A representation of almost anything on the Ethereum blockchain. Managed by a smart contract, a token can represent a cryptocurrency (other than Ethereum's own Ether), a physical item in the real world, an IOU, access rights, an identity, a certification or a collectible (see non-fungible token
ERC-20 (Ethereum Request for Comments-20) are the rules for developing Ethereum tokens. Ethereum initial coin offerings (ICOs) are generally ERC-20 compliant because most digital wallets that support Ethereum's Ether also support ERC-20. Cryptocurrency creators naturally want most digital wallets to handle their tokens.
Following is a summary of token types, which applies equally to Ethereum and non-Ethereum blockchains. See Ethereum
A cryptocurrency with value determined via private trade.
A resource earned or produced such as a storage or CPU token representing resources in a network.
A representation of an asset such as gold, real estate, a car or amount of energy.
Grant access to a digital or physical property, such as a forum, website or hotel room.
Shareholder equity in a digital organization; for example, a DAO or corporation. See DAO
Voting rights in a digital or legal system.
A digital collectible. See non-fungible token
An avatar or legal identity such as a national ID.
Certification by an authority such as a birth certificate or college degree.
Access or pay for a service.
Excerpted from This Excellent Book
The token explanations above were taken from this book and abbreviated. "Mastering Ethereum" is a must-read for every future Ethereum developer. As blockchains are a dynamic subject, terms are used interchangeably, and any particular type of token may be called by several names as well as represent several of these functions.