A utility token is a digital asset that provides users with access to a product, service, or functionality within a blockchain ecosystem. Unlike security tokens, utility tokens are not meant for investment but serve a functional role, such as paying transaction fees, accessing features, or participating in governance. While utility tokens are not classified as securities in most cases, regulatory clarity varies. They are common in DeFi, gaming, and dApp platforms.
Example:
Examples include ETH for executing smart contracts or BNB for trading fee discounts. Their value is driven by the demand for the underlying service rather than company profits.
