{"id":62474,"date":"2022-10-03T12:40:43","date_gmt":"2022-10-03T07:10:43","guid":{"rendered":"https:\/\/mudrex.com\/blog\/?p=62474"},"modified":"2024-03-24T16:28:34","modified_gmt":"2024-03-24T16:28:34","slug":"difference-between-coin-and-token","status":"publish","type":"post","link":"https:\/\/mudrex.com\/learn\/difference-between-coin-and-token\/","title":{"rendered":"6 Key Difference Between Coin and Token: Coin vs. Token"},"content":{"rendered":"\n

Comprehending crypto jargon can be a complex and daunting task, especially terms like coin and token. Most of us would have confused a coin with a token at some point in our crypto journey. Some might even think both are the same.<\/p>

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Although coins and tokens represent blockchain-based digital assets<\/a>, they are technically distinctive. This article will explore the difference between coins and tokens, their use cases, and examples.<\/p>\n\n\n\n

<\/span>What Are Crypto Coins?<\/strong><\/span><\/h2>\n\n\n\n

A crypto coin refers to any cryptocurrency with its own blockchain rather than running on another blockchain. In other words, crypto coins are native to their own blockchain. <\/p>\n\n\n\n

When Bitcoin hit the market, it established the standard for what it means to be a coin. Coins, like traditional currencies, are primarily designed to act as a medium of exchange and store value.<\/p>\n\n\n\n

<\/span>What Are Crypto Tokens?<\/strong><\/span><\/h2>\n\n\n\n

Crypto tokens aren’t native to a blockchain. They are built on another blockchain, utilizing the underlying smart contract functionality to offer various services.<\/p>\n\n\n\n

While crypto coins are equivalent to traditional currencies, tokens are more like assets (both physical and digital). Presently, a token can represent digital art or music, a share of ownership in a DAO<\/a>, and even coupons or vouchers.<\/p>\n\n\n\n

<\/span>Difference Between Coin and Token: Coins Vs. Tokens<\/strong><\/span><\/h2>\n\n\n\n

The table illustrates the critical differences between crypto coins and tokens.<\/p>\n\n\n\n

Parameters<\/strong><\/td>Crypto Coins<\/strong><\/td>Crypto Tokens<\/strong><\/td><\/tr>
Blockchain<\/strong><\/td>Native to their own blockchain<\/td>Built on another blockchain \u2013 mainly, the Ethereum<\/a> network<\/td><\/tr>
Use Cases<\/strong><\/td>Initially, created as a replacement for fiat currencies, but evolved with the help of smart contracts<\/td>Utility, Security, Governance, and NFTs<\/td><\/tr>
Quantity per blockchain network<\/strong><\/td>Only one coin per blockchain<\/td>Multiple tokens can exist on the same blockchain<\/td><\/tr>
Price level<\/strong><\/td>Generally higher than tokens<\/td>Lower than crypto coins<\/td><\/tr>
Distribution<\/strong><\/td>Mined through Proof of Work (PoW) or earned through Proof of Stake (PoS) protocol<\/td>Created and distributed by project developers<\/td><\/tr>
Examples<\/strong><\/td>BTC<\/a>, ETH<\/a>, BNB<\/a>, XRP<\/a>, ADA<\/a><\/td>USDT<\/a>, USDC<\/a>, DAI<\/a>, UNI, SLP<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

P.S. Crypto coins or tokens, invest in both using Mudrex Coin Sets<\/a><\/p>\n\n\n\n

<\/span>Use Cases of Crypto Coins<\/strong><\/span><\/h2>\n\n\n\n

Crypto coins are bootstrapped from scratch instead of relying on existing blockchains. They are typically used for one purpose: to act as an alternative to fiat currencies.<\/p>\n\n\n\n

Coins hold the following properties.<\/p>\n\n\n\n