ERC-20 Token Standard: Everything You Need to Know

When working with ERC-20, a widely used token standard on the Ethereum blockchain that defines how tokens interact with wallets, exchanges and smart contracts. Also known as Ethereum token standard, it powers most of today’s crypto assets. The ERC-20 token standard lets developers create fungible tokens that can be transferred, approved, and queried using a common set of functions. This simplicity is why countless projects, from airdrops to DeFi protocols, rely on it.

At the heart of ERC-20 lies Ethereum, the blockchain platform that introduced smart contracts and the concept of programmable money. Ethereum provides the execution environment for ERC-20 contracts, handling transaction ordering and state updates. Because Ethereum is public, permissionless, and secured by a massive network of validators, anyone can deploy an ERC-20 token without needing approval from a central authority.

Every ERC-20 token lives inside a smart contract, self‑executing code that enforces token rules without a central authority. The contract stores balances, defines transfer logic, and exposes standard functions such as transfer, approve, and allowance. Once the code is on chain, it cannot be changed, which gives users confidence that the token will behave exactly as written—provided the contract was audited before launch.

One popular use case is the airdrop, a free token distribution event that seeds a new ERC‑20 project with users. Airdrops often require participants to hold a certain token, complete a short task, or simply sign up with an email. The ERC-20 transfer function makes it cheap to send tiny amounts to thousands of addresses in a single transaction batch, letting projects quickly build a community of token holders.

DeFi platforms build their economy around DeFi tokens, ERC‑20 assets that represent governance rights, liquidity shares, or yield incentives. Whether it’s a governance token like UNI, a liquidity‑provider token that tracks a share of a pool, or a reward token that users earn by staking, the same ERC‑20 functions let them move, trade, and vote across dozens of protocols without leaving the Ethereum ecosystem.

Interacting with ERC‑20 contracts isn’t free—each call consumes gas paid in Ether. Gas fees rise when the network is busy, which can make small transfers or airdrop claims expensive. Recent Layer‑2 rollups and the Ethereum “Shanghai” upgrade have lowered average fees, but anyone dealing with ERC‑20 tokens still needs to watch gas prices, time their transactions, or use batching tools to keep costs reasonable.

Key Concepts Around ERC-20

Understanding ERC‑20 means linking several ideas: the token standard itself, the Ethereum chain that hosts it, the smart‑contract code that enforces it, the airdrop tactics that spread new tokens, and the DeFi token economics that give those assets value. Each of these pieces influences the others—airdrop design depends on gas costs, DeFi token utility relies on smart‑contract security, and Ethereum’s upgrade roadmap can reshape how cheap and fast ERC‑20 transfers become.

Below you’ll find a curated collection of articles that dig into each of these topics. From step‑by‑step airdrop guides and token‑omics breakdowns to practical gas‑fee strategies and real‑world ERC‑20 case studies, the posts give you both the theory and the hands‑on tips you need to navigate the token ecosystem with confidence.