Bitcoin surpassed the $1,700 mark thanks to Donald Trump and crypto-tokens
Bitcoin reached a record-high of $1,747, up 80% since the beginning of the year, according to the Wall Street Journal.
Donald Trump’s victory and the potential for more relaxed regulations have helped the digital currency. But bitcoin is also gaining in value because it’s being used in connection to crypto-tokens.
Crypto-tokens became popular in recent years. They are often smart contracts built on top of the blockchain, the same structure that supports currencies like bitcoin and ethereum.
They can be used in a process that is similar to crowdfunding.
A company wanting to raise funds offers tokens to potential buyers. Those who buy them become investors, having a say in how the company is run.
The process is similar to an IPO and even has a similar name, Initial Coin Offering (ICO). One essential difference is that some startups sell tokens even before starting business or launching products.
The problem is that no one knows how legal these things actually are, though some are trying to suggest legal frameworks.
But like bitcoin or ethereum, much of these crypto-token-based offerings are unregulated.