Leaving technicalities aside, a "token" are non-extractable units of digital value that exist as ledger entries in blockchains. Tokens arrived long before the Internet, only recently have they been "rediscovered" and used in a more revolutionary way, and their definition causes confusion. In the world of blockchain technology, a token is a virtual token whose value is issued by an organization. Unlike cryptocurrencies, the use of tokens is very varied they come in many different forms: they can be used as currencies for specific purposes or encode unique data. In contrast, cryptocurrencies cannot be used in any way other than what was initially defined
Generally, the most common means of issuing tokens is via the Ethereum platform. An example is just "ERC-20 token", known to be one of the most widely used tokens in the cryptocurrency world. On this decentralized platform, developers design their applications or contracts on a custom blockchain. Strictly speaking, tokens are not cryptocurrencies like Bitcoin or Ether, but transferable units of value issued on a blockchain.
However, you can distinguish different types of tokens:
Once you understand the position of tokens, it's important to clarify another important question:
What is the crucial difference between tokens and cryptocurrencies?