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What is Token?
A token is a digital asset created on an existing blockchain (like Ethereum) rather than its own. Tokens can represent utility, governance rights, assets, or even memes.
Full Explanation
In crypto, a "token" refers to a digital asset built on top of another blockchain rather than having its own. For example, USDT (Tether) is a token on Ethereum. Tokens are created using smart contracts (e.g., ERC-20 standard on Ethereum). Types include: utility tokens (access to a service), governance tokens (voting rights), security tokens (represent real-world assets), and meme tokens (community-driven). The distinction between "coin" (native to its chain) and "token" (built on another chain) matters technically.
Example
LINK (Chainlink) and UNI (Uniswap) are ERC-20 tokens on Ethereum. They don't have their own blockchain — they ride on Ethereum's.
Related Terms
Last updated: 2026-03-21
