What is the difference between a Crypto Currency Coin and a Crypto Token

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What is the difference between a Crypto Currency Coin and a Crypto Token

The main difference between a cryptocurrency coin and a token is how they are built and used:

1. Cryptocurrency Coin

  • Has its own blockchain: Coins operate on their own independent blockchain (e.g., Bitcoin runs on the Bitcoin blockchain, and Ethereum runs on the Ethereum blockchain).
  • Used for transactions: Coins are primarily used as a form of digital currency (e.g., Bitcoin (BTC) is used for payments and as a store of value).
  • Examples: Bitcoin (BTC), Ethereum (ETH), Binance Coin (BNB - now on BNB Chain), Solana (SOL).

2. Cryptocurrency Token

  • Built on an existing blockchain: Tokens are created on top of an existing blockchain, like Ethereum, Solana, or Binance Smart Chain, using smart contracts.
  • Used for various purposes: tokens can represent assets (like stablecoins or NFTs), be used in DeFi applications, or grant governance rights in DAOs.

3. Examples:

  • Utility Tokens: Chainlink (LINK), Uniswap (UNI)
  • Stablecoins: USDT (Tether), USDC
  • NFTs: Digital art, in-game items

Key Takeaways

Has own blockchain?

  • Coins: ✅ Yes 
  • Tokens: ❌ No (uses another blockchain)

Primary use?

  • Coins: Digital currency        
  • Tokens: Utility, governance, DeFi, NFTs

Examples                 

  • Coins: BTC, ETH, SOL   
  • Tokens: USDT, UNI, LINK, NFTs


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