Difference between cryptocurrency coins and tokens

[karsyla]

Hello!

I am a little unsure here yet, so that's why I am posting it here - I just need some clarification. The main question here is - are coins and tokens the same thing or not?
From what I've read, I understand it like this:

Bitcoin, Ethereum, LTC, monero, dash etc. - cryptocurrency, coins, a medium of exchange, digital money

Tokens - they are based on Ethereum blockchain and they are adhering to a certain set of standards called ERC20, examples of those ERC20 tokens would be Gnosis, Golem, Aragon, OmiseGO etc. - all the cryptos that are kinda like derivatives of Ethereum and hence they are called tokens.

Now, these tokens, they are not used as a digital money like BTC or ETH, instead they have their own other purpose as a medium of exchange - for example Aragon is used to manage organizations and companies, and Augur is related to prediction markets, Civic is a tool for identity verification based on blockchain. So, these tokens are not exactly money, they are different tools for different purposes based on the blockchain technology. They have the price (the value) though.

Do I get the concept right here? If I am mistaken anywhere, please feel free to correct me and help me to come closer to understanding.

[Faroxx]

The main difference between coins and tokens in the fact that coins have their own blockchain, and the tokens are based on Blackeye coins. For example, LTC, BTC, XMR and ETH icey your own blockchain and by this they coins. CND, PPP, BMC is based on Ethereum and it's tokens.

[Edrian]

Hello!

I am a little unsure here yet, so that's why I am posting it here - I just need some clarification. The main question here is - are coins and tokens the same thing or not?
From what I've read, I understand it like this:

It is correct, but not all tokens are made using the ethereum platform, some token has been created using waves platform etc. And has been operating with also different purpose as other coin does.

[buwaytress]

Another way I like to explain in simple terms is that coins are generally generated or "mined", with every addition of a new block on its blockchain. These stay in circulation.

Tokens are generally created all at once, its entire supply at the same time. They are distributed, not mined.

[ajqjjj]

Another way I like to explain in simple terms is that coins are generally generated or "mined", with every addition of a new block on its blockchain. These stay in circulation.

Tokens are generally created all at once, its entire supply at the same time. They are distributed, not mined.

There are two categories of cryptocurrency are
1. Coins
2.Tokens
 1. Some alternative coins is a altcoin. But simply called coins. This is like a open source original protocol. So it is entirely new coin in different features.
 2. Simply tokens are modify a protocol. It will adopt the some other protocol. Creating tokens also much easy.
 

[hatshepsut93]

You understand coins correctly - they are created with a purpose of being used as money. With that in mind, it's easy to define tokens - we can just say that tokens are any crypto (or blockchain) assets that have purpose other than being used as money. Tokens can represent some property or some digital goods, they can be securities or used as internal unit of value of some network.

Here's a good image from reddit that sorts some popular cryptocurrencies by their types - https://i.imgur.com/SJMeCBU.jpg

[bitart]

Another way I like to explain in simple terms is that coins are generally generated or "mined", with every addition of a new block on its blockchain. These stay in circulation.

Tokens are generally created all at once, its entire supply at the same time. They are distributed, not mined.

To interpret it to a real life thing:
Coin: Money
Token: Shares (of different companies)
Not this simple, of course, but you can understand the difference between the two things based on that.

[McKane]

Another way I like to explain in simple terms is that coins are generally generated or "mined", with every addition of a new block on its blockchain. These stay in circulation.

Tokens are generally created all at once, its entire supply at the same time. They are distributed, not mined.

There are two categories of cryptocurrency are
1. Coins
2.Tokens
 1. Some alternative coins is a altcoin. But simply called coins. This is like a open source original protocol. So it is entirely new coin in different features.
 2. Simply tokens are modify a protocol. It will adopt the some other protocol. Creating tokens also much easy.
 

Coins are basically most stronger after get token they create there own currency which they give to those people who are having these token while coins is contributed after launch so i suggest to people that both are better but first of all we need to see the market too.

[karsyla]

Thank you all for the answers!

So, do those tokens have any future? People are going to use cryptos more and more, unless there is a big thing which would take it down which is very unlikely to happen, but what about those tokens? I have heard some countries are planning to employ blockchain for identity purposes, so this may work, but other than that?

and also, how to distinguish a coin from a token then?

I have always though that all those alts are derivatives of BTC since they are all based on blockchain, but it's the same for tokens, since they are based on ETH and ETH is based on blockchain as well?

[hatshepsut93]

Thank you all for the answers!

So, do those tokens have any future? People are going to use cryptos more and more, unless there is a big thing which would take it down which is very unlikely to happen, but what about those tokens? I have heard some countries are planning to employ blockchain for identity purposes, so this may work, but other than that?

and also, how to distinguish a coin from a token then?

I have always though that all those alts are derivatives of BTC since they are all based on blockchain, but it's the same for tokens, since they are based on ETH and ETH is based on blockchain as well?

Some of them might find a long term success, but many other will fail due to lack of fundamental developments in blockchain technology, since it is still in its early stage. Take the DAO for example - people invested 50 million dollars worth of ETH in a token that was meant to be a decentralized funding platform and it got immediately hacked and required a hard fork for the whole Ethereum network to undo the damage. A lot of token sales (aka ICO's) are just scams that don't actually plan to work on anything - they just have whitepapers and well-designed ANN's to lure investors. So, in general it's a bad idea to hold many tokens for a long term and hope that they will increase in value.

[chr.rit]

And is the existence of a token an advantage for the underlying coin (e.g. market cap, transactions, etc)?

[karsyla]

Thank you all for the answers!

So, do those tokens have any future? People are going to use cryptos more and more, unless there is a big thing which would take it down which is very unlikely to happen, but what about those tokens? I have heard some countries are planning to employ blockchain for identity purposes, so this may work, but other than that?

and also, how to distinguish a coin from a token then?

I have always though that all those alts are derivatives of BTC since they are all based on blockchain, but it's the same for tokens, since they are based on ETH and ETH is based on blockchain as well?

Some of them might find a long term success, but many other will fail due to lack of fundamental developments in blockchain technology, since it is still in its early stage. Take the DAO for example - people invested 50 million dollars worth of ETH in a token that was meant to be a decentralized funding platform and it got immediately hacked and required a hard fork for the whole Ethereum network to undo the damage. A lot of token sales (aka ICO's) are just scams that don't actually plan to work on anything - they just have whitepapers and well-designed ANN's to lure investors. So, in general it's a bad idea to hold many tokens for a long term and hope that they will increase in value.

So tokens indeed are like shares, because their price depends on the success of their built system and those really are not money?

[949miner]

Yes tokens are like shares or coins that represents the value of the marketcap, they both work by the same way, but i prefer coins because they are much more safer than tokens.
You all know that all the tokens who are in the market are Ethereum based tokens, and probably 1/10 of them are Waves tech based.
Tokens are more symple to develop, that is why they are cheap and doesnt have a strong marketcapitalization.

[ngesotcoy]

I think the basic difference between cryptocurrency coins and tokens: coins are brings a whole set of solutions to platforms, token is just basically something that can be used on a specific platform.

[karsyla]

Which ETH wallet would you recommend? I am thinking either MEW or Mist, but MEW is an online wallet which I do not like that much..

[Almat]

The simplest analogy I was able to find is that you could treat tokens like arcade tokens. You can buy them from the arcade, and they can only be spent there. In crypto token sense, ether is your money, and the crypto token is your arcade token. You can only use them on the platform they were designed for, just as you can only spend the arcade tokens on that specific arcade.

Coins are more versatile and can be used in non-specific platforms.

[gesdan]

the bif different between token and coin is architecture coin based from new blockchain platform and they maintenance it maunally, and the token are made by ethereum smart contracts, its mean that all of it is managed by etherum smart contract

[webtricks]

Which ETH wallet would you recommend? I am thinking either MEW or Mist, but MEW is an online wallet which I do not like that much..

Even though MEW is online wallet, still it requires private keys or other medium to access wallet. Thus it is view only wallet. But risk is associated when you hurriedly try to open wallet without looking for url. It is through phishing pages.
Else MEW is completely safe wallet.

[karsyla]

Which ETH wallet would you recommend? I am thinking either MEW or Mist, but MEW is an online wallet which I do not like that much..

Even though MEW is online wallet, still it requires private keys or other medium to access wallet. Thus it is view only wallet. But risk is associated when you hurriedly try to open wallet without looking for url. It is through phishing pages.
Else MEW is completely safe wallet.

But it stores priv keys on their servers, doesnt it?

[Cryptotalker]

Which ETH wallet would you recommend? I am thinking either MEW or Mist, but MEW is an online wallet which I do not like that much..

Even though MEW is online wallet, still it requires private keys or other medium to access wallet. Thus it is view only wallet. But risk is associated when you hurriedly try to open wallet without looking for url. It is through phishing pages.
Else MEW is completely safe wallet.

But it stores priv keys on their servers, doesnt it?

From their website:

MyEtherWallet.com does not hold your keys for you. We cannot access accounts, recover keys, reset passwords, nor reverse transactions. Protect your keys & always check that you are on correct URL. You are responsible for your security.