What you should know about Coin and Token #001
Hello crypto friends,
I believe you are all doing perfectly fine and are enjoying your blogging on steemit.
Today us another day and we shall discuss on another cryptocurrency topic.
We have been hearing about coins and tokens and probably we have been wondering if they are the same and why they are given different names, well your answers are not far-fetched as I shall be providing answers to your questions now.
As it it known tokens and coins are units of cryptocurrency, that is they are used to store value but today we shall be examining some interesting points and coin and token.
WHAT IS COIN
A coin can be explained to be a digital entity that stores values l and it is classified as a cryptocurrency.
A coin is a cryptocurrency that is built on its own blockchain and not the blockchain of another coin.
In other words, we can explain a coin to be a native digital assets of a blockchain.
TYPES OF COIN
There are different types of coins available in the cryptospace and some of them are ;
- STABLE COINS:
As the name implies, a stablecoin is a cryptocurrency asset that is not vulnerable to price volatility.
The cryptomarket is very volatile and this means that it's moves high and lows in a short period of time and all cryptocurrency are subject to this volatility except the stablecoin.
A stablecoin is usually pegged to a dollar, as thus it carries and maintains the value of a dollar.
A good example of a stablecoin is USDT, USDC, BUSD etc.
- NATIVE COINS:
A native coin as the name implies is a coin that operates on its own blockchain.
Coins that operates on their blockchain is usually known as a native coin and a good example is bitcoin.
Bitcoin can be considered a native coin because it operates on its own blockchain, and as such, it is the native coin of it's blockchain.
- FORKED COIN:
A forked coin can be explained to be a coin that was derived from an existing blockchain.
A fork can be explained to be an activity that occurs when there's a change of rule in the running of a blockchain which further leads to the design of a new blockchain alongside it's native coin.
This coin that is produced from a forked blockchain is known as a forked coin.
A good example of a forked coin is HIVE, it was forked from steemit blockchain.
- WRAPPED COIN
A wrapped coin can be explained to be a type of cryptocurrency that represents another cryptocurrency of a blockchain
The process of coin wrapping often involves the locking of a coin in it's blockchain and designing an corresponding coin on a different blockchain.
CONCLUSION
We have discussed about a coin and it's types.
In our next meeting, we shall learn a lot about tokens and then we shall consider their similarities and differences.
Thank you for going through my blog 😊
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