Status
Archived

evo

Site Admin
Joined
Apr 2017
ICO  ( Initial Coin Offering ) is a term created to describe the many bitcoin clones and other “coin” clones that erupted over the years. Bitcoin is basically a distributed ledger that performs best as digital money  -  a simple example of the power of decentralization. Satoshi Nakamoto’s consensus process is revolutionary! But you can’t build much with it. Ethereum can do what Bitcoin does. It can be digital money too, but unlike Bitcoin, Ethereum is highly programmable  -  it’s designed to accommodate the construction of complex applications. Bitcoin produces “coins”. Ethereum generates “tokens”. A “Token Launch” is an Ethereum thing. An “ICO” is a Bitcoin/altcoin thing.

Coins really only have one utility  - to act as simple stores of value with limited-to-no other functionality. By “simple” value, I mean value not represented or manifested through a variety of dynamic functions. Tokens are a completely different breed all together. They can store complex, multi-faceted levels of value. Forget everything you know about Bitcoin and pre-mined coins and that entire ilk of tech, Ethereum tokens are generated by a Smart Contract System (SCS), are highly programmable and have multi-functionality because of it. They transcend being just a coin, and through their array of functions become something much more  -  “tokens”. Technically, they are not “offered”, they are “generated”. Probably the most accurate phrase of what’s going on during an Ethereum token launch is to describe it as a “Token Generation Event”, but I’m not sure TGE has the same flare as ICO.

Nevertheless, a coin does one thing, and a token can do many things.
 
Joined
May 2020
From
New York
The coins are cryptocurrencies created on their own blockchain and tokens are cryptocurrencies to but with the difference that they were created on the blockchain of another coin.
 
Joined
Aug 2020
From
Hungary
But why does coins have higher value than tokens?

Probably because coins were here first, and they are considered more trustworthy and less volatile than tokens, plus a higher percentage of them are listed on bigger exchanges than in the case of tokens. This makes them easier to access and more popular. Also there is a category of coins called stablecoins, which are backed by fiat money, another crypto or algorhytms and are therefore less volatile.
 
Status
Archived

Similar Threads

Top