The words “coin” and “tokens” are used in the crypto community quite frequently. But, unfortunately, many people still don’t know the difference between them, and think they are synonyms. This is not true. There are quite a lot of differences between coins and tokens, so let’s determine them.
What is a Coin?
A coin is a form of digital money created through encryption techniques which store value. The most popular coin is, of course, Bitcoin. These kinds of digital assets are also known as “digital money” and are gaining popularity very quickly.
A coin acts as money and has all the characteristics of money: durability, portability, divisibility, uniformity, limited supply, and acceptability. Coins are tied to a public blockchain, may be sent, received or mined, and can’t do any other function besides acting as money.
What is a Token?
Now that we’ve discussed the main characteristics of a coin, let’s talk about a token and how it’s different from a “coin”.
Tokens are also digital assets that are issued by a blockchain-based project and can be used as a payment method inside its ecosystem performing similar functions as coins. However, the main difference is that the holder has the right to participate in the network.
Tokens can be digital assets or they can represent the company’s shares. To better understand how a token works, compare it to a gift card. For example, you got a gift card of a specific shop. You can buy anything there within the limits of your gift card, but you can’t use the same card to buy products at any another store. Digital tokens work the same way, as they can be used only inside certain projects.
Tokens themselves also differ from one another. There are utility and security tokens. Security tokens are designed to be the company’s share, while utility tokens can be used in a project.
PXP token
PoinPay offers its own token called PXP. PXP is a utility token of the ERC-20 standard, based on the Ethereum - the most popular platform for building blockchain systems.
You can participate in the crowdsale of our token. Visit our website for more information and don’t forget to follow us on Social Media!
