Coin vs token
Also called: coin or token · native coin · crypto token
Definition
A coin is the native asset of its own blockchain, such as BTC or ETH, while a token is an asset created on top of an existing blockchain using a smart contract, such as USDT on Ethereum.
This entry is shown in English.
How Coin vs token works
A coin is built into the protocol of its blockchain. It usually pays transaction fees and rewards miners or validators: BTC on Bitcoin, ETH on Ethereum, SOL on Solana. A token is created by a smart contract that runs on someone else's chain, following a standard such as ERC20 on Ethereum or SPL on Solana.
This difference matters most when you move funds. A token like USDT exists on several chains at once, and each version lives at a different contract. When you withdraw, the exchange asks you to choose a network. The receiving address must support the same network, or the transfer can fail or be lost.
It also matters for fees. To move a token you pay gas in the chain's coin, not in the token. Holding 100 USDT on Ethereum is not enough to send it; you also need a little ETH in the same wallet. In casual speech people mix the two words, and many exchanges simply call everything a coin.
Example
Suppose you hold 300 USDT on the Tron network in a wallet with zero TRX. When you try to send the USDT, the wallet warns that you lack resources for the fee. You buy 20 TRX, send it to the wallet, and the transfer goes through. The same 300 USDT on Arbitrum would need a small amount of ETH on Arbitrum instead, because each token pays fees in its host chain's coin.
Common mistakes
- Choosing a different withdrawal network from the one the receiving exchange or wallet supports.
- Trying to send a token from a wallet that holds none of the chain's native coin for gas.
- Adding a token by name in a wallet without checking the contract address, which is how fake tokens get displayed.
Learn and practise
FAQ
Is USDT a coin or a token?
USDT is a token. Tether issues it on several blockchains, including Ethereum, Tron and Solana, each as a separate contract.
Can a token become a coin?
Yes, some projects start as tokens on Ethereum and later launch their own blockchain, then swap holders into the new native coin in a migration.
Why does my exchange call everything a coin?
It is a simplification for users. On the deposit and withdrawal screens, the network selector shows which chain the asset actually lives on.