🧠 Crypto Coins vs. Tokens: What’s the Difference (and Why It Matters to You)

shethrivesai
Mar 22
2 min read

Updated: Apr 5

Welcome to SheThrivesAI Foundations

You’re smart, capable, and ready to thrive—but let’s be honest, crypto lingo can feel like a secret club you didn’t get the invite to. Today, we’re cracking open one of the most common beginner questions in crypto:

What’s the difference between a coin and a token?(And why should you care?)

By the end of this post, you’ll not only understand it—you’ll own it. Let’s go. 💪

💰 What Is a Crypto Coin?

A crypto coin is a digital currency that runs on its own blockchain. Coins are the lifeblood of their networks—used for transactions, fees, and sometimes staking or governance.

Examples of Coins:

Bitcoin (BTC) – runs on the Bitcoin blockchain
Ethereum (ETH) – runs on the Ethereum blockchain
Litecoin (LTC) – runs on the Litecoin blockchain

🔍 Analogy Time:

Coins are like the official currency of a country.Bitcoin is the U.S. dollar of its blockchain economy.

🪙 What Coins Are Used For:

Sending/receiving money
Paying fees on their blockchain
Storing value (digital gold vibes)
Staking to earn rewards or secure the network

⚠️ But What About Meme Coins?

Meme coins (like Dogecoin or Shiba Inu) are coins too—but built more for fun and hype than long-term value. They’re often:

Extremely volatile
Lacking real utility
Fueled by social media buzz (and sometimes celebrity tweets)

Word to the wise: They’re fun to follow, but not a solid foundation for financial independence.

🧩 What Is a Crypto Token?

A token is a digital asset created on an existing blockchain (like Ethereum). Tokens use that blockchain’s infrastructure but can have very different purposes.

Examples of Tokens:

Uniswap (UNI) – used for governance on the Uniswap platform
USDT (Tether) – a stablecoin tied to the US dollar
AAVE – a governance and utility token on a lending platform

🔍 Analogy Time:

If Ethereum is the operating system, tokens are the apps running on it.

🧠 What Tokens Are Used For:

Unlocking features or perks within a platform (utility tokens)
Voting on project decisions (governance tokens)
Pegging to a stable value (stablecoins)
Representing unique items (NFTs are technically tokens too!)

📊 Quick Comparison: Coin vs. Token

Feature	Coin	Token
Runs on its own chain	✅ Yes (e.g., BTC, ETH)	❌ No, runs on another chain
Main purpose	Currency, store of value	Utility, access, governance
Real-world analogy	National currency	App or store credit
Examples	BTC, ETH, ADA	UNI, USDT, LINK, AAVE

💡 Why This Matters for You

Understanding coins vs. tokens helps you: ✔️ Invest with confidence✔️ Recognize red flags✔️ Ask smarter questions about projects✔️ Avoid hype traps and FOMO mistakes

Knowledge is financial power—and you’ve just unlocked a big piece of it.