Crypto Coin Vs Crypto Token: What is the Difference?
Almost everyone gets confused when it comes to differentiating coins and tokens. They both are very much alike on a fundamental level but, still exhibit different properties. Before we explore coins and tokens let’s understand digital assets.
Let’s Dive in to Explore Digital Assets!
A Digital asset is a non-tangible asset that is created, stored, and traded on a virtual platform in a digital format. In the context of Blockchain Development, Digital assets refer to cryptocurrencies and tokens. They are the subclasses of digital assets that utilize cryptography and encryption methodologies that assure the authenticity of these assets.
Cryptocurrency Definition You Need to Know!
A Cryptocurrency or a crypto coin is termed to be the native asset of the blockchain network which is traded, used for storing value, and utilized as a medium of exchange. The crypto coin is considered to be Blockchain’s native currency as it is issued directly by the blockchain protocol.
Crypto coins are not only used to execute transactions on the network but also to incentivize users and keep the network secure.
Characteristics of Cryptocurrencies You Shouldn’t Miss!
- Cryptocurrencies are decentralized in nature i.e. there is no central authority governing or controlling the transactions.
- Crypto coins use cryptography to secure the system
- Crypto transactions are irreversible as no authority can help the users in case the transaction goes wrong.
Token Definition You Should Study!
Tokens are defined as digital assets defined by smart contracts on the existing blockchains. These crypto tokens share deep compatibility with the coins on the same network but, they are completely different digital assets. A wide array of token standards used for token development are majorly built on Ethereum. The most commonly used token standard for token development is ERC-20 and ERC-721.
Benefits of Tokens You Shouldn’t Ignore!
- Crypto Tokens can be traded globally across the world ensuring access to millions of investors.
- The smart contracts integrated into the tokens ensure transactions are traceable, irreversible, and transparent.
Difference Between Crypto Coins and Tokens You Didn’t Know!
Let’s Wrap Up
Hopefully, you have understood the thin line of difference between coins and tokens. For further queries, you can connect to our team.
If you are looking for token development service, we are the right choice for you. Launch your crypto coin or token with us now!
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