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Key Differences Between Crypto Coins And Tokens
The crypto industry has said that the main difference between coins and tokens is that crypto coins are the native asset of a Blockchain like Bitcoin or Ethereum, whereas crypto tokens are created by platforms and applications that are built on top of an existing Blockchain.
Crypto Coins: Cryptocurrency depends on a blockchain, a decentralized ledger, for transaction security. This sets them apart from the centralized databases used by most financial institutions to track transactions. Coins can be used to pay for products and services, saved for later use, and divided into fractions of the total amount. Coins typically develop their own infrastructure, with control over how they are created, how they are protected from assaults, how their supply is controlled, how transactions are processed or recorded, and who they reward.
Crypto Tokens: Tokens do not have their own blockchain or distributed ledger. Tokens are digital representations of assets. These 'tokens' can be kept for their face value, sold, or staked' to generate interest. Tokens are used in decentralized applications (DApps) that are typically developed on top of an existing blockchain. Tokens benefit from an existing blockchain without requiring their own infrastructure. They can also be used for fundraising, pre-ordering, or investing, as well as for creating an ecosystem or community.
