what are erc20 token?
what are erc20 token?
Ethereum is a popular blockchain network designed to allow any developer to encrypt any decentralized application and run it in Blockchain.


One of Ethereum’s most important goals is to create an ecosystem that connects everything seamlessly, creating their vision of a “world computer”. It is not only about the network, the blockchain and the applications, but also about the tokens necessary for the operation of the whole ecosystem. Since its inception in 2014, Ethereum has strived to achieve this goal, and one of the key innovations it has introduced is ERC-20 tokens, which can now be created as part of the Ethereum ecosystem. In fact, many other tokens have already been added to the Ethereum ecosystem.

ERC-20 token developers expand their capabilities

It defines the general rules that all Ethereum tokens must follow, letting developers and others, including other smart contracts on the Ethereum network, know how the tokens will perform. This greatly simplifies the creation of projects that can interact with the entire Ethereum ecosystem. Without the standard, projects would have to be changed to reflect the rules governing each new token issued. If we consider that in May 2018, 83,400 contracts were concluded for ERC-20 tokens, we can see that this standard is huge for developers.

Six functions defined by ERC-20

Six functions have been defined for the ERC-20 standard, and all of these functions are such that other smart contracts in the Ethereum ecosystem can recognize and understand them. These include token transfer, total token stock, and finding token balance at a given address. Around 99% of all current ERC-20 tokens have implemented the six basic functions outlined in the standard.

Problems with the ERC-20 token

Although the ERC-20 standard offers minimal compatibility, it does not specify everything needed to make a token valuable, useful, or even functional. Tokens can still be configured, and the standard allows it as long as the token still matches the basic functions and signals of the ERC-20.


One of the big benefits of the ERC-20 token development standard has been accelerating the growth of cryptocurrency through standardized features that have made it easier to develop and issue tokens for projects. It also increased synergies in the Ethereum network, aligning ICOs, exchanges and wallets. Since the protocol is already so useful, we are likely to see it being improved in the future to address common issues and problems.