Introduction
What is a Token?
Tokens can represent virtually anything on the Ethereum blockchain:
- Reputation points in online platforms
- Skills of a video game character
- Financial instruments like company shares
- Fiat currencies like the US dollar
- An ounce of gold
- And much more...
Ethereum's powerful tokenization capability requires a robust standard—enter ERC-20. This standard enables developers to create interoperable token applications that work seamlessly with other products and services.
What is ERC-20?
ERC-20 establishes a standard for fungible tokens, where each token is identical in type and value (e.g., 1 ETH = 1 ETH). It ensures uniformity across all tokens created under this protocol.
Prerequisites
Core Concepts
ERC-20 Overview
Proposed by Fabian Vogelsteller in November 2015, ERC-20 (Ethereum Request for Comments 20) defines an API for tokens within smart contracts. Key functionalities include:
- Transferring tokens between accounts
- Checking an account's token balance
- Retrieving the total token supply
- Approving third-party token spending
👉 Explore ERC-20 Token Examples
Methods (EIP-20 Standard)
function name() public view returns (string)
function symbol() public view returns (string)
function decimals() public view returns (uint8)
function totalSupply() public view returns (uint256)
function balanceOf(address _owner) public view returns (uint256 balance)
function transfer(address _to, uint256 _value) public returns (bool success)
function transferFrom(address _from, address _to, uint256 _value) public returns (bool success)
function approve(address _spender, uint256 _value) public returns (bool success)
function allowance(address _owner, address _spender) public view returns (uint256 remaining)Events
event Transfer(address indexed _from, address indexed _to, uint256 _value)
event Approval(address indexed _owner, address indexed _spender, uint256 _value)Practical Example (Python Web3.py)
from web3 import Web3
w3 = Web3(Web3.HTTPProvider("https://cloudflare-eth.com"))
dai_contract = w3.eth.contract(
address="0x6B175474E89094C44Da98b954EedeAC495271d0F",
abi=simplified_abi # Simplified ABI for ERC-20 methods
)
symbol = dai_contract.functions.symbol().call()
total_supply = dai_contract.functions.totalSupply().call()
print(f"Token: {symbol}, Supply: {total_supply}")Known Issues
Token Reception Problem
When ERC-20 tokens are sent to a non-compliant smart contract, they may be lost permanently due to:
- No Notification Mechanism: Contracts aren’t alerted of incoming tokens.
- Missing Handling Logic: Without fallback functions, tokens get stuck.
Solution Standards:
FAQs
What makes ERC-20 tokens unique?
They are fungible and interchangeable, making them ideal for currencies and standardized assets.
Can ERC-20 tokens represent NFTs?
No—use ERC-721 for non-fungible tokens.
How do I avoid losing tokens in contracts?
👉 Always verify contract compatibility before transferring.