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Blockchain Glossary

Glossary

Token

An asset whose ledger is a smart contract on a blockchain, as opposed to the chain's native asset. Most tokens are fungible (ERC-20-like) or non-fungible (NFTs).

A token is an asset whose accounting lives in a smart contract, not in the base protocol. The chain's native asset (ETH, BTC, SOL) has its balances tracked by the consensus rules; everything else that looks like "a coin" — USDC, UNI, an NFT — is really entries in some contract's storage.

Fungible tokens follow standards like ERC-20; non-fungible tokens follow ERC-721 or ERC-1155. Because each token is just a contract, issuing one is permissionless — which is both the entire point and the reason most tokens are worthless.