Decrypting Cryptoassets: Introduction To An Emerging Asset Class
36 Pages Posted: 15 Nov 2018 Last revised: 16 Sep 2019
Date Written: August 1, 2019
This paper, which is intended for a nontechnical audience, aims at explaining the blockchain technology and addressing misconceptions about crypto-assets. We define crypto-assets as all assets that are based on a distributed blockchain. The greatest misunderstanding consists of the fact that not all crypto-assets are cryptocurrencies. It is true that each distributed blockchain has a native currency. However, it primarily serves as an incentive mechanism for individuals to maintain and update a network. Crypto-assets can also be used as a means of cloud storage or cloud computing. Understanding how different crypto-assets interact with blockchain and what other purpose (if any) the native currency fulfills is key to establishing a comprehensive classification. Crypto-assets present two main categories: blockchain and protocol crypto-assets. Each main category presents several subgroups that are discussed in detail throughout this paper.
Keywords: Cryptoasset, Cryptocurrency, Blockchain, Network Dynamics, Consensus Mechanism, Heterogeneity, Classification, Coins and Tokens
JEL Classification: G19, G23
Suggested Citation: Suggested Citation