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Driving Smart Contract Adoption through Fungible and Non-Fungible Tokens


btcmanager.com 2020-07-30 09:20
Reading time: ~5 m

Smart contract platforms are often touted as the catalysts that will catapult the blockchain economy to the next level, and it is hard to argue otherwise as they can be utilized to perform myriad tasks in a secure, transparent, and cost-effective manner.

While several smart contract protocols are still finding their way around in this nascent industry, RSK smart contracts continue to prove their mettle by leveraging distributing ledger technology (DLT) to bring about impactful socio-economic changes in society.

RSK Blockchain Spearheading Smart Contracts Adoption

Unlike the vast majority of competing protocols built on top of Ethereum, RSK smart contracts use the most reliable and trusted blockchain network of all, the Bitcoin network.

For the uninitiated, smart contracts are self-executing contracts written in the form of a code that includes the terms and conditions between two or more entities. These contracts execute automatically once the input condition is met. As they are powered by DLT, smart contracts cannot be influenced by any external factor which ensures complete transparency and immutability.

RSK smart contracts are increasingly being deployed across various industries, including supply chain management, banking, insurance, entertainment, government administration, charity, and public welfare.

In this article, we will explore how RSK blockchain is rewriting the fabric of blockchain tokenomics through its smart contracts. Specifically, we will look into the multitude of ways in which RSK smart contracts are making finance more accessible to all through digital tokens.

Fungible and Non-Fungible Tokens

While there are numerous types of digital tokens that fuel the blockchain ecosystem, they can broadly be categorized under two buckets – fungible and non-fungible tokens (NFT).

Fungible tokens are tokens that are interchangeable and not unique. All fiat and cryptocurrencies are fungible tokens.

Conversely, NFTs have their peculiar characteristics and are not interchangeable. A ticket to a music concert is an NFT. To learn more about non-fungible tokens, click here.

RSK’s Contribution to Blockchain Tokenomics

RSK is enabling a future where finance is easily accessible to all and is not subject to bureaucracy and red-tapism. This, RSK believes, can be achieved by re-engineering the DNA of the traditional finance industry to make it less centralized.

The exponential growth of the decentralized finance (DeFi) space in the blockchain industry is a clear indication of the strong user demand for decentralized finance platforms.

In that regard, RSK smart contracts are powering several DeFi platforms to ensure that no individual is deprived of easy access to finance.

RSK Smart Contracts Enabling Open Finance via Fungible Tokens

For instance, take the example of Money on Chain (MOC), an RSK blockchain-powered DeFi protocol that allows the creation of bitcoin-collateralized stablecoins and other DeFi products based on bitcoin.

Money on Chain’s ecosystem is primarily driven by three fungible tokens, namely:

1) Dollar on Chain (DOC) – a stablecoin pegged to USD

2) BPRO – a utility token that allows users to generate passive income

3) MOC token – the protocol’s governance token

Similarly, the RSK blockchain network is being used by RIF on Chain (ROC), a DeFi protocol backed by RIF tokens that aims to provide its users a fast, secure, and cost-efficient platform to borrow digital funds.

Akin to Money on Chain, the RIF on Chain mechanics are also orchestrated by three platform digital tokens:

1) RIF Dollar (RIFD) – a stablecoin pegged to USD

2) RIFpro (RIFP) – a utility token that enables users to earn passive income in RIF tokens

3) RIFX – a RIF leverage decentralized long position products

Notably, all the six aforementioned tokens use RSK smart contracts to keep their respective platform’s economy in motion and subsequently allow users to borrow and lend funds without any hassle.

To learn more about how RSK blockchain is leading the adoption of the Bitcoin-collateralized DeFi economy, click here [insert RSK stablecoins blog post.]

Protecting Intellectual Property with Non-Fungible Tokens

Beyond powering fungible tokens such as stablecoins and other cryptocurrencies, RSK smart contracts are also being tapped to develop NFTs. Unlike fungible tokens, that are mostly used as currency, the number of potential use-cases for NFTs is huge. NFTs can be used across a plethora of industries that require proof of asset-ownership and data legitimacy. These include supply chain, banking, real estate, intellectual property (IP), and charity & public welfare, among others.

A live example of RSK smart contracts being used to protect intellectual property is the Watafan app. Watafan enables personal idols around the world to create their own digital trading cards in the form of NFTs. These digital trading cards are given away by idols to their fans as gifts after being autographed (signed) cryptographically from their personal wallet on the RSK blockchain.

Through Watafan, RSK smart contracts network addresses a key problem in the entertainment industry, that of copyright infringement and piracy. By digitizing assets through NFTs, RSK smart contracts make certain that idols from all sectors enjoy unparalleled protection of their digital property while simultaneously receiving revenue on each trade taking place among fans in the secondary market.

If you wish to create your own such collectible NFT using the RSK network, make sure to check out the tutorial here.

Conclusion

With the blockchain space snowballing into a larger industry with every passing day, it is only a matter of time when we start witnessing the real-world application of this emerging technology in our daily lives.

One of the more significant factors to shape a blockchain-driven economy would be the tokenization of assets. In addition to making it easier to prove the ownership of an asset through NFTs, tokenization also opens exciting investment opportunities through novel financial products.

Against that backdrop, RSK blockchain remains committed to laying the foundation for an open financial system that not only helps bank the unbanked but also provides decentralized and transparent financial platform alternatives in the form of MOC and ROC.


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