# Review of Blockchain Tokens Creation and Valuation
## 3 Blockchain Tokens Development
### Definition and Classification  
To provide a comprehensive understanding of the blockchain tokens, from their creation to classification, it is required first to provide an overview of the meaning appointed to this concept in addition to the concept of tokenomics and tokenization. [PERSON] et al. [94] consider blockchain tokens not to have an intrinsic definition, but rather as a tool to exchange value within the blockchain, while the process of tokenization is the encapsulation of digital or real-world assets and assigning them a digital representation (token) that can be traded on the blockchain. This process allows any kind of value to be managed and exchanged as a digital asset and highlights the ability to shift from economics to tokenomics, where tokenomics represents the switch from economics, where stakeholders react to changes, to token economics, where the stakeholders adjust to the tokens [20]. The concept of blockchain token and its inception remain highly dependent on the blockchain platform that allows its creation [17]. From a birds-eye view, the blockchain can be divided based on its permissions (permissioned/permissionless) and its privacy (public/private) [95; 2]. Being on a permissioned blockchain allows better control over which actors have the right to create tokens, and if the blockchain is private, all of the value associated with can also remain private. In this case, there is a higher degree of trust among participants but the process of joining the network is less democratic and transparent. On the opposite side, there are public permissionless blockchains that provide transparency and give all participants the right to create their digital value, through tokens. [PERSON] [96] divides the tokens into five categories, namely digital money (including stablecoin), exchange (buy/sell and trade with other tokens), service platform (fundraising tool), wallet, and marketplace (used in commodity trading), while it identifies three relationships between addresses: creating, holding, and controlling. The main characteristics of the tokens are identified by [PERSON] et al. [94] by analyzing over 40 platforms as technical (e.g., technological stack and blockchain infrastructure), behavior--possible actions with the token, inherent value with the factors that influence its price), and coordination between actors of the token-based ecosystem. Additionally, a morphological framework is proposed  
Figure 6: Smart Contract structure. by [PERSON] et al. [20] to further categorize tokens based on the ability to burn, expire, spend, fungible, divide, and trade from a behavior perspective and based on the underlying value, supply strategy, and incentive from the coordination standpoint. [PERSON] et al. [97] consider a different viewpoint regarding token taxonomy and focus on three directions: security token, utility token, and payment token. The security tokens represent investment products that can provide cash flow and voting rights to investors. Utility tokens are usually issued through initial coin offerings (ICOs) are designed for community-based ecosystems and provide consumption rights to the owner. The last category, payment tokens (cryptocurrencies), represent payments. Other categories can be defined as presented by [PERSON] et al. [56], such as token standards UTX0, that are based on a native blockchain asset with additionally attached assets (e.g., Colored Coins [98]) or layer-based (e.g., metadata transactions Omni (mastercoin)) [99]. In addition to on-chain token creation and ownership transfer, the ability to tokenize off-chain is described in certain scenarios. The process flow considered contains a full circle between tokenization and token burning, meaning the process when the token is no longer required but allows for accountability. Finally, the tokens can be categorized based on their ability to be interchangeable or fungible [97]. While FTs can be interchanged, in the same way as money, since they all have the same value, this is not the case for unique NFTs.