Types of Cryptocurrency: Coins, Tokens & More
From Bitcoin to stablecoins to DeFi tokens, know the categories before you invest.
Introduction
Cryptocurrency isn’t just Bitcoin. Thousands of digital assets exist, but they fall into a few clear categories. Knowing the types helps you avoid hype and build with clarity.
Coins
Definition: Coins have their own blockchain (e.g., Bitcoin, Ethereum, Solana).
Purpose: Usually serve as money, security, or “fuel” for their network.
Examples: BTC, ETH, SOL, ADA.
Tokens
Definition: Built on top of other blockchains (often Ethereum as ERC-20 tokens).
Purpose: Provide utility or governance in a project.
Examples: UNI (Uniswap), LINK (Chainlink), AAVE (Aave).
Stablecoins
Definition: Pegged to stable assets like USD or gold.
Purpose: Reduce volatility, enable payments, power DeFi.
Examples: USDC, USDT, DAI.
DeFi & Utility Tokens
DeFi Tokens: Power decentralized finance protocols (UNI, AAVE, COMP).
Utility Tokens: Provide access or perks in ecosystems (BNB, MATIC).
Governance Tokens: Give holders voting rights in DAOs.
Other Types
NFTs: Non-fungible tokens, unique digital assets.
Privacy Coins: Enhance anonymity (XMR, ZEC).
Meme Coins: Community-driven, often speculative (DOGE, SHIB).
Real World Asset (RWA) Tokens: Represent physical assets like real estate or treasury bills.
FAQs
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A: Coins run on their own blockchain. Tokens are built on another blockchain.
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A: They reduce volatility but still carry risks like depegging or regulatory changes.
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A: High risk, often hype-driven. Discipline means knowing the difference between speculation and strategy.
Not all crypto is created equal. Understanding the types keeps you disciplined, not distracted.
Inside the C3 Vault, you’ll learn how to build balanced allocations across coins, tokens, and stable assets.