Crypto Glossary

Posted on September 13, 2021 in


In the blockchain world, tokens (also known as crypto tokens) are units of value that blockchain-based companies or projects create on top of existing blockchain networks to represent their worth. Even though they frequently have a high degree of interoperability with the cryptocurrencies on that network, they are a completely separate digital asset class.

What is a token in cryptocurrency?

Generally speaking, a cryptocurrency token refers to a unique virtual currency (token) or the unit of money used to denote cryptocurrencies. These tokens are fungible and tradable assets or services that are decentralized and run on their blockchains. While crypto tokens are frequently used to collect funds for crowd sales, they can also be used in place of other items. Typically, these tokens are produced, distributed, sold, and circulated via the traditional initial coin offering (ICO) procedure, which entails a crowdfunding exercise to support project development.

When it comes to blockchain technology, cryptocurrencies are the native asset of a certain protocol, whereas tokens are produced by platforms that are built on top of such blockchains. For example, the native token of the Ethereum blockchain is called Ether (ETH). While Ether is the cryptocurrency that is native to the Ethereum blockchain, there are a plethora of other tokens that also make use of the same network. A variety of functionalities are available on the platforms for which these tokens are created, including participation in decentralized finance (Defi) processes, accessing platform-specific services, and even engaging in video games.

Tokens vs Coins

Any digital asset produced on the blockchain is referred to as a token. It is often produced or minted on another blockchain, and it is frequently seen with several other tokens that are associated with other projects. Anyone may simply generate a crypto token by writing a bunch of computer code or even by utilizing automated tools to accomplish this task for them.

On the other hand, a coin is a cryptocurrency that runs on its blockchain, as opposed to a token. It is often referred to as the “native token” of the blockchain, and it is frequently used as a means for projects to pay transaction fees while simultaneously developing their apps on the same blockchain infrastructure. Building a blockchain needs a significant amount of human and financial resources (really, lots and lots of money), which means that not everyone capable can create a cryptocurrency. Anyone, on the other hand, may create a crypto token and give it whatever name they like.

Crypto token examples

Non-fungible tokens (NFTs): These tokens are primarily intended to be used as collectibles. Users may generate NFTs for practically anything, including art, baseball, virtual real estate, event tickets, and other types of tickets, among other things. 

Security tokens: Security tokens are digital assets that are used to represent traditional “assets” like stocks and bonds. Consider the case of some security tokens that reflect business shares or bonds that the firm has issued to attract cash from institutional investors. 

Stablecoins: These are crypto tokens that reflect digital equivalents of fiat currencies, such as the U.S. dollar. They are often linked 1:1 to the underlying currency, and as a result, they are always redeemable for the same amount as the underlying currency. USD Coin (USDC), Tether (USDT), and Gemini Dollar are some of the well-known examples.

Asset-backed tokens: In this case, the tokens reflect assets that exist in the real world, such as a piece of real estate or a tokenized form of gold held in a vault. This type of issuance enables the trading of these assets without the need for a physical transfer of the underlying commodity.

Related Articles

A List of 10 Best Fan Tokens & How To Get them

June 06, 2022

A List of 10 Best Fan Tokens & How To Get them

Do you interest football club? Let’s see which fan tokens are the most popular and grab them now before it rockets.

What Is A Wrapped Token & How Does It Work?

May 17, 2022

What Is A Wrapped Token & How Does It Work?

If you’ve been trading crypto, chances are you’ve come across examples of wrapped tokens like wBTC and wETH. Here’s an explanation.

An intro to Enjin: The first gaming token

October 17, 2021

An intro to Enjin: The first gaming token

Enjin (ENJ) is the first gaming token and it has stayed interesting and indeed very special. Click here to learn why!

We offer investors a variety of opportunities in the digital assets industry. Our innovative platform provides access for anyone seeking investment returns anywhere, anytime. Our ecosystem aims at making finance an everyday enriching activity.


The Monetary Authority of Singapore ("MAS") requires us to provide this risk warning to you as a customer of Zipmex.

Before you pay Zipmex any money or DPT, you must be aware of the following.

  1. Zipmex is not currently licensed by MAS to provide DPT services. This means that you will not be able to recover all the money or DPTs you paid to Zipmex if Zipmex’s business fails.
  2. You should not transact in the DPT if you are not familiar with this DPT. This includes how the DPT is created, and how the DPT you intend to transact is transferred or held by Zipmex.
  3. You should be aware that the value of DPTs may fluctuate greatly. You should buy DPTs only if you are prepared to accept the risk of losing all of the money you put into such tokens.
  4. You should be aware that Zipmex may offer services related to DPTs which are promoted as having a stable value, commonly known as “stablecoin”.
  5. DPT held in your Hosted Wallet is not subject to the Singapore Deposit Insurance Scheme (“SDIC”) or any similar insurance or guaranty scheme of any other jurisdiction. In addition, funds stored in your Fiat Wallet do not benefit from the SDIC or any similar insurance or guaranty scheme of any other jurisdiction.

ZipUp+ products have not been approved by the Monetary Authority of Singapore (“MAS”) under the Payment Services Act 2019 and MAS has not reviewed or approved any features of these product offerings. Please review this link for the full terms and conditions and risk disclosure.