The cryptocurrency industry seems like a complex space. Complexity increases if you lack technical knowledge of blockchain and smart contracts concepts. Knowing some of the basic details on key digital currencies properties is important. It guides you towards the safest and soundest financial choices. Among the key concepts governing the crypto space is the ERC-20 token standard. This is also vital to smart contracts.
ERC-20 describes a scripting standard in the Ethereum blockchain. It determines rules and regulations governing an Ethereum token or smart contract. It also defines the steps required in implementation.
ERC-20 is a collection of basic principles and functionalities. These two parameters govern any tokens’ operation in the ETH network.
ERC-20 standard governs the creation and issuing of smart contracts within the ETH blockchain. Its implementation was in 2015. ERC is short for Ethereum Request for Comment. Smart contracts serve in the creation of smart property for tokenized assets. People invest in these assets. Among the renowned digital currencies using the ERC-20 standard are MKR, BAT, REP, and OMG.
Creating ERC-20 tokens demands certain key protocols that you should adhere to. This is because ERC-20 is a standard protocol for writing ETH smart contracts. It describes the functionalities required for the implementation of a crypto crowdfunding platform.
Contents/Functions of an ERC-20 Token
Before creating an ERC-20 token, there are key elements you must understand. These elements form the contents of this standard. The contents are the functions necessary for a compliant token. They include:
- Total Supply: Defines the total supply of the token
- Balance Of: Providing information about the account balance of the owner
- Transfer: Performing transfers of a certain number of tokens to a determined address
- Transfer Form: Ability to execute transfers of tokens from an account address
- Approve: Ability to allow a spender to make a token withdrawal from a particular account
- Allowance: Ability to return tokens from the spender to the account owner
In the wave of technological advancement, the discovery of crypto tokens was beneficial. The ERC-20 token standard is at the center of this revolution. It brings significant value to crypto enthusiasts.
Creating an ERC-20 Token
There are four different types of ERC-20 tokens. These are Equity, Utility, Asset-Backed, and Security tokens. Before creating your ERC-20 token, you must consider certain elements. These are:
- Token name
- Decimal places (up to 18)
- Number of tokens in circulation,
- Contract code
- Source code verification.
There are two principal approaches for creating an ERC20 token.
Method 1: Creating the Token by Yourself
This method requires that you have the relevant software skills. You must also have technical skills and solid knowledge of programming. The downside of this approach concerns the likelihood of issues and bugs in the output.
Method 2: Hiring Professionals
You can also create an ERC-20 token by bringing in help. Help entails the services and expertise of qualified blockchain developers, from a professional company. Companies tend to have ETH token developers who have commendable skills and expertise. The skill level gets better with the support of a blockchain development team.
With the second approach, all you have to do is share the requirements of your business with the team. Most successful ERC-20 tokens are developed by professional companies.
The cost of creating ERC-20 hinges upon the requirements. It also depends on the function that the ERC-20 will serve. On average the cost of minting ERC-20 tokens starts from $5000. The client determines tokens’ prices. The service provider plays a very small role. Another determining factor for cost is the number of services you use. These services include:
- Web wallet
- Cold storage
- Verification on Etherscan
Benefits of ERC-20 Token Creation
- Quick and easy deployment on the ETH blockchain
- Implemented on smart contracts
- Applied in a decentralized mechanism on ETH Virtual Machine (EVM)
- Help in determining problems with different tokens under its management
- Is the first specializing to offer specialized ETH token
- Is the specified token standard within the entire blockchain space. This is thanks to the amount of popularity earned in the marketplace
Developing a working ERС-20 token is not easy. Oftentimes, you must use the services of an experienced ERC-20 token development company. Working with a qualified company gives you a competitive advantage over your competition. This regards technical adaptation. Professionals can derive top-notch output on the criteria of efficiency and effectiveness.