Stellar assets & contract tokens

There are two types of tokens on Stellar:

1. Stellar assets: a token implementation built into the Stellar protocol itself, enabling efficient execution and therefore very low transaction fees.
2. Contract tokens: tokens implemented using smart contracts, enabling issuers to customize their tokens' functionality.

Freighter supports both token types, but there are some differences users should be aware of.

• The Stellar decentralized exchange (or SDEX) only supports trading of Stellar assets. Freighter's swap feature, as well as applications like StellarX and StellarTerm, use the SDEX for executing trades. Support for other exchanges that support contract tokens within Freighter is coming soon.
• Stellar accounts must add trustlines for an asset before it can receive a transfer of the asset, whereas trustlines are not needed to receive contract tokens. Currently, Freighter users still need to explicitly add tokens to their wallet in order to see their balance, but soon contract token transfers will be detected and displayed automatically.
• Because trustlines are required to receive Stellar assets, this also means that you must hold 0.5 XLM for every Stellar asset held in your wallet. See How much XLM do I need in my wallet? for more information on base reserves. You do not need to hold any XLM in order to receive contract tokens.
• Transactions involving contract tokens generally have higher transaction fees than transactions involving Stellar assets, due the higher computational complexity of executing smart contracts.

You can learn more about the difference between Stellar assets and contract tokens here.