Crypto tokens and Crypto Coins are two different forms of digital assets in the cryptocurrency world. While both are used for investment and transaction purposes, there are key differences between them:
Definition: A crypto coin, also known as a cryptocurrency, is a standalone digital asset that operates independently and has its own blockchain. Examples of crypto coins include Bitcoin, Ethereum, and Litecoin. On the other hand, a crypto token is a digital asset that is built on top of an existing blockchain, such as Ethereum.
Purpose: Crypto coins are designed to be used as a medium of exchange and store of value, similar to fiat currencies. Crypto tokens, on the other hand, are often created to represent assets such as property or stocks or to be used as utility tokens that give users access to a particular application or service.
Creation: Crypto coins are created through a process called mining, which involves solving complex mathematical algorithms to validate transactions and add new coins to the blockchain. Tokens, on the other hand, are usually issued through an Initial Coin Offering (ICO) or a token generation event, in which the tokens are distributed to investors in exchange for funding.