EON: a coin or a token?

Generally, crypto assets may be divided into several categories. Among them, there are coins and tokens. While the difference between these two is not obvious, some may experience difficulties in defining what EON is. The below explanations are aimed at providing an answer to this question.

Coins

Coins (or altcoins, or alternative cryptocurrency coins) mostly refer to coins alternative to Bitcoin (BTC). BTC is the first decentralized well-known cryptocurrency powered by blockchain. Some coins may be considered as a variant of Bitcoin (or a fork) because they are built upon a slightly changed open-source Bitcoin protocol. Thus, an entirely new coin is created, with a different set of features.

Not only Bitcoin forks may be considered as coins. Instead, there are some coins built upon their own blockchain, like Ethereum, Omni, Nxt.

Usually, coins are used as money but some of them have other uses such as to fuel applications, to fuel smart contracts and token transactions, or to validate transaction on a network.

A common issue with all coins (altcoins) is that they possess their own blockchain where transactions with their own native coins occur in.

Tokens

Tokens, in their turn, represent a special asset or utility on top of a blockchain. Moreover, tokens may represent any asset that is tradeable, from commodities to coupons, or even other cryptocurrencies.

Creating tokens is much simpler because:

  • A blockchain does not have to be created from scratch;
  • There is no need to modify the code of a protocol.

Tokens are created and distributed to the public through Initial Coin Offerings (ICOs), similar to Initial Public Offerings (IPOs) for stocks.

Most tokens are used with decentralized applications. Once created, tokens are often used to activate features of an application they were designed for.

EON

A token for the following reasons: