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How Coins, Fungible Tokens, and NFTs Differ

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Summary

This introductory explainer distinguishes cryptocurrency coins, tokens, and non-fungible tokens by their roles and whether each unit is interchangeable. It describes coins as assets used for functions such as payment, storing value, and accounting, with ETH as an example of payment for smart contract execution. Tokens can also serve as money, but may additionally represent ownership, identity, or platform rights such as voting.

The comparison emphasizes that coins such as Bitcoin are fungible, while tokens may be fungible or non-fungible. USDT illustrates a fungible token; NFTs are presented as unique assets whose values can differ, with CryptoPunks and NBA Top Shot mentioned as examples. The document offers a basic conceptual overview rather than a technical taxonomy: it does not explain how assets are issued, how blockchains distinguish coins from tokens, or how NFT ownership and valuation work. Its examples are illustrative, and the broad categories can depend on context and platform design.

Key ideas

  • Coins commonly function as money, including as a medium of exchange, store of value, or unit of account.
  • Tokens can serve monetary purposes and also represent rights, identity, or ownership.
  • Fungible units are interchangeable, while each non-fungible token is distinct.
  • The document uses Bitcoin, USDT, ETH, CryptoPunks, and NBA Top Shot to illustrate these distinctions.

Tags

CryptoDeFi

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.