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🎯 The difference between a token and a coin

  • Thread starter Thread starter Bored Ape Crypto Club
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Bored Ape Crypto Club

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A coin is the main unit of account on its own blockchain: BTC, ETH, AVAX, BNB, etc.

All the functioning of a certain blockchain revolves around the main coin. The coin is used to pay for any transactions within its blockchain. In the Ethereum network, the fee for any transaction is paid in ETH. Coins are used for staking to ensure the security of the network. The same ETH staking is used to achieve consensus in the network.

Tokens are created and work on top of an existing blockchain.

It is easier for developers to launch a token in an already working proven network than to make their own blockchain from scratch to suit their needs.

In the future, developers can switch from a token to their blockchain with their own coin if they decide that this is necessary. For example, ETH and BETH. BETH is a wrapped Ether token in the Binance Smart Chain network with built-in staking profitability. Or restaking. At the entrance, we give the ETH coin, and in return we receive the rsETH token.

There are also tokens with which you can vote for decisions on the platform. For example, the STG token for the Stargate bridge or UNI for the Uniswap exchange. The more tokens you hold, the more weight you have in your vote.
 
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