Here are some statements that I think are true (are they all true?)
- Each company that does an ICO creates a limited number of tokens.
- Those tokens can be used the pay for the products/services that the company sells or will sell.
- The tokens are the only thing that can be used to buy the company's products/services, because if they accepted other forms of payment then the value of their tokens would pretty much drop to zero (since there's nothing special about them anymore)
Q1 - Are all of those statements true? If no, which are false?
I also have a few other questions. Here they are:
Q2 - Token prices can fluctuate dramatically.
Is that not a problem for the company that created the token, because it means the price to buy their product/service is also fluctuating dramatically? For example say that my company wants to charge $10 per month for a service we provide. But since we did an ICO, we're charging customers in tokens rather than in dollars. So rather than $10 per month, we're charging 1 token per month. If the today the tokens have a low value of $0.10, then my company isn't earning enough monthly revenue. If next month demand drives the token price up to $100 per token, then we're over-charging customrs and they won't want to pay for our product. It seems to me that no company could survive if they were unable to charge a stable price for their product/service.
Q3 - When customers pay for a product or service with tokens, does the company then have to re-sell those tokens back into the market so they can be used by other customers in the future? Because if they didn't, then eventually there would be no more tokens left in the marketplace so no one could
Q4 - Is there some kind of requirement in place for companies to only accept their own tokens as payment for their products/services, and not other tokens or other cryptocurrencies?
I think I'm clearly misunderstanding a few things about how tokens work. If anyone can help to clear up my misunderstandings I'd appreciate it!
