Crypto tokens are a way different from cryptocurrency as cryptocurrencies are holding their own blockchain networks and on the other hand crypto tokens are build on any existing blockchain.
There is a general confusion between crypto tokens and cryptocurrencies; where Tether which is a crypto token is based on open blockchain technology’s top. These are confused to be one, as both of them are digital assets. But the basic difference between the two lies with the blockchain network; Cryptocurrencies as explained have their own blockchain, while crypto tokens are based on existing blockchain.
Amongst various crypto tokens; there are some famous one which one should be aware of before planning to invest in crypto:
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Tether
This is such type of a token which is based on top of the open blockchain technologies. It is so cause it eases the security and transparency which is provided by the open blockchain network. This is a stable coin and is responsible for conversion of cash into digital currency and for your awareness stablecoin is connected with an asset where most likely it is U.S. dollar which aren’t volatile.
U.S. Dollar Coin
Popularly named as USDC is a stablecoin which is based on Ethereum and it, as a token was launched in 2018 which had become popular amongst traders and investors. This is so cause it’s being moved round different cryptocurrency exchanges.
Uniswap (UNI)
This is again one of the famous crypto token as it is able to facilitate automated trading of the DeFi tokens. As per to the data received from the website, it ensures that it does not include intermediaries and not required forms of rent extraction, thereby it is into fast and efficient trading.
Binance
Popularly known as USD is 1:1 backed stablecoin and is providing approval from the New York State Department Of Financial Services. This token is being used in wallets as well as exchanges and also has an added advantage of being used as collateral and loan assets.
Wrapped Bitcoin
This is an effective digital token version of Bitcoin, but Ethereum blockchain is responsible for its running. Prices are also based on that of Bitcoin, so it’s being backed by Bitcoin every time at 1:1 ratio. Here liquidity is freely transferred between Bitcoin and Ethereum by the traders. Such a transfer is allowed by Wrapped Bitcoin in self controlled manner and in decentralised way.
Crux
With the aid of above information you can effectively invest or trade in any of these popular tokens as per to the benefit attached with each according to investors requirement. Also it is clear now that cryptocurrencies are different from crypto tokens.
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