is there any difference between coin, token and protocol?
this is what i understood in ethereum perspective
ethereum is a protocol , ERC20 is a token , ETH is a coin
is it correct ?
1
votes
You should ask this on bitcoin.stackexchange.com
- Vadim Kotov
I'm voting to close this question as off-topic because it is not related to progamming
- Vadim Kotov
This is related to block chain n crypto currency , I mean this is the base of blockchain and ethereum
- sravan ganji
This is a valid question related to blockchain. In fact, all the distributed applications running on blockchain use some sort of tokens and having the understanding of the distinction helps. Probably, a more relevant site could be ethereum.stackexchange.com, but it deserves to be answered in this forum as well.
- Gopal
2 Answers
3
votes
is there any difference between coin, token and protocol?
Yes.
A protocol is a set of rules that define interaction between entities (TCP/IP defines how computers interact, diplomatic protocol defines how countries interact)
The difference between coin and token is not that obvious though.
A coin (in this context) is something you can send in the blockchain network. I think it's a value 'natively' supported on this network, like ETH or BTC.
A token is related to ERC20 contracts, and you can think of it as a portion of something that the contract gives you (in exchange for ETH for example). In a case of ICO it's a share of future earnings, or the company can promise to replace tokens with real shares after their IPO.
ethereum is a protocol
No. Ethereum is a network of nodes acting accordingly to Ethereum Wire Protocol
ERC20 is a token
No. It's a standard for contracts which main goal is to distribute tokens (also you can call it an interface). It's used because many exchanges could almost "automatically" add your tokens if you implement it with ERC20. They can do it, because it defines the method of transfering tokens between addresses:
transfer(address _to, uint256 _value) returns (bool success)
Among other useful methods.
ETH is a coin
Yes!
1
votes
In short we can say Coin is a kind of cryptocurrency which interact with blockchain directly by using set of protocols.
Tokens are basically other kind of cryptocurrency which interact with Blockchain using Smart Contracts.
Ethereum provides concept of Tokens and Smart Contracts which can be written in Solidity only.
Also NEO blockchain launching their Smart Contracts that can be written in Java, .NET, Python and some other languages.
