Token & Coin | What is the difference ?

[liamclark]

In Cryptocurrency, coin and token concepts are sometimes used interchangeably. This usage is not necessarily wrong, but can be misleading.

What is a Token? Sort of Token

Define

Token is an cryptocurrency issued during the ICO (Initial Coin Offering).

Since the ICO concept may be mistaken for a Coin release, some projects have switched to the ITO (Initial Token Offering)  concept in conjunction with the TGE (Token Generation Event) for a more accurate look.

Token is based on a coin platform. For example, the majority of today's tokens are released on the Ethereum platform based on the ERC-20 standard. Some other tokens are based on NEO, WAVES, STELLAR, and Bitcoin platforms.


Sort of Token

In terms of features, we can divide the tokens into two types:

- Ultility Token: Created to serve a project with specific goals and features. For example, the token for the Dock.io project has a paid feature; Binance's BNB token reduces transaction fees, ...

- Security Token: Is a stock type issued in the form of a token. You will receive dividends based on the number of shares you own in the project. Security token also allow you to vote or participate in deciding some of the project's work.

What is Coin?

Coin is a cryptocurrency that is released on a blockchain basis with basic features like smart contract, sending and receiving, mining, ... Coin is created to solve billing, security issues, finance, application development, etc.

Some typical coins: Bitcoin (BTC), Ethereum (ETH), NEO, Stellar (XLM), Cardano (ADA), ...

How to distinguish Token and Coin?

CoinMarketCap is a website that distinguishes between Token and Coin

[Mark X]

The difference between coins and tokens is:
Coins / altcoins
Alternative coins / altcoin / coins are an alternative to Bitcoin. The majority of altcoins are a fork from Bitcoin, using Bitcoin's open source protocol with coding changes to create new types of coins with different features.
Examples of altcoins that are a variant of coding Bitcoin are Namecoin, Peercoin, Litecoin, Dogecoin and Auroracoin.
There are also other altcoins that do not come from the Bitcoin open source protocol. Instead, the coin was created using blockchain and new protocols. Examples of these coins include: Ethereum, Ripp le, Omni, NXT, Waves and Counterparties. This type of Altcoin has its own blockchain that records the transaction process of the coin.

Token.
Tokens are a proprietary representation of assets, which generally use other existing blockchain technologies. It can be said that tokens are all forms of tradable assets, for example: commodities, data, rewards points, currencies, and others.
Making tokens is much easier because we don't need to modify the coding of a protocol or create a new blockchain from scratch. All we need to do is follow the template of a blockchain - for example the Ethereum or Wave platform - which allows us to create our own tokens.
This process can occur with the existence of a smart contract; computer programs that can work automatically and do not require a third party to operate them.
Tokens are created and distributed to the public at large through the Initial Coin Offering (ICO), which is a form of fundraising by selling cryptocurrency for people to participate.

So the main difference between coins and tokens is in the structure; A coin is a currency that uses its own blockchain platform, while a token operates using another blockchain that can facilitate a smart contract.

[GreenAnat]

Oh, you answered in great detail and understandably on the popular question! Thank you! I have often been confused with these two concepts: a token and a coin. Now I have a clear idea and what's the difference. And also, to get more clarity helps site coinmarketcap))

[elrugrim]

Really cool material, but I did not understand one thing.
Is Ethereum altcoin or it is just token? Because different figures from your material show different stuff.
I always believed that ETH is altcoin as it is fulli independent fron other coins.

[liamclark]

Really cool material, but I did not understand one thing.
Is Ethereum altcoin or it is just token? Because different figures from your material show different stuff.
I always believed that ETH is altcoin as it is fulli independent fron other coins.

The main difference between Altcoin and Token is their structure; Altcoin is a separate currency with its own blockchain while Token is based on a blockchain that supports the creation of decentralized applications. So Ethereum can be seen as a Token 

[jimely0907]

In my opinion the difference of token to coin, token is from the newly starting project, they gave token to airdrop and bounty reward, and coin is if the project is already in the exchange site like kucoin,binance, that is my opinion the difference of token and coin

[JQCrypto]

This is a very detailed comparison and it is quite easy to understand.
But let's take it even easier:
- Coin: Have it own blockchain (for example: ETH, BTC, NEO...)
- Token: Dont have it own blockchain, it lives on another blockchain (for example, currently: CMT, ABT, QKC...)

[littlemark]

CoinMarketCap is a website that distinguishes between Token and Coin, very useful

[jimely0907]

A very promising project presentation, its a music related project its nice to participate to this project more power to the team

[Classroom404]

Well from my perspective token this are owned by new coin just doing the ico and has not yet gotten their blockchain while coin this are already established project that has their own blockchain

[amskdkd]

Well from my perspective token this are owned by new coin just doing the ico and has not yet gotten their blockchain while coin this are already established project that has their own blockchain

I agree with you

[prashadraj205000]

majority of today's tokens are released on the Ethereum platform based on the ERC-20 standard.released on a blockchain basis with basic features

[AndrewBrown]

From what I have come to understand, Coins are independent of themselves while tokens are not. Coin, have a blockchain technology of their own, but tokens do not, and have to make use of a temporary blockchain technology of another coin. I think this is the major difference between them.

[Eleven86]

Realjjly cool material, but I did not understand one thing.
Is Ethereum altcoin or it is just token? Because different figures from your material show different stuff.
I always believed that ETH is altcoin as it is fulli independent fron other coins.

I agree with you ethereum is entirely different from ICO's every coin has their own block chain system like ETH, BTC. Similarly token do not have block chain system. This is it was need to be explained.

[awosesun]

Coins are just method of payment while tokens may present a company’s share, give access to product or service and perform many other functions. Coins are currencies that can be used for buying and selling things. You can buy a token with a coin, but not vice versa. Coin operates independently, while token has a specific use in the project’s ecosystem.

Creating a token is easier than creating a coin, as you don’t have to create a new code or modify already existing one  you just use a standard template from platforms like Ethereum, that are blockchain-based and allow anyone to create tokens in just few steps. Using a template for creating tokens provides smooth interoperability, so users can store different types of tokens in one wallet. Ethereum was the first to simplify the process of creating a token, being not the last reason why tokens flooded the market.

[xminer2014]

Not really any difference yet though as people are just using both as investments to speculate with, other than a few like ETH and Binance.

[superscommessebitcoin]

Not really any difference yet though as people are just using both as investments to speculate with, other than a few like ETH and Binance.

I think that there is a difference, because in addition to the fact that people use tokens and altcoins as just a way to enrich, there is still a difference between them and if, for example, Ethereum dies, then I understand that all the tokens that used the Ethereum blockchain will also die.