There are plenty of tokens with interesting use cases. However, that doesn't mean all tokens are bad investments or that all coins are good ones. Ethereum did, helping it to become the second-largest cryptocurrency by market cap.īecause it's much easier to create a token than a coin, there are far more scams and lackluster projects launched using tokens. These cryptocurrencies operate on Ethereum's blockchain instead of their own, which makes them crypto tokens (the official term for tokens built on Ethereum are ERC-20 tokens).Įarlier cryptocurrencies, such as Bitcoin ( CRYPTO:BTC), didn't have this capability. Because it's programmable, developers can use it to launch their own cryptocurrencies. One of the things that made Ethereum special is that it was the first programmable blockchain. Since Ether has its own blockchain, it's considered a crypto coin. Ethereum is a blockchain, and this blockchain's native cryptocurrency is called Ether. To make it clearer, let's use Ethereum ( CRYPTO:ETH) as an example. Crypto coins have their own underlying blockchains crypto tokens don't.
crypto coinsĪ cryptocurrency can be a coin or a token, depending on whether it's the native cryptocurrency for its own blockchain or not. If a cryptocurrency doesn't have its own blockchain and instead uses another cryptocurrency's blockchain, then it's considered a token. For example, as a cryptocurrency's transactions are confirmed, they would be grouped into a block, and that block would then be added to the blockchain.Įvery cryptocurrency is built on a blockchain. This information can be transaction records or full-fledged programs that operate on the blockchain, which are called smart contracts. Crypto tokens are digital assets that are built on another cryptocurrency's blockchain.Ī blockchain is a digital ledger that stores information in blocks that are linked.
0 kommentar(er)
