What are Crypto Tokens?

You have heard people talk about cryptocurrencies, altcoins and crypto token and you are confused. Or you think they all mean the same thing. No, cryptocurrencies, altcoins and crypto tokens are different although related in some way.

Crypto tokens are tradable or interchangeable utility or assets on a blockchain. We can say cryptocurrency is an umbrella for both altcoins and crypto tokens, i.e. crypto tokens and altcoins are subsets of cryptocurrency superset. Cryptocurrency is a way of paying and receiving payments only just like bitcoin(it's a cryptocurrency). Altcoins on the other hand are cryptocurrencies that found their way into the market after the glory of bitcoin. They are created to solve the limitations of bitcoin with some modifications.

Talking about crypto tokens, they are cryptocurrencies with particular functions, they serve as utility or assets. They have their own dedicated blockchain and are used for carrying out smart contracts or building decentralised applications. So crypto tokens are payments enabling cryptocurrencies on a blockchain. But altcoins and cryptocurrencies only serve as a means of making and accepting payments outside a blockchain.

On a final note, crypto tokens raise funds for projects through crowdfunding and the tokens are created, distributed and sold through Initial Coin Offerings.

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