{"id":37687,"date":"2022-08-09T08:31:00","date_gmt":"2022-08-09T05:31:00","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=37687"},"modified":"2025-08-29T20:07:13","modified_gmt":"2025-08-29T17:07:13","slug":"what-are-erc-20-tokens","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/what-are-erc-20-tokens\/","title":{"rendered":"What are ERC-20 tokens?"},"content":{"rendered":"<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">Key facts about ERC-20<\/h2>\n<ul class=\"wp-block-list\">\n<li>ERC-20 is a popular standard for smart contracts on the Ethereum blockchain. It sets the rules to follow when writing a contract that defines the parameters and issuance of a new user token.<\/li>\n<li>The standard greatly simplified the creation of new cryptocurrencies.<\/li>\n<li>Different ERC-20 tokens can be sent and stored at the same address on the Ethereum network.<\/li>\n<li>Letting any developer issue a digital asset without launching a separate blockchain was a turning point in crypto history.<\/li>\n<\/ul>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">What does ERC-20 stand for?<\/h2>\n<p>ERC (Ethereum Request for Comments) is the name of the official protocol for proposing improvements to the Ethereum network. \u201c20\u201d is the ordinal number of the proposal.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">How and when did ERC-20 emerge?<\/h2>\n<p>The proposal to introduce a single standard for user <a href=\"https:\/\/forklog.com\/en\/news\/what-is-a-token\">tokens<\/a> was first <a href=\"https:\/\/eips.ethereum.org\/EIPS\/eip-20\">published<\/a> in November 2015. Its authors were Ethereum\u2019s creator Vitalik Buterin and developer Fabian Vogelsteller.<\/p>\n<p>ERC-20 became the guide for creating fungible tokens\u2014identical tokens that can be exchanged one for another.<\/p>\n<p>Although ERC-20 tokens operate within a framework set by the Ethereum team, that framework is broad enough to give developers significant flexibility.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">Why was the ERC-20 standard needed?<\/h2>\n<p>Bitcoin set the paradigm for other crypto projects: to issue a digital currency, you first had to launch a separate blockchain.<\/p>\n<p>Ethereum broke that rule. With smart contracts, any developer could issue a token and give it useful functions within their application.<\/p>\n<figure class=\"wp-block-image size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/forklog.com\/wp-content\/uploads\/LotR_token-min-1024x819.png\" alt=\"What are ERC-20 tokens?\" class=\"wp-image-156876\" width=\"768\" height=\"614\" srcset=\"https:\/\/forklog.com\/wp-content\/uploads\/LotR_token-min-1024x819.png 1024w, https:\/\/forklog.com\/wp-content\/uploads\/LotR_token-min-300x240.png 300w, https:\/\/forklog.com\/wp-content\/uploads\/LotR_token-min-768x614.png 768w, https:\/\/forklog.com\/wp-content\/uploads\/LotR_token-min.png 1200w\" sizes=\"auto, (max-width: 768px) 100vw, 768px\" \/><\/figure>\n<p>However, before ERC-20 there was a compatibility problem among tokens, as each had a unique smart contract. In other words, for an exchange or wallet to support a token, its creators had to write entirely new code each time.<\/p>\n<p>As the number of tokens grew, support became increasingly problematic and time-consuming. A standard protocol for all tokens was created to solve this.<\/p>\n<p>ERC-20 greatly simplified and unified token issuance within a single network. Along with smart contracts, the standard became a universal way to build and monetise blockchain-based applications. Thus Ethereum became the first blockchain platform in history.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">Which tokens use the ERC-20 standard?<\/h2>\n<p>Many popular cryptocurrencies follow the ERC-20 standard. It is especially widespread in decentralised finance (DeFi) and adjacent fields. ERC-20 is also used for governance tokens in popular crypto projects. Here are just a few examples:<\/p>\n<ul class=\"wp-block-list\">\n<li>Maker (MKR)<\/li>\n<li>Tether (USDT)<\/li>\n<li>Chainlink (LINK)<\/li>\n<li>The Sandbox (SAND)<\/li>\n<li>The Graph (GRT)<\/li>\n<li>Uniswap (UNI)<\/li>\n<li>Axie Infinity (AXS)<\/li>\n<li>Aave (AAVE)<\/li>\n<li>ApeCoin (APE)<\/li>\n<li>Basic Attention Token (BAT)<\/li>\n<li>Compound (COMP)<\/li>\n<li>OMG Network (OMG)<\/li>\n<li>yearn.finance (YFI)<\/li>\n<li>1inch (1INCH)<\/li>\n<li>Enjin Coin (ENJ)<\/li>\n<\/ul>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">Where to store ERC-20 tokens?<\/h2>\n<p>Popular wallets for ERC-20 tokens include MetaMask, Trust Wallet, Exodus and MyEtherWallet. Some wallet interfaces show only the ETH balance, even though an address may also hold ERC-20s. In that case, simply export the address to a wallet with full support for the required asset.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">Where to view ERC-20 transfer details?<\/h2>\n<p>Transaction details for any ERC-20 token can be viewed in an Ethereum block explorer, for example on <a href=\"https:\/\/etherscan.io\/\">Etherscan<\/a>. There, in a <a href=\"https:\/\/etherscan.io\/tokens\">separate section<\/a>, you will also find on-chain data on all assets using this standard. A token\u2019s page shows the number of holders, token distribution by address, and a link to the asset\u2019s smart contract.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">What are the main features of the ERC-20 protocol?<\/h2>\n<p>The standard defines six mandatory and three optional (but recommended) parameters for any smart contract.<\/p>\n<p>Among the mandatory parameters:<\/p>\n<ul class=\"wp-block-list\">\n<li>the function totalSupply, which defines the total token issuance and ensures no new tokens can be created once the maximum is reached;<\/li>\n<li>balanceOf defines the initial number of tokens assigned to a specific address. Usually this is the issuer\u2019s address.<\/li>\n<\/ul>\n<p>The standard also describes two methods for moving tokens. The transfer function handles sending tokens to users, while transferFrom is required for asset transactions.<\/p>\n<p>Two more functions are used to validate the previous transfer methods:<\/p>\n<ul class=\"wp-block-list\">\n<li>approve is used to check that, based on the total supply, a smart contract can distribute tokens;<\/li>\n<li>allowance is required to verify that there is a sufficient balance to send tokens to another address.<\/li>\n<\/ul>\n<p>Optional parameters include the token\u2019s name and ticker, as well as the definition of the maximum number of decimal places (for example, bitcoin has eight such digits\u20141.00000000 BTC).<\/p>\n<p>This small set of easy-to-implement parameters allows a single codebase to interact with any ERC-20 smart contract.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">What are the risks of using ERC-20 tokens?<\/h2>\n<p>Because ERC-20 tokens are effectively smart contracts, they carry certain risks despite their efficiency. For example, a smart contract cannot be changed once deployed. It may also contain bugs and vulnerabilities.<\/p>\n<p>One of the best-known cases was the hack of The DAO, in which $50 million of investors\u2019 cryptocurrency was stolen; the consequences had to be remedied with an Ethereum hard fork.<\/p>\n<p>In rare cases the standard is abused by scammers: they intentionally include parameters in a token\u2019s contract to steal holders\u2019 funds or to run a pump-and-dump scheme.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">Frequently asked questions<\/h2>\n<h3 class=\"wp-block-heading\">What is an ERC-20 wallet?<\/h3>\n<p>This is an application for storing and transacting cryptocurrencies that can handle ERC-20 tokens. Usually, any wallet with declared support for the Ethereum network.<\/p>\n<h3 class=\"wp-block-heading\">What is the difference between ERC-20 and TRC-20?<\/h3>\n<p>ERC-20 is the standard for tokens issued on the Ethereum blockchain, whereas TRC-20 refers to cryptocurrencies created on the Tron blockchain. The best-known TRC-20 token is the Tether (USDT) stablecoin, which is also issued on other blockchains.<\/p>\n<h3 class=\"wp-block-heading\">What is the difference between ERC-20 and BEP-20?<\/h3>\n<p>BEP-20 is the token standard on the BNB Chain (Binance Smart Chain), while only cryptocurrencies on the Ethereum network can have the ERC-20 standard.<\/p>\n<h3 class=\"wp-block-heading\">What is ERC?<\/h3>\n<p>ERC is the abbreviation for Ethereum Request for Comment, a standard for code updates to the Ethereum protocol. Each update has its own ordinal number. ERC-20 was adopted in 2017; it introduced today\u2019s popular token standard on the Ethereum network.<\/p>\n<\/div>\n<div class=\"wp-block-text-wrappers-cards single_card\">\n<h2 class=\"card_label\">What else to read?<\/h2>\n<p>What is Ethereum (ETH)?<\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-are-nfts\">What is an NFT?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-are-custodial-and-non-custodial-crypto-wallets\">What are custodial and non-custodial crypto wallets?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-a-cryptocurrency-airdrop\">What is a cryptocurrency airdrop?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-pump-and-dump\">What is a pump-and-dump?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-decentralised-finance-defi\">What is decentralised finance (DeFi)?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-aave\">What is Aave?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-cosmos-atom\">What is Cosmos?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-solana-sol\">What is Solana?<\/a><\/p>\n<p><a href=\"https:\/\/forklog.com\/en\/news\/what-is-a-dao-decentralised-autonomous-organisation\">What is a decentralised autonomous organisation?<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>ERC-20 is Ethereum\u2019s popular token standard for smart contracts that issue fungible tokens. Its adoption greatly simplified the creation of new cryptocurrencies and marked a turning point. Many leading cryptoassets use ERC-20. Details inside.<\/p>\n","protected":false},"author":1,"featured_media":37688,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"1","_short_excerpt_text":"A concise guide to Ethereum\u2019s ERC-20 token standard and how it works.","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[2113],"tags":[2117,2115,791,46,2126,596],"class_list":["post-37687","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptorium","tag-101-altcoins","tag-101-technical-foundations","tag-erc-20","tag-ethereum","tag-kriptorium-ethereum","tag-tokens"],"aioseo_notices":[],"amp_enabled":true,"views":"142","promo_type":"1","layout_type":"1","short_excerpt":"A concise guide to Ethereum\u2019s ERC-20 token standard and how it works.","is_update":"","_links":{"self":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/37687","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/comments?post=37687"}],"version-history":[{"count":1,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/37687\/revisions"}],"predecessor-version":[{"id":37689,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/37687\/revisions\/37689"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media\/37688"}],"wp:attachment":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media?parent=37687"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/categories?post=37687"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/tags?post=37687"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}