1/5 Did you know that crypto tokens and coins are not exactly the same thing?
I will try to explain how to distinguish a #coin from a #token and their different uses.
I will try to explain how to distinguish a #coin from a #token and their different uses.
2/5 Many people call Token and Coin “#cryptocurrency” interchangeably, they are not the same thing. Although both use distributed ledger technology (also known as #blockchain technology), there are some significant differences between a coin and a token.
3/5 Coins are a form of digital currency often native to a blockchain, with the main purpose of storing value and functioning as a medium of exchange.
When #Bitcoin was created, it was envisioned as a replacement for traditional fiat currencies.
When #Bitcoin was created, it was envisioned as a replacement for traditional fiat currencies.
4/5 Tokens are digital assets built on top of an existing blockchain (using #smartcontracts) and can perform a wide variety of functions, from representing a physical object to granting access to platform-specific services and features including utility, security, and governance.
5/5 BONUS: Are #Stablecoins coins or tokens?
Most of them are actually ERC-20 tokens. The name is given by their primary function as a medium of exchange.
Typically a stablecoin is backed by FIAT currency, held by the token-issuing company, to maintain stable value.
Most of them are actually ERC-20 tokens. The name is given by their primary function as a medium of exchange.
Typically a stablecoin is backed by FIAT currency, held by the token-issuing company, to maintain stable value.
If it is more clear the difference between tokens and coins:
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