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The difference between a cryptocurrency coin and a protocol token

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The two most often confused and interchangeably used terms, crypto coins, and tokens explained. Understand coins vs tokens on coinnounce

The two most often confused and interchangeably used terms, crypto coins, and tokens explained

 

The blockchain technology has unexpectedly spurred a lot of other new fields. The cryptocurrencies being one of the first mainstream adoptions of the blockchain technology there are a few other concepts within the industry which apply the blockchain technology. For an instance, the protocol tokens are different from the cryptocurrencies, but both of them apply to Blockchain Technology itself. Let us try to understand the basic characteristics which differentiate a cryptocurrency coin from a protocol token.

Both of them are most often regarded or assumed as being circulated as a currency but actually, it is not the case. Bitcoin is regarded as a currency because it is a medium of exchange and a store of value. But due to the high momentum, all the tokens, as well as the coins, were termed as cryptocurrencies, which is not correct.  They incorporate completely separate ways of cryptography. This confusion can be a great disaster for the newcomers in the field.

 

Cryptocurrency coin

Cryptocurrency coins are just a digital version of the Fiat currencies that we use on a day to day basis. Bitcoin is one of the best examples of a cryptocurrency coin. The transactions that take place using Bitcoin are stored on an immutable ledger which is distributed throughout the network for verification and transparency. The Blockchain network reduces fraud and increases transparency.  There are a number of other cryptocurrencies which are created on the original Bitcoin protocol, proposed by the anonymous group of people named, Satoshi Nakamoto like Litecoin, Namecoin, etc. There also cryptocurrencies like Ripple and Monero which are developed on their own separate blockchain protocol. Each and every cryptocurrency coin needs to have some basic characteristic features to qualify itself as a coin, They are as follows.

The coin should be

  • Fungible
  • Divisible
  • Acceptable
  • Portable
  • have a Limited supply.

The cryptocurrency coins can be sent, received, and can also be mined. They can, in no circumstances, act differently from a currency.

 

Tokens

Cryptocurrency token is very similar to the cryptocurrency coin but a token can be used as a part of an ecosystem. A token gives the owner, the right to participate, in that particular network. The functionalities of a token are unlimited and their existence only seems to be valid inside a particular ecosystem, outside of which they become null and void. A token might be used to represent a company’s share, give access to the project’s functionalities, or used as a digital asset. With every launch of a new project, a new functionality of the token is unraveled.

One of the most real-life examples of a token is a ticket for a particular concert. The ticket is valid only within the premises of the concert and sometimes may be valid at other designated restaurants and places. Security tokens, as well as utility tokens, are the two types of tokens which are available in cryptocurrency market. Security tokens are mostly considered to be a security while representing the share of the company, but the utility tokens find its application outside the ecosystem also.

Creation of a particular coin is a cumbersome process as the user needs to have a vast amount of knowledge about the Blockchain Technology. On the other hand, the creation of tokens doesn’t require that much information, one can use a standard template provided by some of the most successful Blockchain platforms. The Ethereum network provides the best service in this matter where the creation of tokens can seamlessly be undertaken by following a few simple steps.

 

Conclusion

A cryptocurrency coin can just be used as a transfer of value but a token can represent a company’s share within that ecosystem. A token might be necessary to access particular financial services that the blockchain network provides. Similarly, cryptocurrency coin can be used to buy or sell goods or services. Interestingly, it is to be noted that tokens can be bought with the help of cryptocurrency coins, but the coins cannot be bought by using tokens. Now, as one has understood the basic difference between a cryptocurrency coin and token it would become easier for them not to get misguided or misled in the cryptocurrency world.

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4 Comments

4 Comments

  1. Pingback: The difference between a cryptocurrency coin and a protocol token – The Coinage Times

  2. Pingback: The difference between a cryptocurrency coin and a protocol token – Btc News Magazine

  3. Raymond j braydi

    July 1, 2018 at 9:21 am

    Protocol token is shaken as of now because of the disappearance of the rule of law dirty powerful media outlets for the love of money and the fear from the opposition left party that the media is a major player in it when my words on tweeter and other media outlets started to form major threats especially to previous president Obama,the Clinton,C N N & and the hole gang of the one world government advocates.I was threatened publicly on tweeter,hacked severely invading my privacy my network cellphones emails ext followed by several cars then physical treat by two persons and a trained black dog was released on me to scare me then I was attached and hurt seriously and my car back window was broken and my Android cellphone was taken even I feel cell providers are assisting as well and finally my network was completely cleaned up from tokens and was transferred to P pumapay total supply 78042956829 Tokens raised $117019041…it’s has been for couple of years struggling knowing that money was collected because of the unlimited leads generated by my network using closed bank accounts lost cellphone numbers assistance by some google affiliates group and more this is the end of it where is the rule of law??? I want the federal bureau of investigations to open investigations to investigate everything before its to late …
    Thanks

  4. Pingback: What is NEM? NEM price prediction for 2018. – Cryptocurrencies World News

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Best Tools to track Cryptocurrency Markets: CryptoCompare, CoinMarketApp, CoinGecko

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There are different websites and mobile applications designed to keep the track of cryptocurrency market, we cover the Top 3 of these.

The cryptocurrency market includes the prices and market capitalizations of different Cryptocurrencies like Bitcoin, Ethereum, Stellar and many others. Currently, there are thousands of cryptocurrencies, markets are 16084 and market capitalization is about $124,123,711,224.

 

There are different websites and mobile applications designed to keep the track of cryptocurrency market, we cover the Top 3 of these:

 

CryptoCompare.com

Known for its high-end API and real-time tick data, CryptoCompare has been serving the cryptocurrency space from 2014.

Founders: Charles Hayter & Vlad Cealicu

CryptoCompare shows real-time data for more than 5300 Coins and 240k trading pairs, enough for an entire overview of the market. Users can see live Order books, historical data, reports, social data and reviews on all cryptocurrencies. The website is very easy to use and is free for everyone.

 

CoinGecko.com

We love CoinGecko because it focuses on tracking community growth, events hosted by teams and open-source code development apart from the usual price tracking, market capitalization and volume traded. It was also founded in 2014.

Founders: TM Lee, Bobby Ong & others

CoinGecko’s team is very dynamic and is very active on social media like Twitter, Telegram & Facebook. They cover more than 260 exchanges with live data and have more than 3300 cryptocurrencies. They are free for everyone to use.

 

CoinMarketApp (Mobile Application)

When it comes to easily track the live prices and your portfolio on your mobile, CoinMarketApp is the preferred choice for most. With live alerts on more than 1400 Cryptocurrencies, the app saves your time and alerts you on every move.

Download on Android

Download on iOS

Apart from cryptocurrency prices, the app lets you manage your portfolio, mining pools, new contracts and the latest news from the crypto industry.

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Altcoins

Cryptocurrency Market Updates: Bitcoin May fall further

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The cryptocurrency market is still facing the same bullish trend today, yet again. Bitcoin price recovered a little with trading around $4300 to $4400.

The cryptocurrency market is still facing the same bullish trend today, yet again. Bitcoin price recovered a little with trading around $4300 to $4400. Yesterday the price of bitcoin fell up to $4190. Ethereum is still trading at a year and a half low of $125. Apart from ethereum, most altcoins are showing small corrections. Bitcoin Cash moved 3% upwards while Monero has moved 4% upwards in the last 24 hours. Bitcoin Gold and Bitcoin Diamond have had good gains for the day with 8% and 16% rise. IOTA is trading at around $0.32 which shows a 6% improvement from yesterday’s price. NEO is up by 5%. However, the small gains are nothing in front of the massive downtrend these altcoins went through in the past couple of days.

 

Cryptocurrency Market Capitalization Improved

The total cryptocurrency market cap yesterday came down up to $136 billion which was the lowest of 2018. In the last 24 hours, cryptocurrency market has managed to add $4 billion in the market capitalization adding to $140 billion. Over the last week, the cryptocurrency market had lost over $40 billion and over the last month, around $70 billion have been erased from the cryptocurrency market capitalization which is yet to be recovered.

 

Bearish predictions for bitcoin

While the market cap is trying to recover the price predictions for bitcoin still remain bearish as many cryptocurrency analysts have predicted that the only support after the current significant support of $4000 is at $3000. So if the price drops below $4000, it will definitely reach down to $3000 after which the price is expected to recover.

 

The overall situation of the market is still harsh as there is no major recovery from the massive losses that occurred in the past few days. What do you think about the bitcoin predictions being made by crypto analysts? Tell us in the comments section below.

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Bitcoin Cash Hard fork screwed the whole cryptocurrency market

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Whole cryptocurrency market is suffering because of the continues wars going on between ABC and SV which has created a bad reputation of the crypto space.

The original Bitcoin Cash split into Bitcoin ABC and Bitcoin SV during the hard fork but no one is sure to weather BCHSV or BCHABC will survive in the market as the hash wars still continue. The hard fork has lead to an uncertain future of Bitcoin Cash and also screwed the whole cryptocurrency market. The Price of both the new coins is on a continues decrease where Bitcoin Cash ABC values at around $226 and Bitcoin Cash SV values at around $76.

 

Cryptocurrency Market Crash

The whole cryptocurrency market is suffering because of the continues wars going on between the two teams which have created a bad reputation of the crypto space to the newbies. At this time when more and more institutional investors were entering into the cryptocurrency space, the hard fork has created a feeling of Fear, Uncertainty and Doubt amongst them.

 

BTCUSD yearly chart

BTCUSD yearly chart

 

As the hard fork started, the entire cryptocurrency market faced a downfall where all major cryptos are on a 6 month low with bitcoin trading around $5200 that is a yearly low for the most dominant cryptocurrency. The decline is the price has created fear in the minds of investors who are now talking about capitulation.

 

Should Craig Wright be blamed?

Craig Wright who claims to be the real Satoshi Nakamoto and the founder of the original bitcoin has been funding his side of the war using BTC. Cryptocurrency enthusiasts around the world are criticizing Craig Wright and also calling him a lier.

 

 

The local media’s role

The real reason behind the rise of cryptocurrency and blockchain was the mass adoption by people who heard about it through local media. At that time, the local media described bitcoin and other cryptocurrencies as the future of money explaining the decentralized nature of such currencies, but now due to the wars within the cryptocurrency ecosystem, the local media has started to criticize cryptos and people have started to lose faith in the crypto market.

If the amount of money being used in such hash wars would have instead been used for the development of the crypto ecosystem with advancements such as lightning network, the market could still be flourishing rather than being on the verge of getting sunk.

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