A crypto token is a digital asset created on a blockchain. Tokens can represent money-like value, access rights, voting power, collectibles, loyalty points, or claims on another asset.
Token vs coin
A coin usually belongs to its own blockchain, such as BTC on Bitcoin or ETH on Ethereum. A token is usually issued on an existing blockchain using a standard such as a smart contract.
How tokens are used
Tokens are common in DeFi, NFTs, DAOs, stablecoins, and blockchain apps. A token might give access to a service, represent a share of a project, or simply be traded by users.
Before using a token, check what it actually does. Some tokens have practical use, while others are mainly speculative and can lose value quickly.