Crypto Tokens, Coins and Mnemonics
Today I learned to simply explain the difference between a crypto token, coin and a mnemonic.
The term Token describes all cryptocurrencies apart from Bitcoin and Ether(eum), although these are also tokens in principle. In the second meaning, it describes certain digital crypto-assets that are built on top of another cryptocurrency blockchain like DeFi Tokens, Non-Fungible Tokens (NFTs), Governance Tokens or Security Tokens.
A crypto coin is the native coin of a blockchain like Bitcoin or Ether, which is then used to trade currency or store value.
Altcoin means any cryptocurrency that is not Bitcoin. Since Bitcoin has always dominated the entire cryptocurrency market, it also dominates the discussion about cryptocurrencies and therefore any other coin is called an altcoin. It was also the first cryptocurrency to be issued, and it introduced the concepts of blockchain and cryptocurrency.
A stablecoin is a cryptocurrency where the value of each coin is tied to an external asset such as USD or EUR. To be correct, each stablecoin is also an altcoin. Thus, the value of a stablecoin can be pegged to any asset. Because of the fixation of one asset to another means that both values are always in the same relationship.
A Secret Recovery Phrase, mnemonic phrase, or Seed Phrase is a set of typically either 12 or 24 words, basically a group of easy to remember words. These words are pulled from a specific list of 2048 words known as the BIP39 wordlist. It serves as a backup to recover your wallet and coins in the event your wallet becomes compromised, lost, or destroyed.