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ERC20 Standard
20 January 2022     1283

ERC20 Standard

Although we have already made a small introduction to our blog, the world of cryptocurrency can be very confusing for the average investor. Especially for those who have no information about what a blockchain or smart contract is. However, the development of crypto and interesting conditions have led to many investors who would probably have been more careful in this world if they had made a similar decision.

While a typical investor without technical information can somehow cope with the crypto space, still this type of education is an important step towards the kind of benefits you need to have in the world of investing.

Specifically, ERC20 refers to the scripting standard used in the Etherium blockchain. This standard indicates the steps that an etherium token or smart contract must follow. Naturally both the explanation and the instruction are provided in advance. You can look at ERC20 as the guidelines that any new token must follow in Etherium Network.

The ERC20 standard has become a major way of creating different tokens in the crypto-space. It is especially popular with ICOs and crowdfunding companies. There are already tens of thousands of new tokens issued under the ECR20 standard.

Many ECR20 contracts have been used to perform various routines and functions in the digital world, although many have used the ICO (primary coin deposit) to generate NFTs; The ICO is like an IPO on a corporate exchange. In both cases, the company allows the ICO / IPO to obtain resources from various investors to provide the services specified in the project.

According to Nathan Reiff, Yahoo! has released information on ERC20 dominance in the ICO Market in 2017; Added to this was the fact that many successful cryptocurrencies were created exactly according to the ERC20 protocol. EOS, for example, created a token created to meet the popular ERC20 standard for more than $ 185 million during its five-day ICO release period.


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History of ERC20

ERC20 was created by the developers of Etherium, which was followed by a general response from the Etherium community in 2015. In 2017, he received official recognition. To do all this, it was necessary to upload an Ethereum Improvement Document (EIP) by the developers which would then be reviewed, approved, revised and finally approved by the relevant committee. Which happened even more.

Smart contracts or other similar elements have to fit into these standards, however this does not mean that it is the only similar measure in this area.

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ERC20 content

Contains several functions that the token must perform:

  • Total delivery: Information on the number of tokens
  • Balance: Information on the user account balance
  • Transfer: Makes transfers of a specified number of tokens to a specific address or address
  • Confirmation: Withdrawal of a specified amount from a specific account
  • Promotion: A certain amount will be returned from the sender to the original owner
  • Additionally these features trigger two processes: transfer and confirmation.



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Alternatives

Despite the popularity of ERC20, there are many people who feel that it is somewhat limited or see the potential for improving standards. Because of this, alternatives such as ERC223 have been developed that focus on transfers and the verification process.

The ERC621 is additionally another option that offers about the same features as the ERC20 so that it additionally changes the total delivery volume. Each new innovation refines and develops standards more and more.

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