Tokens ERC20 simple words

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Tokens ERC20 simple words

In cryptosuite lot of acronyms. This may deter newcomers, especially given the fact that often these designations are a combination of letters and numbers. If it is very short, the token ERC20 — is a cryptocurrency that was created on the Ethereum platform. Now let’s find out what it means.

Many people know the Ethereum at the bitcoin ether (Ether or ETH), which can be found on almost every cryptocurrency exchange. One of the unique features that differentiates it from bitcoin (at least at the moment) is that it assumes the ability to program smart contracts. The smart contract is just a marketing designation of computer code that can be used in the blockchain (read more about smart contracts you can read in the article). In fact, you can write code in the Ethereum blockchain, and instead of a simple store transaction history it will store a logic combination on the basis of which are familiar to us apps.

But, to be completely accurate, we can’t just call them apps. In the end, they are not like ordinary applications; these applications are recorded in the blockchain, Ethereum, decentralized in nature, because the platform Ethereum decentralized. So we call them decentralized applications (or dapple for short).

At the expense of most of these gappov the creators want to produce their own coins, which are called tokens. Users must use a certain coin in the interaction with specific deppom.


ERC20 is a standard that describes the tokens Ethereum

People quickly realized that creating coins requires certain standards. This is how to issue a credit card. Each card has a black strip on the back, but most modern cards, there is also a chip. The card number, expiration date and security code are one of the common for cards standards.

But imagine that someone decides to create a credit card for which there will be no information except a QR code. Of course, this minimalism will look stylish, but it is unlikely it will be appreciated in the shops, because he does not meet the standard rules of credit card design.

ERC20 is a standard for creating tokens on the blockchain of Ethereum. It includes a list of rules that must match the tokens. In this article we will not go into technical details (you can view them here).

Storing tokens ERC20 and trafficking

Because tokens ERC20 built on the Ethereum blockchain, they can be exchanged for air. You can use your Ethereum— wallet to store them and send those coins to other Ethereum wallets. However, never use addresses kryptomere.

We will not delve into the technical details of why you shouldn’t do; just be aware that the exchange generates unique addresses for each coin. In other words, your address for broadcast and token ERC20 will be different. If you try to send a token ERC20 on ETH— address of the exchange, she doesn’t recognize and you will be credited tokens ERC20. However, in your own wallet you can store any cryptocurrency based on Ethereum.

Why build dappy on Ethereum?

This is a good question that has no easy answer. Since launching smart contracts on the Ethereum in 2015, there are many other blockchains with the same functions. For example, the blockchain NEO, which uses traditional programming languages such as Java, while the Ethereum has its own language of Solidity. Perhaps it is you nothing says. The point is that there are other blackany that support smart contracts that is different from the smart contracts Ethereum.

However, the Ethereum remains a platform for smart contracts number one with the largest market capitalization. Of course, this does not mean that he is beyond the reach of competitors, because Ethereum has a lot of disadvantages. But with thousands of dappu, which has already invested a lot of money, he is far ahead of the competition in terms of a global recognition platform.

Now, when someone says “the Ethereum token” or “token ERC20”, you will be able in General terms to understand what they hear. Remember that this is just a crypto-currency, built on the Ethereum blockchain.

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