The ERC-20 token standard is a widely adopted Ethereum token standard that defines a set of rules and functions that a token contract must implement. These tokens are fungible, meaning that each token is identical and can be exchanged on a one-to-one basis. This standard has become the foundation for a vast majority of tokens in the Ethereum ecosystem. In this guide, we'll explore the key aspects of the ERC-20 standard.
The term "ERC" stands for Ethereum Request for Comments, and it's followed by a number (in this case, ERC-20). ERCs are a series of proposals and guidelines for the Ethereum blockchain, where each number represents a unique proposal or standard.
The ERC-20 standard defines a set of functions that an Ethereum token contract must implement. These functions ensure interoperability and compatibility between different tokens and platforms.
This function returns the total supply of tokens issued by the contract.
balanceOf(address _owner) returns the balance of tokens owned by a specific address.
transfer(address _to, uint256 _value) allows an address to send tokens to another address. It should decrease the sender's balance and increase the receiver's balance.
allowance(address _owner, address _spender) returns the amount of tokens that the
_spender is allowed to spend on behalf of the
approve(address _spender, uint256 _value) allows the
_owner to approve the
_spender to spend a certain amount of tokens on their behalf.
transferFrom(address _from, address _to, uint256 _value) allows the
_spender to transfer tokens from one address to another if approved by the
ERC-20 tokens also include events that are triggered when certain actions occur. These events can be used to track and monitor token transfers and approvals.
The ERC-20 standard has several advantages:
Interoperability: ERC-20 tokens can be easily integrated into various wallets, exchanges, and applications since they follow a standard set of rules.
Widespread Adoption: The majority of tokens on the Ethereum blockchain, including many initial coin offerings (ICOs), adhere to the ERC-20 standard.
Ease of Development: Developers can quickly create new tokens by following the ERC-20 standard, reducing development time and effort.
The ERC-20 token standard has played a crucial role in the Ethereum ecosystem, providing a foundation for creating and using fungible tokens. Its widespread adoption and ease of integration make it a preferred choice for many token projects. Understanding the ERC-20 standard is essential for both developers and users in the world of decentralized finance (DeFi) and blockchain applications.