1. PixelPlaygroundHome
  2. Blockchain Briefs

What Does Payment Token Mean (The Role of Payment Tokens)

• Blockchain Briefs • 93 views

Payment token refers to the functionality of a virtual commodity or service tha

What Does Payment Token Mean (The Role of Payment Tokens)

Payment token refers to the functionality of a virtual commodity or service that can be represented in a global application, using blockchain technology and possessing the legal characteristics and accounting units equivalent to currency, as reported by LongHash. In other words, it is a means of transaction represented in encrypted digital form, allowing people to buy, sell, and receive a certain type of service or item. For example, you can reward someone by transferring a certain amount to their wallet address; you can also convert a code into a digital asset and use it to exchange for corresponding remittance fees; or you can convert it into fiat currency for others to purchase.

Overall, what does payment token mean? There are two main reasons:

1. Bitcoin is considered a good tool for storing value, but its high volatility makes it difficult for it to be used as a daily payment method.

2. Due to the lack of excessive control by any centralized institution, it is challenging for Bitcoin to become the mainstream payment system in the financial market.

3. Bitcoin itself is not a fully decentralized currency system.

The Role of Payment Tokens

Payment tokens represent a new way of applying blockchain technology in the financial sector.

Previously, mainstream Chinese internet companies such as Tencent and UnionPay have launched digital currency payment services. However, due to their limited development and global user base, they have been unable to achieve large-scale commercial implementation and promotion. Payment tokens have laid a solid foundation for these traditional payment services. The concept of “payment tokens” was first proposed and established by the Zhongguancun Blockchain Industry Alliance in November 2017, aiming to address the problem of information asymmetry in the financial industry.

As one of the payment solutions under the “double off-chain” network model, “payment tokens,” “one-click issuance,” and “instant withdrawals” have become some of the most popular features currently. As a result, they have received widespread attention and support from industry insiders. In the future, this system will expand to more scenarios through various functions.

The advantages of payment tokens lie in their electronic wallet dominance, which includes features such as queryability, security, real-time monitoring, and privacy protection. By using smart contracts to encrypt transactions, instant clearing and settlement can be achieved, reducing risks and preventive measures. (Sina Finance)

In addition, it is also a major product following Alipay. Based on its unique distributed ledger technology, a new cross-border remittance and payment ecosystem has gradually formed.

This article and pictures are from the Internet and do not represent Fpips's position. If you infringe, please contact us to delete:https://www.fpips.com/24382/

It is strongly recommended that you study, review, analyze and verify the content independently, use the relevant data and content carefully, and bear all risks arising therefrom.

Like (0)
Previous 08/16/2023 19:17
Next 08/16/2023 19:41

Recommended articles