There is no single definition of “token”. The FSB defines a digital token as “any digital representation of an interest, which may be of value, a right to receive a benefit or perform specified functions, or may not have a specified purpose or use” (FSB: Crypto-assets: Work underway, regulatory approaches and potential gaps, 2019).
Figuratively speaking, a token can be considered a “digital envelope” that contains a set of information in codified form. In the case of a security, this may include the economic terms (eg issuance amount, coupon rate, redemption date, pre-approval and transfer conditions). In the context of crypto markets and financial markets, tokens or “digital envelopes” always exist in a blockchain or DLT network.
Further reading:
ISO 24165-1:2021(en): Digital token identifier (DTI) — Registration, assignment and structure — Part 1: Method for registration and assignment
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