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 TokenDefineToken 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 TokenIn 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