Crypto tokens

Crypto Tokens and Coins, what’s the absolute difference?

Crypto tokens and Crypto coins, you might have heard about these and think what’s the difference? The Crypto market is quite lucrative and anyone investing must do thorough research of the risks involved and gains expected. Such research involves basic terminologies like crypto coins and crypto tokens.

Due to recent price surges, the cryptocurrency has caught mainstream media attention and needs no introduction. I am sure everyone is familiar with the term cryptocurrency which can be used with crypto coins. But most people use the terms crypto coins and crypto token interchangeably, which is wrong. Cryptocurrency or crypto coins are different from crypto tokens.

Cryptocurrency or crypto coins

Crypto coins are blockchain’s native currency which is issued by the blockchain protocol on which it runs. For example Bitcoin (BTC) or Ether (ETH ). Crypto coins are decentralized which means they do not depend on a central issuing authority. This decentralized method enables an automated and impartial manner of coins. The underlying structure and network structure are secured by an encryption technique known as cryptography.

Crypto Tokens

Crypto tokens are the one that has a deep connection with crypto coins but don’t have their blockchain. For example, the Etherum blockchain has its coin Ether (ETH) but also contains the tokens like DAI, LINK, and COMP which depend on the Etherum. Crypto tokens have value and can be exchanged just like cryptocurrency but these tokens can represent any physical asset. Tokens can be referred to as a smart contract that can represent any physical or digital asset.

Crypto tokens
List of Etherum-based token Source: Bitkub.com

If you are wondering what we will call if we are to speak of both, then there is also the term ‘crypto assets’ which represent both token and coin.

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About mnmansha

MN Mansha is a cryptocurrency expert, trader, and content writer with extensive experience in covering everything related to digital assets — from price analysis to Blockchain disruption. Mansha authored 100+ stories for NewsBSC.com and other fintech media outlets and he's actively writing more every day. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.

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