Digital tokens are cryptographic assets that exist on a blockchain and represent value, ownership, or access to a specific asset, service, or network. They are fundamental to decentralized ecosystems, enabling secure, transparent, and verifiable transactions without intermediaries. Digital tokens can be used for cryptocurrencies, non-fungible tokens (NFTs), decentralized finance (DeFi), and tokenized real-world assets.

How Digital Tokens Work:
Digital tokens are issued and managed through blockchain-based smart contracts that define their functionality and rules. They can be classified into different types based on their properties and use cases:

Fungible Tokens (e.g., ERC-20, BEP-20): Interchangeable and divisible tokens used as cryptocurrencies or utility tokens within blockchain networks.
Non-Fungible Tokens (NFTs - ERC-721, ERC-1155): Unique, indivisible tokens representing digital art, collectibles, gaming assets, and intellectual property.
Security Tokens: Represent real-world financial assets like stocks, bonds, or real estate in a tokenized form.
Utility Tokens: Provide access to products or services within a specific blockchain ecosystem, such as governance tokens or payment tokens.

Digital tokens are stored in cryptographic wallets and can be transferred, traded, or staked within blockchain networks. By digitizing value and ownership, digital tokens drive innovation across industries, from finance to entertainment and beyond.