The Knowledge Shot - Coin Vs Token: What Are The Differences?

Coin Vs Token: What Are The Differences?

Coin

A coin is a digital asset that is native to its own blockchain. It is primary use is to be a store of value and transfer money between people.

To secure its blockchain network, coins are either staked (Proof of staking) or mined (Proof of work).

Examples: Bitcoin, Ethereum, Monero, Binance coin.

Token

A token is a digital asset that has been issued on an existing blockchain. For examples, tokens issued on Ethereum blockchain are called ERC20. Tokens can be staked but cannot be mined.

ERC20 is a protocol defining rules and standards to issue tokens on Ethereum blockchain. It stands for Ethereum Request Comments and 20 and can be used to represent many things such as voting rights, shares, currencies, real estate, etc. Any assets can be tokenised.

Examples: Synthetix, Maker, Kyber, Gnosis.

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Secret Salsa