Coin is a cryptocurrency with its own blockchain, usually created by developers from scratch or by forking. You can also find the term “altcoin”, which implies an alternative coin, that is any coin that is not Bitcoin.
What are the coins?
Bitcoin is the best example of a coin. Bitcoin is not only the world’s first cryptocurrency but also the world’s first blockchain. Since the launch of Bitcoin in 2009, many new blockchains have appeared. The Bitcoin code is open source software, so a number of projects launched completely new blockchains, simply by changing a few technical components of the bitcoin code. Most often, new projects improve scalability, block size, or other technical components. For example, Litecoin appeared this way.
Coin vs Token
How to determine if a cryptocurrency token or coin? The name of the project can sometimes accurately indicate whether it is a coin or a token. For example, Bitcoin (BTC) and Litecoin (LTC) contain the “coin” component in their names and therefore are coins. But for example, Binance Coin (BNB) was actually a digital Ethereum token which then was transferred on its own blockchain. As a rule, the best way to find out if a project is a coin or a token is to look at the project website. It is important to note that even influential projects themselves sometimes use these terms interchangeably.
Most cryptocurrency projects on the market actually begin with the launch of a digital token, not a coin. As a rule, project developers launch test networks from their own block chains before releasing a public cryptocurrency network. Once the project team is ready to launch its core network, it usually conducts a coin exchange. During this event, users can exchange their digital tokens for digital coins that can be used in the new standalone blockchain. So it was with EOS, Tron, VeChain and a number of other projects.
Coin exchange can be done manually or automatically. For example, Binance Exchange, have a function that automatically exchanges digital tokens for coins.