What are the categories of cryptocurrencies?

The main categories of cryptocurrency include: 1. Bitcoin: decentralized, anonymous, limited circulation; 2. Ethereum: programmable, supporting smart contracts and decentralized applications; 3. Stable Coin: low price volatility, high liquidity, convenient as a means of payment; 4. Utility token: related to specific products or services, with use value; 5. Governance token: allows holders to participate in project decision-making; 6. Asset tokenization: improve asset liquidity and reduce transaction costs; 7. Central Bank Digital Currency (CBDC): supported by the government and strictly regulated.

Cryptocurrency Categories

Cryptocurrencies can be divided into several main categories:

1. Bitcoin category:

• Cryptocurrency represented by Bitcoin and based on the proof-of-work mechanism.
• Features: decentralization, anonymity, limited circulation.

2. Ethereum category:

• Represented by Ethereum, a cryptocurrency based on the proof-of-stake mechanism.
• Features: Programmability, support for smart contracts, decentralized applications.

3. Stablecoins:

• Cryptocurrencies that are pegged to fiat currencies or other assets and are designed to maintain a stable value.
• Features: low price volatility, high liquidity, and convenient as a means of payment.

4. Utility token:

• A cryptocurrency that provides practical functions for a specific platform or service.
• Features: Relevant to a specific product or service and have use value.

5. Governance Token:

• A cryptocurrency used to participate in the governance and decision-making of a certain blockchain platform.
• Features: Allow holders to vote on platform development and operations.

6. Asset Tokenization:

• Cryptocurrency that tokenizes real-world assets (such as real estate, stocks, art) .
• Features: Improve asset liquidity and reduce transaction costs.

7. Central Bank Digital Currency (CBDC):

• A digital form of legal tender issued by a central bank.
• Features: Supported by the government and strictly supervised.

It’s worth noting that cryptocurrencies are still evolving, and new categories and subcategories may emerge.

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