There are many words and phrases that we use interchangeably that we think mean the same, but are we incorrect?
Want an example?
How about Great Britain and United Kingdom?
Many of us may use these terms interchangeably or not understand their differences. Great Britain refers to a physical island consisting of England, Scotland and Wales whereas United Kingdom to the countries of Great Britain and Northern Ireland.
What about venomous and poisonous?
Poisonous refers to either inhaling, swallowing or absorbing a toxin through the skin. Venomous refers to a toxin being injected into your body typically through a bite or a sting.
What about Coins and Tokens?
Both coins and tokens are cryptocurrencies, but more specifically a coin is a digital asset that operates completely on its own Layer 1 blockchain independent of any other platforms. Examples of this are Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC).
Whereas a token is a cryptocurrency (or digital asset) that relies on another blockchain (Layer 1) other than its own native blockchain (Layer 2). Examples of this are Basic Attention Token (BAT) and the Switch Blockchain’s SWITCH Token. These are also ERC-20 Tokens.
ERC-20 is the standard protocol, or set of rules, for smart contract tokens that use Ethereum as their Layer 1 blockchain. All ERC-20 Tokens are fungible, transferrable and have a fixed supply.