Cryptocurrencies have made one complete circle and have transformed into a cumbersome, different ecosystem, constituting coins and tokens. While both token coins are digital assets, they cater to different goals, use cases, and different infrastructures that support them. Essentially, for an investor, trader, or enthusiast who seeks to invest, trade, or grow in crypto space, the fundamental understanding of token vs coin and what difference between coin and token becomes very crucial. So in this article we will delve into demystifying such questions as what is coins crypto, what is coin token, key difference between coins and finally give the answer of difference between token and coin.What is cryptocurrency?A cryptocurrency coin is a digital asset that runs on its own blockchain. Coins are the native currency of their respective blockchains and mainly provide transaction, payment, and value storage functions.The main properties of coins include:Independent blockchain: Coins exist on their independent blockchains-for example, Bitcoin on the Bitcoin network, Ethereum on the Ethereum network.Transaction medium: Coins have value, like traditional money, and can be used to buy something or pay for something. Mining and Staking: Most coins are mined or staked through methods called Proof of Work or Proof of Stake.Examples of coins: Bitcoin (BTC){:target="_blank" rel="dofollow"}, Ethereum (ETH){:target="_blank" rel="dofollow"}, Binance Coin (BNB){:target="_blank" rel="dofollow"}, Litecoin (LTC){:target="_blank" rel="dofollow"}. How it works: Coins will always use the underlying infrastructure of the respective blockchain for processing transactions and security.Example of how coins workBitcoin is applied as a method of payment, decentralized.Ethereum introduces the ability to create smart contracts.BNB is used inside the Binance ecosystem as a fuel for transaction processing.What is a cryptocurrency token?The cryptocurrency token is a digital asset that works on some blockchain - not independently. Usually, the issue and control of tokens are made by the smart contract and hence it is more flexible than token coin.Main features of tokens:Built on another blockchain: Tokens are not on a blockchain but built on an already existing network. Examples include the ERC-20 tokens on Ethereum.Smart Contracts: Tokens use smart contracts, which allow for programming their purposes, from governance and utility to security.Variety of using: They can be applied in many scenarios, such as assets, rewards, NFTs, or voting rights on the blockchain network.Examples of tokens:Utility Tokens: Avail certain services within the blockchain ecosystem. Examples include Chainlink LINK and Uniswap UNI.Security Tokens: These are representatives of an external asset, such as stocks or real estate.Stablecoins: These are pegged to real-world currencies. Examples include USDT and USDC.How Tokens Work:Tokens make use of the underlying infrastructure of their parent blockchain. For example:ERC-20 tokens, which are Ethereum-based tokens, draw security and decentralization from Ethereum.BEP-20 tokens run on Binance Smart Chain.Solana tokens are created on the Solana blockchain.Coin vs Token: which is the difference?The most remarkable difference between a coin and a token lies in the infrastructure and purpose.Blockchain: Coin tokens operate independently on their blockchain, while tokens are created on other blockchains, including Ethereum, Binance Smart Chain, and Solana.Function: The main functions of coins are payments, transactions, and staking-used as a store of value or a medium of exchange. Tokens have multifarious usages, from utility and governance to NFTs, security, or even decentralized applications. Creation process: Coin tokens need full blockchain development and are rather difficult to create. Tokens are at the same time created with smart contracts on existing networks and therefore quite easy to deploy.Examples: Renown examples of coins include Bitcoin, Ethereum, Binance Coin, and Litecoin; on the other hand, commonly known tokens include Tether, Uniswap, Chainlink, and Polygon.Mining and Staking: Most token coins are either mined or staked for the security of the network and the issuance of new units, such as Bitcoin's Proof of Work or Ethereum's Proof of Stake. Tokens do not need mining and are distributed by either smart contracts or pre-issued by the project team.Understanding these differences is important for both investors and developers alike, as coins and tokens fulfill different purposes within the crypto ecosystem.Why does it matter whether something is a coin or a token?Investors and developers in crypto need to understand the difference between token and coin. If you're an investor, knowing whether or not a digital asset is a coin or a token can give you insight into its long-term potential. If you're looking to create a project, your choice between issuing a coin or a token depends on the level of control and customization required.ConclusionA coin and a token differ in infrastructure and use cases. While a coin operates on an independent blockchain, a token exists on an already existing network. Both of them are vital in the crypto ecosystem, and understanding their differences will help you make more effective investment and development decisions. Whether you're looking to trade, invest, or build, the differentiation of token and coin will give a better understanding of how digital assets function within the blockchain space.