What are Colored Coins? (Explained)

The exact utility of bitcoin is much diverse and wide. There is only one cryptocurrency that has changed the view of people toward the entire cryptocurrency class and that’s none other than bitcoin itself. A decade earlier, one could not have imagined the heights bitcoin has scaled in the present time. The ultimate popularity of bitcoin rose in the mid-2016-17s when the cost of bitcoin as well as its return was at its peak. The time of Covid-19 is another milestone in the history of bitcoin wherein every other market failed, but the digital market stood still. With time, bitcoin has changed its usual course of action and as a result, is advancing toward its betterment. For more information you can visit (bigmoneyrush.io)

A general term for the bitcoin revolution is the advent of Bitcoin 2.0 and colored coins are the synonym for the same. In this article, we will discuss the scope of colored coins and will try to clear doubts about the same. 

About Colored coins- 

Gone is the time when only digital assets find their way into the blockchain. Colored coins can act as an effective tool for expanding the utility of bitcoin and its role in the blockchain. The role of colored coins is not merely limited to the digital era but is equally applicable to the physical world. The issuance of colored coins is based on the fact that these can be used to represent almost anything in the physical and digital space. This anything represents assets in the forms of various stocks and shares, any type of commodities, physical real-estate entities, currency in fiat, and other related crypto coins and currencies. Colored coins can also be said to be the tokens that represent items of physical assets on the soft spaces of blockchain. Thus, anyone can prove their ownership of physical assets with the help of these colored coins.

Ease of issuance 

One of the features of colored coins is the ease of their issuance. Apart from offering a series of interesting features, these are so easy to get issued that many people are on their way to getting them issued. As a result, the overall utility of bitcoin has increased and a whole new set of bitcoin has emerged in the form of Bitcoin 2.0. As this concept is a bit new, people using it are quite low in number now. But, according to recent studies, the future of colored coins is bright and is towards the right path. 

Reason for the creation of colored coins

Many people think that despite having a wide range of feature-abled bitcoin, what is the need for colored coins? So, the answer to this question is the creation of another competitor in the form of ERC-20 tokens. Also, the product of an ICO is an easy task with regard to these colored coins. An ICO can be made in a few minutes and the cost involved in this operation is significantly less. Thus, this facility is an advantage to the entire crypto fraternity and is constantly adding advantages to it. 

Scope and potential of colored coins

We all know that for running bitcoin and its derivatives one of the prior requirements is the availability of a constant and secure network. If you have an internet connection, you can access any device from any place remotely. Making a bitcoin transaction is as easy as making an SMS or email. The connection is secure in the form of P2P. colored coins being one the types of bitcoins have inherited the features and advantages of bitcoin. So, it is equally usable and scalable as a bitcoin.