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 How does a blockchain work?  What can be written in these famous the premiere of a show, priority product
In practice, a blockchain is a database registers (DLTs)? acquisition or to benefit from an exclusive
that contains the history of all exchanges D Ts (blockchain for the general public) or lower-priced service.
made between its users since its creation. encompass virtual financial assets (or A Security Token has the characteristics
The Banque de France explains its main cryptocurrencies), FTs, Utility Tokens and of traditional financial instruments. During a
characteristics thus: Financial Tokens. Security Token Offering (STO), the company
- the identification of each party is carried According to the AMF (France’s stock market wishing to raise funds will issue financial
out by a cryptographic process; regulator), a cryptocurrency or crypto asset tokens. The securities are offered to investors,
- the transaction is sent to a network (or refers to “virtual digital assets that are who subscribe to the securities in return
storage node) of computers located around based on blockchain technology through for the remittance of the funds. An STO is
the world; a decentralised ledger and an encrypted similar to an ICO. Financial tokens are issued
- each node hosts a copy of the database in computer protocol.” Cryptocurrencies are for the first time on a market. The exchange
which the history of the transactions carried created by a community of internet users, of financial tokens will then take place on a
out is recorded. All stakeholders can access also called miners, using an algorithm that secondary market. The operation is similar to
it simultaneously; generates tokens which are then allocated to that of the traditional stock market. The STO
- the security system is based on a consensus each miner as a reward for their participation gives the right to financial compensation in
mechanism of all the nodes each time in the operation of the system. Once created, the same way as stock dividends.
information is added. Data is decrypted and these tokens are stored in an electronic A Non Fungible Token ( FT) is a unique and
authenticated by data centres or miners. The safe, saved on the user’s computer, tablet non-interchangeable token, representing in a
transaction thus validated is added to the or laptop, or even remotely (for example digital format a right attached to an asset.
database in the form of a block of encrypted in the cloud). It is then possible to transfer In common parlance, a thing is said to be
data (this is the “block” in blockchain); them anonymously via the internet between “fungible” if it can be replaced by something
miners are rewarded for their work with members of the community. of the same kind, quality and quantity, such
cryptocurrencies; According to Mon gasque law, a crypto as money for example. The first FT was
- decentralised security management prevents asset is the representation in digital form of created in 2014 and FTs gained momentum
transaction forgery. Each new block added to a property or a right of heritage, including, in from 2017, with the Ethereum platform
the blockchain is linked to the previous one particular, digital assets and financial tokens. where the CryptoPunks and Crypto itties
and a copy is transmitted to all the nodes of A virtual financial asset is a crypto asset. It projects (using FTs) were born. In 2021,
the network. The integration is chronological, is defined as “the representation of a value Everydays: The First 5,000 Days, by artist
indelible and tamper-proof (source: Bercy). which is not issued or guaranteed by a central Mike Winkelmann aka Beeple, sold for 69.3
bank or by the state, which is not necessarily million. It is the most expensive piece of
 What is a Central Bank Digital Currency attached to a currency having legal tender digital art in history to date.
(CBDC)? and which does not have the legal status of
A digital currency is offered and issued by a currency but which is accepted by natural  What is a digital service provider (DSP)?
the central bank of a sovereign country. or legal persons as a medium of exchange As in France, the provision of services related
Although it uses blockchain technology, it and which can be transferred, stored or to digital assets has been subject to regulation
is issued by the state as a centralised form exchanged electronically.” and approval since aw 995 passed on 30
of digital currency, which differentiates une 2022. The Minister of State must
it from cryptocurrencies. Currently, 90%  What are the different sorts of tokens? give prior approval to actors in the following
of central banks are considering creating Mon gasque law defines a token as an cases: exchanging digital assets for other
their own digital currency. CBDCs have intangible asset representing, in digital digital assets; operating a digital asset trading
already been launched in igeria and the format, one or more rights, goods or services, platform; exchanging digital assets for legal
Caribbean countries. For example, it is which may be issued, registered, stored or tender currency; issuance of crypto assets;
currently possible to hold Sand Dollars in transferred by means of D T and which makes the custody or administration of crypto assets
the Bahamas or e airas in igeria, each it possible to identify, directly or indirectly, or access to crypto assets where applicable,
issued and regulated by the country’s central the owner of said property.” in the form of private keys, with a view to
bank. The central banks of the United States, A Utility Token is a token representing a holding, storing and transferring crypto
China and Europe are also working on this, right to use goods, products or services. assets; and operating a platform for displaying
with the European Central Bank (ECB) aiming Utility Tokens represent rights issued by a crypto asset buying and selling interests. The
for implementation by 2027. On its website, company that has carried out an Initial Coin Financial Activities Supervisory Commission
the institution indicates that the digital euro Offering (ICO). ICOs are forms of fundraising must grant its approval for activities involving
would literally “look like euro banknotes but in carried out by legal persons using a digital financial tokens, namely: the placement of
a digital version. It would be electronic money, recording device on a shared ledger, such as crypto assets; the execution of orders on
issued by the Eurosystem (the ECB and the a blockchain. The investor receives tokens in crypto assets; the reception and transmission
national central banks of the eurozone) and exchange for the funds invested. They can of orders on crypto assets; and crypto asset
accessible to all citizens and businesses.” give the right to a free trial of a new product, consulting.

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