What is a Token? Discover the Latest Types of Tokens in 2024

In the general financial market and particularly in the realm of cryptocurrencies, Token is an indispensable term. So, what is a Token? How does it operate? Let's find out right away!

A token is an encrypted electronic device that generates random numbers (digital signatures) for each online transaction. These codes are similar to OTP – they are used only once and are randomly generated

Although they are just numbers, token codes are considered mandatory passwords to carry out online transactions, replacing traditional signatures and having similar legal value.

There are two main types of tokens:

Hard Token: A physical device like a USB, convenient to carry around.

Soft Token: Software installed on electronic devices like phones, computers.

Nowadays, not only banks but many businesses also use tokens to enhance the security of online transactions. The compact, portable design allows users to carry them when needed.