“Token” and “Cryptocurrency” are often used interchangeably; all cryptocurrencies are tokens, but not all tokens are cryptocurrencies. Token, in the context of ERC-20 compliance, simply means a blockchain representation of something that meets the standards set by the Ethereum community to be considered a smart contract standard-compliant token. This means that other tokens can run on top of it, and decentralized applications (dapps) can be built atop it using smart contracts. ERC20, which stands for “Ethereum Request for Comments 20,” is a technical standard used for issuing and managing tokens on the Ethereum blockchain.
#3. Binance Coin (BNB)
- Uniswap is one of the most popular and widely used decentralized crypto exchanges (DEXs) on the market, having led the way in the field for some time now.
- In the Crypto.com App, users can conveniently buy ERC-20 tokens and 250-plus other coins using a credit/debit card, Apple Pay, Google Pay, or 20-plus fiat currencies transferred from their bank account.
- Overflow occurs when the result of adding tokens to a balance exceeds the maximum value that the data type used to store the balance can represent.
- ERC20 compliant tokens have been issued during Initial Coin Offerings (ICOs).
It’s a bit like watching the internet evolve – you know it’s going to be big, but you can’t quite picture exactly what it will become. Audits are essential to identify and fix potential issues before deployment. It’s like building a house – you need to make sure the foundation is solid before you https://ai-robert.com/ start adding walls. Formal verification methods can also be used to mathematically prove the correctness of a smart contract.
Atomicity in blockchain refers to all components of a transaction executing and completing as a whole; either the transaction goes through or doesn’t, and no component is completed in part. For those interested in understanding the token standards of other blockchain ecosystems, this University article has all the information. The above factors have led ERC-20 tokens to surge in popularity, paving the way for the initial coin offering (ICO) boom that began in 2017. With billions of dollars raised, a new generation of projects was launched during that time — with many becoming pillars of the cryptocurrency space. As of December 2020, there are 829 projects based on the ERC-20 token standard and over 350,000 token contracts, according to a dynamic list from Ethereum data provider, Etherscan. Like any cryptocurrency, ERC-20 tokens are not immune from security breaches.
With this, developers set the name, symbol, divisibility and other important token identifiers. This standard is called BEP-2 and is similar to ERC-20 in that it guides token creation for use on the Binance Chain. This simplifies the task for developers; they can proceed with their work, knowing that every existing project won’t need to be redone every time a new token is released. Additionally, new projects won’t need to worry about compatibility with old projects as long as the token follows the rules.
Read our beginner’s guide to Ethereum’s ERC20 token standard.
By leveraging Ethereum’s robust infrastructure, an ERC20 token inherits the scalability and security features of the Ethereum blockchain, facilitating efficient transactions and smart contract execution. Another thing you need to know about tokens is that they are not held by accounts. Tokens exist in contracts, which function like decentralized databases that map tokens to the appropriate Ethereum address. Also, it is the token contract that governs and specifies the rules that apply to a given token.
Are ERC20 tokens safe?
ERC-721 introduced the concept of non-fungible tokens (NFTs) with unique identifiers for each token. NFTs support complex ownership structures for use cases like virtual worlds, art, ticketing, collectibles, and more. Additional ERC-20 tokens include Compound (COMP), Basic Attention Token (BAT), Polygon (MATIC), The Sandbox (SAND), Immutable (IMX), Wrapped Ethereum (WETH), and Pepe (PEPE). These examples of ERC-20 tokens represent just a fraction of the diverse ecosystem of Ethereum-based tokens, each serving unique purposes and catering to various use cases within the DeFi ecosystem. WBTC is an ERC-20 token pegged to the value of Bitcoin, allowing users to access Bitcoin liquidity on the Ethereum blockchain. ERC-20 tokens can be easily traded, exchanged, and integrated into various Ethereum-based applications, enhancing usability and interoperability between dApps.
Moves the amount of tokens from the function caller address (msg.sender) to the recipient address. The ERC-20 standard allows an address to give an allowance to another address to be able to retrieve tokens from it. This getter returns the remaining number of tokens that the spender will be allowed to spend on behalf of owner.
