Tokens on Cardano
You Will Learn
- •What Cardano native tokens are and how they differ from other blockchains
- •What a Policy ID is and why it matters
- •Difference between fungible tokens and NFTs
- •Understanding token metadata (CIP-68 standard)
Cardano Native Tokens
Cardano has a unique approach to tokens that sets it apart from other blockchains. Instead of requiring smart contracts to create tokens (like Ethereum's ERC-20 standard), Cardano has native token support built directly into the blockchain protocol.
What Makes Native Tokens Special:
- • First-class citizens: Tokens are treated the same as ADA by the blockchain
- • No smart contracts needed: Create tokens without coding complex contracts
- • Same security as ADA: Tokens inherit all of Cardano's security guarantees
- • Lower fees: No expensive smart contract execution costs
- • Deterministic: Token behavior is predictable and well-defined
When you receive Charme tokens for your physical Fruit Seller Tarot deck, you're receiving a Cardano native token. It can be sent, received, and stored just like ADA, but with its own unique properties and purpose.
Policy IDs: Token Fingerprints
Every token type on Cardano has a unique Policy ID—a 56-character hexadecimal string that identifies it. Think of it as a fingerprint or serial number for token types.
Example Policy ID (Charme token):
6825f80a33afc17f92b98eb394e4c4fa155fbbee4936fdeb9828a665Why Policy IDs Matter:
✅ Authenticity Verification
When you receive a token, you can verify its Policy ID matches the authentic version. This prevents scammers from creating fake tokens with similar names.
✅ Unique Identification
Multiple tokens can have the same name, but each has a unique Policy ID. Always check the Policy ID, not just the name!
✅ Tracking & Transparency
You can look up any Policy ID on block explorers to see all tokens of that type, total supply, and transaction history.
Fungible vs Non-Fungible Tokens
Tokens on Cardano come in two main types: fungible and non-fungible. Understanding the difference is crucial for working with blockchain assets.
💰 Fungible Tokens
Interchangeable and identical - Every token is exactly the same as every other token of that type.
- • Examples: ADA, Charme authentication token, USDC
- • Use case: Currency, utility tokens, points
- • Value: All tokens have equal value
- • Divisibility: Can often be divided (e.g., 0.5 ADA)
Think of fungible tokens like dollar bills—one $5 bill is worth the same as any other $5 bill.
🎨 Non-Fungible Tokens (NFTs)
Unique and one-of-a-kind - Each token has distinct properties and cannot be swapped 1:1 with another.
- • Examples: Tarot card NFTs, digital art, collectibles
- • Use case: Art, gaming items, certificates, deeds
- • Value: Each token has individual value
- • Divisibility: Typically not divisible (you own 1 NFT or 0)
Think of NFTs like trading cards—each card is unique with different rarity, artwork, and value.
Fruit Seller Tarot Example: Your Charme authentication token is fungible (all Charme tokens are equal and simply prove deck ownership). However, when we release the 78-card NFT collection, those will be non-fungible—each tarot card NFT will be unique to your specific deck.
Token Metadata (CIP-68)
Tokens can carry metadata—additional information like names, images, descriptions, and custom properties. On Cardano, the CIP-68 standard defines how rich metadata should be structured for NFTs.
What Metadata Includes:
- 📝Name & Description: Human-readable token name and detailed description
- 🖼️Image/Media: Links to artwork, 3D models, videos, or other media files
- 🏷️Attributes: Custom properties (e.g., card suit, rarity, power level)
- 👤Creator Info: Artist name, website, social links
- 📜Rights & Licensing: Copyright information, usage terms
How Metadata is Stored:
Metadata isn't stored directly on the blockchain (that would be expensive!). Instead, the blockchain stores a reference pointer to where the metadata lives:
IPFS - Decentralized storage network (most common)
Iagon - Cardano-native decentralized storage (TFST will use this!)
Arweave - Permanent storage blockchain
When your wallet displays an NFT with artwork, it's reading the metadata reference from the blockchain, then fetching the image from decentralized storage.
Viewing Tokens in Your Wallet
Cardano wallets like Vespr automatically display all your tokens—both ADA and native tokens—in a single view.
What You'll See:
- • Token name (pulled from metadata)
- • Quantity you own
- • Token icon/image (for NFTs)
- • Policy ID (usually visible in token details)
- • Transaction history for that token
When you claim your Charme token on mainnet (covered in our /claim-token flow), you'll see it appear in Vespr alongside your ADA. You can then verify the Policy ID to ensure it's the authentic token.
Token Security Tips
⚠️ Always Verify Policy IDs
Scammers create fake tokens with similar names. Always verify the Policy ID from an official source before trusting a token.
⚠️ Be Cautious of Airdrops
If you receive tokens you didn't request, research carefully before interacting. Some airdrops are legitimate, others are scams or spam.
⚠️ Check Token Details
Before buying or accepting tokens, look them up on block explorers to see total supply, distribution, and project information.
Common Questions
What is a Cardano native token?
Cardano native tokens are custom tokens built directly into the Cardano blockchain, without needing smart contracts. Your Charme token is a native token. Unlike tokens on other blockchains, native tokens benefit from Cardano's security and lower fees, and can be sent/received just like ADA.
What is a fungible token?
A fungible token is interchangeable — every token is identical and has the same value. Your Charme authentication token is fungible, meaning all Charme tokens are equal and simply prove you own a deck. Think of them like currency: one dollar bill is the same as any other dollar bill.
What is an NFT?
NFT stands for Non-Fungible Token — a unique digital asset that cannot be replaced or exchanged 1:1. Each NFT is one-of-a-kind with its own distinct properties. The 78-card tarot NFT collection (planned for future release) will be NFTs, where each card is unique to your deck.
What is a CIP?
CIP stands for Cardano Improvement Proposal. These are community-driven standards that define how different parts of the Cardano blockchain work. Think of them as agreed-upon rules that ensure everything on Cardano works together seamlessly. Learn more at cips.cardano.org.
What is CIP-68?
CIP-68 is a token metadata standard used for NFTs on Cardano. Your Charme token follows this standard, which allows it to carry rich information and be updated over time. This standard ensures your token can interact properly with wallets, explorers, and other Cardano services.
What is CIP-99?
CIP-99 is the QR code authentication standard that makes your physical deck verification possible. When you scan your deck's QR code in Vespr wallet, CIP-99 securely sends your wallet address to our system, which then sends you a Charme token. This standard prevents fraud and ensures only genuine deck holders receive tokens.
✅ Next Steps
You now understand how tokens work on Cardano! This knowledge will be essential when you claim your Charme token and later collect tarot card NFTs.
- Understand native tokens vs smart contract tokens
- Know what Policy IDs are and why they matter
- Recognize the difference between fungible tokens and NFTs
- Understand how metadata works (CIP-68)
Test Your Knowledge
Check your understanding with these questions. This is an honor system—use the reveals to learn at your own pace.