Do you know the difference between token and cryptocurrency?

Cryptocurrency:

Cryptocurrencies are digital currencies native to a blockchain, for a cryptocurrency to exist the blockchain first needs to exist. Cryptocurrencies are issued by the blockchain itself to guarantee the usability and security of the network, they are used as reward payments for miners who guarantee the functioning of the network with your processors.

Cryptocurrencies are born on the blockchain and are native "children" of it, such as cryptocurrencies: ETH, ADA, SOL, Matic, BNB, Doge... All of these cryptocurrencies are actually coins, as they have their own blockchain and are native to it, they they work through the blockchain consensus mechanism and are part of the network’s initial code.

In short, cryptocurrency has its own blockchain, every cryptocurrency necessarily needs to have its own blockchain but not every blockchain has its own cryptocurrency.

Fun fact: Any native blockchain cryptocurrency optional to Bitcoin is called an altcoin.

Blockchains exist to provide security to transactions, they function as an accounting ledger and record everything that happens on the network, there are blockchains for all types of purposes, from financial blockchains to gaming blockchains, such as the Gala games blockchain.

Token:

The tokens, in turn, are not native to a blockchain, they are programmed through a smart contract within a third-party blockchain, however, a token cannot be deployed on any blockchain because for this to happen, the blockchain necessarily needs to be compatible with smart contracts.

Tokens are less complex than a cryptocurrency, basically the token is a script with pre-programmed functions to be executed when any of its functions are activated.

The costs to implement a token are absurdly lower compared to a cryptocurrency because the cryptocurrency necessarily needs its own blockchain to exist, whereas tokens can exist on third-party blockchains.

Examples of tokens: Shiba, TWT, Baby doge...

Tokens are typically created with the aim of tokenizing a project to raise initial funds.

Example: You have the idea of ​​creating an electric bicycle company but you don't have the resources to do so, so you design the scope of your project, tokenize it and open a sale to first identify acceptance of your project within the community and secondly raise funds to kickstart your idea.

When an idea is successful and the community embraces the project it can have great returns for the investors who participated in this proposal.

Note: All this movement of creating, collecting, selling... a token is carried out through smart contracts to guarantee the security of the project and investors, so whenever you want to buy a token, before doing anything, check inside of the blockchain to see if the contract is secure and if the project is being transparent, remember that smart contracts are immutable after it is deployed on the network it never changes again, since what is on the website the project writes whatever it wants In other words, it is manipulable, so never trust 100% what is written on the website, always check everything within the blockchain to avoid falling for scams.

Curiosity: The vast majority of token projects begin their initial fundraising in the DeFi (Decentralized Finance) market, as the costs are relatively lower than launching the project directly on a CEX (Centralized Exchange).

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