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Wednesday, September 16, 2020

THIS IS THE DIFFERENCE BETWEEN TOKENS AND COINS IN CRYPTOCURRENCIES

 
 
 

   The term in cryptocurrency is divided into two, namely token and coin. These two things are often assumed to be the same. But, did you know the two have a very clear difference?


The most fundamental difference is regarding the definition, creation, purpose and usability of both up to the types of tokens. The following are the fundamental differences between tokens and coins that need to be known.

Definition of Coin and Token
Coin is a digital asset that runs on its own blockchain, for example Bitcoin working on the Bitcoin or Ether blockchain working on the Ethereum blockchain. Meanwhile, tokens are digital assets issued by a project that can be used for payment in order to enjoy the services provided by the project. Tokens are generally hosted on other blockchains such as Ethereum or Waves.

Coin and Token Creation 
Coins are made through the process of mining or mining with proof of work or Proof of Stake mechanism. Coins are generated after miners perform certain processes within the coin blockchain and if successful will generate coins in return. While tokens are created created in decentralized applications (dApps) hosted by blockchains that work on smart contracts, such as Ethereum. 

By funding smart contracts with the blockchain's original coins, users receive an allocated number of tokens, which in turn, allows the user to interact with dApp. DApp who receives coins in exchange for tokens will then develop their services by using those tokens as part of the project to be created. Tokens often represent several forms of value to use in a project. 
 

Purpose and Usability

 

Coin aims as a unit for value storage or to make transactions. It can also be used as a storage value that can be stored and then exchanged for something useful Token usually aims as an exchange tool to run a service from a project that provides tokens. Tokens can also serve as digital assets until presenting an ownership.

Examples of token usage can be seen in a project to be released later this year named Filecoin. The project provides decentralized data storage services, where to enjoy the service the user must have a Filecoin or FILT toek that will be used as a reward for the service providers or miners in the project.

Token Type 

 

There are four different types of tokens according to the definition of Swiss financial regulator FINMA. The four types of tokens are as follows:

Utility Tokens: Utility tokens are used to gain access to certain parts of a project, such as specific services or product offerings. Due to its limited supply, utility tokens are often expected to increase in value.

Payment Tokens: Similar to how coins work, but more specific in their use, payment tokens have the only payment usage for services or goods.

Security/Asset Tokens: These are tokens issued by the initial token sale (ITS) or ICO, where people will invest their money with the aim of making a profit.

Equity Tokens: This is an unusual form of token at the moment, but an equity token is one that represents an equity or a stake in the company.

Tokens to Note 

As previously described tokens can serve as an exchange tool to use a service. One of the tokens to note and launch is the long-awaited FILT Token. This is a token that works on the Filecoin network which is a decentralized data storage service using the IPFS protocol already used by the world's major industry names. 

Filecoin is a project created by Procol Labs that is already famous for its peer to peer technology, in 2017 only Filecoin managed to become the largest initial funding project or ICO by raising $257 million from major world investors such as Winklevoss Capital, Coinbase to Skype. 

Currently Filecoin is still in the development process predicted to launch mainnet by the end of 2020. While the token is FILT is entering the pre-order stage with the process of ordering FILT2 tokens first which will be exchanged to FILT tokens when officially listing on the exchange. 
 

Buying FILT2 

 

You can buy this FILT2 token at Blotocol OU, here the price of one token is priced at $12.8, and in Indonesia there is a special one because the minimum purchase is 10 tokens. This amount is less than japanese users who have to buy a minimum of 100 tokens. So for Indonesians who want to get this token simply provide $128, and can already get the token. Once you purchase the token, the FILT2 token will be locked first and will be redeemed to the FIL token after 6 months of the token listing. This means that before the FILT token is published, you already have a FILT token first.  


Buy a FILT2 token now which will be exchanged to FILT, then you will get the base price of the token that will work on that Filecoin network.  Then when filecoin is officially released and the ecosystem continues to be frayed and adopted by many people, it is predicted that fil prices listing on the exchange can increase and this will benefit you, since previously you only bought those tokens at the initial price that have not been affected by market conditions.  By purchasing a FILT2 token that will later be converted into FILT, you can use it to take advantage of Filecoin's secure and decentralized data storage services.  



 

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