The tokens that have a specific “use” on the blockchain or its App are

utility tokens, also known as “app coins” because of their being explicitly

designed for a certain app or blockchain. For this reason, the utility tokens

are intended exclusively for such specific use and are not investment

instruments.

Investments, such as shares, bonds, funds are represented by security tokens

digitally, on the other hand. Security tokens are the securities of companies,

fund houses, or real estate funds issued via the blockchain, representing

profit participation, interest income, or to give voting rights or generate

profits for the holders of those tokens.

Therefore, the security tokens are subj ect to various state regulations and

legal frameworks to which the issuer must adhere to, whereas this does not

apply to utility tokens.

Conclusion

This chapter introduced you to Ethereum, which is a decentralized, self-

contained economy for transactional computation and its related data, an

open blockchain platform that lets anyone build and use dApps that run on

blockchain technology. An introduction to Ethereum and an explanation of

the difference between Ethereum and Bitcoin is provided. Next are

discussed the programming languages for Ethereum, Ethereum Virtual

Machine, and the layers of the Ethereum platform. An explanation of

accounts both externally owned and contract accounts, Wallets, a

comparison between accounts and wallets, Gas—

the cost unit together with

the issue of rising ETH gas fees that has led to the rise of Layer 2 protocols

such as polygon is discussed next. The process of creating a block of

transactions to be added to the Ethereum blockchain is explained in mining

and the steps of mining. Block, its structure, its size, the block creation

difficulty adj ustment methodology, U ncle block, block timing, and ETH are

explained next. Further discussed are smart contracts, their transactional

rules, their advantages together with dApp, the difference between smart

contracts and dApp.

For creating your own cryptocurrency using the solidity programming

language, its environment set up, syntax, reserved words, rules to follow are

discussed. ERC-20, ERC223 , ERC621, ERC7 21, and ERC827 Standard

Tokens, a comparison between a security token and utility token are

.