Coin vs Token
In the context of cryptocurrency, coins and tokens are two distinct types of digital assets, and here’s how they differ:
Coins:
- Coins like #Bitcoin❗ and #Ethereum have their own blockchains.
- Coins are often used to transfer wealth and can be mined or staked.
Tokens:
- Tokens are built on existing blockchains; for example, ERC-20 tokens use the Ethereum network.
- They represent assets or utilities within a specific ecosystem.
- Tokens can be used for investment purposes, to represent a stake in a project, or to access certain functionalities of a project.
In essence, coins operate independently, while tokens are dependent on the underlying technology of the platform they are built on. Both play vital roles in the crypto world but serve different purposes within their respective ecosystems.
