Two individuals in the village sell electricity. They both offer high-quality electricity at the same price, but the source of electricity is different. The first person buys electric generators and works along with a company to fill them with fuel. These generators may either be advanced with unique features or mere replicas of famous generators. As for the other individual, he entered a contract with a top-tier company to acquire energy cables, and he later utilized technical equipment to distribute electricity.
If the equipment used for generating electricity is not duplicated, the cost of the first project will be higher due to the intense competition from leading companies that provide high-quality services. Therefore, it is common to replicate their equipment. In contrast, the second project is less complex and has lower costs involved.
In the scenario mentioned, the first person is more capable of providing electricity than the second person. However, it’s also possible that the second person can start their own energy business by partnering with electricity delivery companies. They can then purchase generators and provide energy directly to consumers. However, if they don’t upgrade the existing electrical wiring with innovative generators, the quality of electricity may decline, and consumers may not notice any improvements.
If we apply this to the cryptocurrency world, technically the first person would have created a coin, while the second person created a token.
The difference between coin and token
A Coin is a type of digital currency that is encrypted and operates on its blockchain. This blockchain stores and regulates the value of the coin as well as all its transactions without the need for an exchange to oversee the process. Examples of coins that operate in this manner include Bitcoin (BTC), Ethereum (ETH), and BNB (BNB). The process of mining coins involves using the Proof of Work (PoW) or Proof of Stake (PoS) consensus mechanism.
A token is an encrypted digital asset created under a smart contract to operate on a specific blockchain. Tokens can provide a wide range of functions and features when operating on decentralized platforms.
Tokens have become of great importance in the world of cryptocurrencies. Stable currencies such as USDT and USDC are tokens and not coins. Non-fungible tokens (NFTs) are also considered as tokens. There are two types of tokens: asset-backed tokens that represent real-world assets such as gold, and security tokens that represent traditional securities like stocks and bonds.
When and why was the coin created?
Bitcoin began as the first cryptocurrency, invented by anonymous individuals. The Bitcoin network has been operational since 2009 and has never been hacked. It operates on an open-source program and was created as an alternative to traditional currencies.
Is there an Arab coin?
As of now, there is currently no cryptocurrency that is specifically referred to as an “Arabic Coin”. However, it has been noted that one of the popular tokens has been inaccurately named. This is a concern as precise naming is crucial in the world of cryptocurrency to avoid confusion among investors. It is worth noting that there is an Islamic Coin.
Why wasn’t AMAL created as a coin instead of a token?
AMAL is a humanitarian token with a primary objective of sponsoring orphans. However, we have approached all technologies with seriousness to create a unique encrypted digital currency. One of the significant items on our roadmap is to create our blockchain, keeping in mind that creating a coin directly may not be considered an innovative approach in today’s world. Most people use the easiest method of using the codes of the Binance Smart Network or the Ethereum network to avoid dealing with complicated codes. Creating a unique blockchain network based on new ideas is a process that requires a strong team and takes a long time. We are currently working towards this goal. There will be a day when the AMAL TOKEN will be migrated to our blockchain and become AMAL COIN.
It should be noted that a number of the famous coins today were tokens circulating on the Ethereum blockchain and were later migrated to an independent blockchain, such as Binance Coin (BNB), Tron (TRX), and Zilliqa (ZIL).
Will converting tokens to coins lead to an increase in their price?
It is difficult to predict the price rise of a blockchain as it depends on the kind of blockchain that will be created, its creativity and distinctiveness. An increase in investors is likely to result in a price rise, but simply transferring the token to its blockchain might not be enough. In some cases, tokens have failed to preform better even after being moved to the blockchain, and their prices were higher when they were tokens. This was due to the poor application of their digital wallet and the poor quality of the blockchain. Therefore, it is important to ensure that the blockchain is of high quality and it is in everyone’s best interest before deciding to move to it. The AMAL TOKEN, for example, has many distinctive technologies, and the team will not move to any blockchain until they are 1000% sure that it will provide the best results possible.