that point to token contracts. Clicking on it will take you to the token contract of the respective token.

An explorer is a specific blockchain search engine that is used to get important details of a particular transaction or contract. These details may include transaction status, its value and timestamp, and receiver's and sender's wallet addresses.

More on how explorers work is in "What is Explorer".

Besides the history of all token transactions, token contract details will show:

the token price (per unit); for example, USD-backed stablecoins will always be around $1 U.S. dollar;
maximum token supply (the amount of all tokens created and regulated by the token contract),
the number of holders (the wallets, who own that token),
the number of transfers (the total number of transactions made with a specific token),
the market capitalization of the token (a valuation of the maximum total supply of the token),
token contract address (the address of the actual token contract in the blockchain),
the official website and social profiles of the organization that have developed a token.

What tokens are used for Zenland contracts?

For ease of calculation, only major stablecoins (listed below) are used at this point. Feel free to leave a suggestion for a particular cryptocurrency here. Please, don't forget to specify its network.

Network

Token name

Token contract

Decimals

Ethereum

Mainnet

null

Tether USD (USDT)

0xdac17f958d2ee523a2206206994597c13d831ec7

USD Coin (USDC)

0xA0b86991c6218b36c1d19D4a2e9Eb0cE3606eB48

Binance USD (BUSD)

0x4Fabb145d64652a948d72533023f6E7A623C7C53

Dai Stablecoin

0x6B175474E89094C44Da98b954EedeAC495271d0F

Binance

Smart Chain

Mainnet

null

Binance USD (BUSD)

0xe9e7CEA3DedcA5984780Bafc599bD69ADd087D56

Tether USD (USDT)

0x55d398326f99059fF775485246999027B3197955

USD Coin (USDC)

0x8AC76a51cc950d9822D68b83fE1Ad97B32Cd580d

Avalanche

C-Chain

null

USD Coin (USDC)

0xA7D7079b0FEaD91F3e65f86E8915Cb59c1a4C664

Tether USD (USDT)

0xc7198437980c041c805A1EDcbA50c1Ce5db95118

Dai Stablecoin

0xd586E7F844cEa2F87f50152665BCbc2C279D8d70

Fantom

Opera

null

USD Coin (USDC)

0x04068da6c83afcfa0e13ba15a6696662335d5b75

Dai Stablecoin

0x8d11ec38a3eb5e956b052f67da8bdc9bef8abf3e

Polygon

Mainnet

null

Tether USD (USDT)

0xc2132D05D31c914a87C6611C10748AEb04B58e8F

USD Coin (USDC)

0x2791Bca1f2de4661ED88A30C99A7a9449Aa84174

Binance USD (BUSD)

0xdab529f40e671a1d4bf91361c21bf9f0c9712ab7

Quick Facts

Explanation

What tokens are used for Zenland contracts?

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