Cryptoasset Anti-Financial Crime Specialist (CCAS) Certification Practice Test

Question: 1 / 400

An initial coin offering (ICO) of utility tokens provides which incentive to investors?

Voting rights in the project

Fixed investment terms, meaning no loss of funds

Future redemption for products or services

The incentive provided to investors in an initial coin offering (ICO) of utility tokens primarily revolves around future redemption for products or services. This means that investors purchase these tokens with the expectation that they will be usable for accessing the project's offerings once it is fully operational. This utility aspect is what distinguishes utility tokens from other types of tokens, such as securities, and emphasizes their role in the ecosystem of the project.

Investors are motivated to buy utility tokens because they believe in the potential of the project and want to participate in its growth and success. By holding the tokens, they can later exchange them for the products or services that the project intends to deliver, creating a direct benefit linked to the demand for those offerings.

The other choices present alternative forms of investor incentives that do not typically apply to utility tokens in ICOs. For instance, voting rights, fixed investment terms, and guaranteed profits may pertain to other types of investment securities or structures but are not inherent features of utility tokens provided through ICOs. Thus, it is the future redemption aspect that clearly outlines the primary incentive for investors in this context.

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A guaranteed profit

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