Cryptocurrency Types: A Quick Guide to Coins, Tokens and More

Introduction

Cryptocurrencies come in many forms. While Bitcoin started the movement, today there are multiple categories designed for different uses—from payments to smart contracts and beyond.

Coins vs Tokens

Coins

Coins have their own native blockchain and are primarily used as a medium of exchange or store of value. Examples include Bitcoin (BTC) and Litecoin (LTC).

Tokens

Tokens run on existing blockchains (like Ethereum) and can represent a wide range of assets or rights. Examples include ERC-20 tokens used for DeFi, as well as platform or governance tokens.

By Function

Payments and Everyday Use

Some tokens and coins are optimized for fast, low-cost transfers and merchant acceptance.

Store of Value and Investment Focus

Others aim to act as a digital store of value or a speculative asset.

Smart Contract Platforms

Platform tokens fuel ecosystems that enable programmable rules and apps.

Privacy-Focused and Governance Tokens

Privacy coins emphasize transaction confidentiality; governance tokens give holders voting power in a protocol.

Stablecoins and Asset-Backed Tokens

Stablecoins aim to minimize volatility via fiat reserves, crypto collateral, or algorithmic mechanisms; asset-backed tokens tokenize real-world assets.

Security Tokens

Security tokens represent traditional assets (stocks, bonds) under securities regulation when issued digitally.

How to read crypto classifications

Categories overlap. A token might be a governance token on a smart contract platform and also a stablecoin or privacy-focused depending on design. Always check the specifics of a project.

Conclusion

Understanding these types helps you compare projects by use case, risk and potential for adoption.