A standard token issued and traded on the Ethereum platform is an ERC-20 token, or ERC-20 token in English. This sort of token is both fungible (in the sense that its units can be swapped) and programmable (in the sense that the spending criteria are determined at the time of generation).
As a result, the ERC-20 standard is a smart contract standard that allows anyone to design their own Ethereum coin. EIP 20 by Fabian Vogelsteller and Vitalik Buterin, published in 2015, describes it.
What is the significance of the acronym ERC-20? The number 20 originates from the number issued to the proposal when it was established, and ERC stands for Ethereum Request for Comments.
Examples of ERC-20 tokens
In the industry, the ERC 20 standard is the most widely utilized. As a result, many tokens used in initial coin offerings (ICOs) were offered as ERC-20 tokens.
Among the most well-known ERC20 tokens are:
- Thanks to the Brave browser, the Basic Attention Token (BAT), or “basic attention token” in decent French, was utilized to reward the viewing of adverts on the web.
- The Crypto.com Coin (CRO) is a cryptocurrency that is tied to the use of Crypto.com’s payment card and other services.
- The Token of the Chainlink (LINK).
- Loyalty tokens from exchange platforms such as Bitfinex’s Leo Token (LEO), Huobi Token (HT), and OKEx’s OKB.
- Tether USD (USDT), Paxos Standard (PAX), and dai are just a few examples of stablecoins (DAI).
In my guide on how to earn >100$ per month in crypto, I show how to earn BAT tokens in your daily routine.
It’s worth noting that several big cryptocurrencies went through the ERC-20 stage as well: they were first issued as ERC-20 tokens before getting their own blockchain when the mainnet started. In this situation, we can mention the EOS token and the Binance Coin.
Some practical information
How do you know if a token is an ERC-20?
Visit Etherscan, an Ethereum-specific block explorer, to see if a crypto-asset is an ERC-20 token. Then type the name or symbol of the crypto-asset you’re interested in (here I wrote “tether”). Etherscan will inform you which tokens have a name or are about to be listed on a stock exchange, as well as their nature (ERC-20 or other).
Near valid tokens, a little icon indicating that the token has been confirmed by Etherscan will generally show. We can assume that the Uniswap is the token corresponding to the contract with the identification 0x1f9840a85d5aF5bf1D1762F925BDADdC4201F984 if we believe Etherscan.
At https://etherscan.io/tokens, Etherscan also provides a list of major ERC-20 tokens.
Which wallets support ERC-20 tokens?
ERC-20 tokens are supported by the majority of Ethereum wallets, albeit not all of them can manage them directly. The following are the best ERC-20 wallets:
- MetaMask: This web browser plugin allows you to manage all ERC-20 tokens currently in use. It’s also compatible with hardware wallets like the Ledger Nano S, Ledger Nano X, and Trezor Model T.
- The advanced use of ERC-20 tokens and other smart contracts is possible with the MyEtherWallet online interface.
- BRD and Edge are mobile wallets that come pre-loaded with a significant number of ERC-20 tokens and enable for personalized additions.
- The cross-platform wallets Exodus and Jaxx Liberty both manage a large number of ERC-20 coins.
How to create an ERC-20 token?
The ERC-20 token standard is one of the most secure and well-established. If you wish to develop your own Ethereum token, it makes sense to use it.
There are several resources available on the internet to assist you in creating your own ERC-20 coin. Our tutorial on the subject is highly recommended: Create your own Ethereum token.
Technical characteristics
As previously stated, an ERC-20 token is digital money created by a smart contract on the Ethereum network. This contract adheres to the ERC-20 standard, which consists of nine core functions and two events. It’s usually accompanied by three constants that define the token. The contract’s constants are as follows:
- name: the name of the token. Example: Tether USD.
- symbol: the stock symbol of the token. Example: USDT.
- decimals: the number of decimals of the token, by default 18 (like ether).
Are ERC 20 tokens the same as NFT? Have a look at our guide to understanding the difference between crypto and NFT.
The functions are as follows:
- totalSupply: function used to obtain the total quantity of units in circulation.
- balanceOf: function giving the user the balance of units present on an Ethereum account.
- transfer: function allowing an account to send units to another account.
- transferFrom: function that allows units to be sent from one account to another account, without the account using this function being the one that owns the units.
- allowance: function that returns the number of units an account is allowed to withdraw from the contract .
- approve: function that modifies the number of units authorized to be withdrawn from the contract by a given account.
Finally, the basic events are:
- Transfer: triggered by the functions transfer and transferFrom.
- Approval: triggered by the function approve.
Of course, developers can base themselves on this standard and add functions and events to it in order to create their personalized token.
What Is An ERC20 Token? Summary
- A standard token issued and traded on the Ethereum platform is an ERC-20 token or ERC-20 token in English.
- Some practical information How do you know if a token is an ERC-20?
- Visit Etherscan, an Ethereum-specific block explorer, to see if a crypto-asset is an ERC-20 token.
- Near valid tokens, a little icon indicating that the token has been confirmed by Etherscan will generally show.
- The ERC-20 token standard is one of the most secure and well-established.
- Our tutorial on the subject is highly recommended: Create your own Ethereum token.
- As previously stated, an ERC-20 token is digital money created by a smart contract on the Ethereum network.
