DIFFERENCE BETWEEN TOKEN AND COINS - Making it as simple as abc for beginners with great illustrations
Coins are digital assets that operate on their own independent blockchain. Tokens are digital assets that operate on an existing blockchain network.
In the world of cryptocurrencies, a coin is like the cool kid at school, the native cryptocurrency of a blockchain. It's the default currency, the one that gets to ride shotgun in the blockchain's metaphorical car. For example, Ether (ETH) is the default currency on the Ethereum blockchain. It's the big cheese, the head honcho, the one that gets to call the shots.
On the other hand, a token is like the new kid at school, who comes in and borrows the blockchain's network to make a name for itself. Tokens are created on existing blockchains and rely on the infrastructure provided by the native coins. They're like the blockchain's little helpers, performing various functions and serving different purposes.
In simpler terms, a coin is to a blockchain what a dollar is to the US economy - it's the main currency that keeps everything running smoothly. A token, on the other hand, is like a gift card or a casino chip - it has value and can be used within a specific ecosystem, but it's not the main currency of the broader economy.
So, there you have it! The difference between a token and a coin is all about their relationship to the blockchain
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