ERC-20
A standard for creating and issuing tokens on the Ethereum blockchain.

What Is ERC-20?
ERC-20 is a technical standard used on the Ethereum blockchain for creating and managing tokens. It sets rules that allow different tokens to operate within the Ethereum ecosystem, ensuring they can be easily shared, traded, or used within decentralized apps (dApps).
How It Works
- Standard Set of Rules: ERC-20 defines basic functions that all Ethereum-based tokens should have, like transferring tokens from one wallet to another and checking an account's balance.
- Interoperability: Because all ERC-20 tokens follow the same rules, they can be used in any Ethereum-compatible wallet or dApp without custom coding, making them easy to integrate across the Ethereum network.
- Smart Contracts: ERC-20 tokens use Ethereum’s smart contracts to securely record transactions and enforce token rules.
Example
Popular tokens like USDC (a stablecoin) or Chainlink (LINK) are ERC-20 tokens, meaning they operate on Ethereum’s blockchain. This standard allows them to be traded on Ethereum-based exchanges or held in any Ethereum wallet.
Key Takeaways
- ERC-20 is the standard for tokens on the Ethereum network, ensuring they can all work seamlessly together.
- Interoperable and flexible, ERC-20 tokens can be traded, stored, or used across wallets and apps within the Ethereum ecosystem.
- It enables a secure, consistent experience for users and developers working with Ethereum-based tokens.
In short, ERC-20 is the “rulebook” for creating Ethereum tokens, making it easy for them to operate and be traded across the Ethereum network.
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