A coin is a digital asset with its own independent, autonomous blockchain. The best-known examples of coins are Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC). All three have their own blockchain network on which transactions are recorded and validated. These coins operate autonomously, and therefore do not need to rely on another blockchain to exist.
Corners can be used as a means of payment, exchange and speculation. However, this type of cryptocurrency will be used more as a store of value.
Let's take the example of Bitcoin, considered the pioneer of cryptocurrencies. Bitcoin relies on its own blockchain, where all transactions are recorded and secured through a decentralized mining process. Similarly, Ethereum has its own blockchain on which smart contracts and decentralized applications (dApps) operate.
A token is a digital asset that does not have its own blockchain. For example, Uniswap (UNI), Chainlink (LINK), Compound (COMP) and Aave (AAVE) are all tokens. Unlike coins, tokens are based on pre-existing blockchains. These tokens are created and managed via smart contracts, which establish specific rules for their issuance and use.
Tokens have a wide range of use cases and can represent various assets, functionalities and rights. Token use cases include blockchain-based cryptocurrencies, stablecoins, decentralized application tokens and non-fungible tokens (NFT).
Take, for example, UNI, the native token of the largest Uniswap exchange platform. This is an ERC-20 token, as UNI is developed on the Ethereum blockchain and therefore derives its functionality, security and value from this blockchain. Another example of a token is BUSD, a stablecoin based on the Binance Smart Chain (BSC) blockchain. NFTs (Non-Fungible Tokens) include CryptoPunks and Bored Apes.