Cryptocurrency and the difference between tokens

in words: difference from tokens

It is believed that crypto and tokens are the same. Both types of cryptoassets can be traded on exchanges and transferred between blockchain addresses. . Functionally, all cryptocoins are interchangeable. This means that one coin is worth the same as any other.

For example, Bitcoin and other early cryptocurrencies were developed as currencies. But later blockchains are designed for extended functionality. The same Ethereum, in addition to currency tasks, gives developers the ability to run code (smart contracts) on a distributed network and create tokens for decentralized applications.

Cryptotokens can be used like any other crypto, but they are distinguished by greater flexibility. The protocol that supports smart contracts involves separating the base currency (used to pay for transactions or applications) directly from cryptotokens. If we talk about the Ethereum project again, then ETH acts as the native currency: it is needed to create and transfer tokens on the Ethereum network. The crypto tokens themselves are implemented according to the ERC-20 or ERC-721 standards.