ERC-20 Token Standard – Everything You Need to Know

When working with ERC-20, a technical standard for creating fungible tokens on the Ethereum blockchain. Also known as Ethereum Request for Comment 20, it defines a common set of functions that let wallets, exchanges, and dApps interact with tokens seamlessly. ERC-20 has become the backbone of most crypto projects, powering everything from stablecoins to utility tokens. Because the rules are open‑source, developers can copy, modify, or extend the code without reinventing the wheel, which speeds up innovation and cuts costs.

The ecosystem revolves around Ethereum, a decentralized platform that runs smart contracts. Ethereum provides the blockchain where ERC-20 contracts are deployed, and its robust security model protects token balances from tampering. ERC-20 enables token creation on Ethereum, while Ethereum’s gas‑price mechanism influences how cheap or expensive token transfers become. This relationship creates a feedback loop: lower gas fees encourage more token launches, and more tokens increase network usage, prompting upgrades like Ethereum’s shift to proof‑of‑stake.

At the heart of each token is a smart contract, self‑executing code that enforces the token’s rules. The contract implements the ERC-20 interface, guaranteeing functions such as transfer(), approve(), and balanceOf() work uniformly across all tokens. Smart contracts define token behavior, enforce supply caps, and manage ownership rights. Because of this uniformity, crypto exchanges, platforms that list, trade, and settle digital assets can integrate new ERC-20 tokens with just a few lines of code, reducing onboarding time from weeks to minutes.

Why ERC-20 Still Matters in 2025

Even with newer standards like ERC-721 for NFTs and ERC-1155 for multi‑token projects, ERC-20 remains the go‑to choice for DeFi protocols, governance tokens, and payment solutions. The standard’s simplicity means audit firms can review contracts faster, lowering security costs. Moreover, many layer‑2 solutions (Optimism, Arbitrum, zkSync) inherit ERC-20 compatibility, letting users enjoy faster, cheaper transactions without abandoning the familiar token model. Token standards influence exchange listings, affect liquidity pool design, and shape how investors evaluate risk, making ERC-20 a critical factor in any crypto‑related decision.

Our collection below covers the full ERC-20 landscape: from step‑by‑step guides on writing your own token, through deep dives on gas optimization, to side‑by‑side comparisons with ERC-721 and ERC-1155. You’ll also find analysis of how token standards impact regulatory compliance, real‑world case studies of successful ERC-20 projects, and tips for navigating exchanges that support the standard. Dive in to get practical insights, avoid common pitfalls, and stay ahead of the curve in the fast‑moving world of blockchain tokens.