Crypto Coins vs Tokens: What's the Key Difference?

In the vast world of cryptocurrency, there are numerous digital assets that operate in different ways. Two terms that often get used interchangeably, coins and tokens, have distinct characteristics that set them apart.

Crypto coins are digital assets that run on their own blockchain, providing a native infrastructure for recording transactions, maintaining balances, and reaching consensus among network participants. The defining feature of a coin is its relationship with its own blockchain, as seen in Bitcoin (BTC) and Ether (ETH), which operate on the Bitcoin and Ethereum blockchains respectively.

Tokens, on the other hand, are created and operate on existing blockchain networks, leveraging their infrastructure and security. Tokens can represent various things such as access to a product or service, participation in governance, representation of an asset, or usage within a particular application or ecosystem. The flexibility of tokens is one reason why there are numerous types in the crypto market.