ERC-20 Token: Everything You Need To Know

We’ll go through ERC-20 tokens, how to create compatible wallet addresses, and how to receive tokens on your ERC-20 wallet in this article.

ERC-20 Token

It’s understandable if you think bitcoin and its related notions are nonsense when you first test out crypto services and goods. It may take some time to completely understand the complexities involved, as with any new technology, especially if the operations almost always need a hands-on approach. This is why we’ve prepared guides that explain the fundamentals of cryptography.

What Is a Token?

Ethereum is a blockchain ecosystem that houses a number of different blockchain applications. Consider it an operating system that provides app developers with a configurable environment. The only difference is that Ethereum makes use of blockchain technology and emphasizes autonomy, security, and immutability. Smart contracts are used in blockchain apps to automate functions and enable autonomy.

However, these apps frequently issue tokens in order to provide users with new features or capabilities. These tokens may allow users to claim a portion of the app’s revenue in some instances. Some are used to make trading on Ethereum-based exchanges easier. Tokens can be used in a variety of ways, depending on the developer’s design choices.

Another thing to keep in mind is that tokens are not kept by accounts. Tokens are stored in contracts, which act as decentralized databases that map tokens to Ethereum addresses. The token contract also governs and describes the rules that apply to a particular token. Developers use this to define the name, symbol, divisibility, and other key token identifiers.

As a result, the present owner can only transfer ownership of tokens if he or she sends a request to the contract instructing it to distribute a portion of the balance to another Ethereum address. The owner must pay a gas cost in ETH to register this transfer on the blockchain.

What exactly are ERC-20 tokens now that you know what a token is?

What is an ERC-20 Token?

The Ethereum core team came to the conclusion that promoting a Wild West ecosystem where developers might generate several token versions was not feasible. Instead, they established token standards that regulate Ethereum development and ensure excellent compatibility.

ERC-20, or Ethereum Request for Comments-20, is the most common token specification on the Ethereum blockchain. It was created in 2015 and has since enabled the standards for generating digital assets that may interact fluidly. This standard is then used by wallets and other ERC-20 compatible services to enable their infrastructure to receive, store, exchange, and transmit ERC-20 tokens.

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How Do I Get an ERC-20 Token?

You’ve probably discovered an intriguing Ethereum startup and want to receive its native ERC-20 token. If this describes your current situation, you have come to the right place.

The first thing you should know is that ERC-20 tokens can be sent to any Ethereum address. While this is a certainty, it is ultimately up to your wallet provider to grant you access to your ERC-20 token balance. To put it another way, while some wallet providers support ETH addresses, you may not be able to see ERC-20 tokens associated with the address.

This is why it’s a good idea to check the compatibility of wallets ahead of time. If you plan on getting airdrops, make sure your wallet not only supports ERC-20 tokens, but also identifies the precise token you want to receive. Airdropped tokens are typically obscure digital assets that have yet to be listed on exchanges. If this is true, such tokens are unlikely to be supported by exchange wallet addresses.

MyEtherWallet (MEW) and MetaMask are two wallets that are suggested for ERC-20 tokens. Whatever ERC-20 token you’re looking for, you can be sure it’ll be accessible through these two wallets.

It’s vital to understand that both of these ETH wallets are self-custody wallets before creating an account. As a result, they’ll keep your private keys on your devices and expect you to write down and remember your seed phrase. When you lose access to your wallet or forget your password, you must enter a seed phrase, which is a set of 12 random phrases.

Creating an account on MetaMask and MEW is simple and uncomplicated. However, for the purposes of this guide, we’ll stick to using the MetaMask option.

How to Create a Metamask ETH Address

  • Visit https://metamask.io/ for more information. and look for an extension that works with your browser.
  • Install the necessary extension by clicking on it.
  • After you’ve downloaded and installed the extension, click on the icon to create and confirm your password.
  • Accept the terms of service and authorize the extension to reveal your seed phrase. It’s a good idea to keep numerous copies of these secret words in safe places. The account registration process is complete once you have backed up your seed phrase.
  • Navigate to the Deposit Ether Directly page to see your ETH or ERC-20 address. Then, to see and copy your address, go to View Account. You can now paste the address into any airdrop portal that asks for an ERC-20 address in order to receive free tokens.
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How to Use Metamask to View ERC-20 Tokens

So, now that you’ve acquired ERC-20 tokens via airdrop, how do you feel about them? If you follow the steps below, you’ll find this to be pretty simple as well.

  • If you can’t find the token when you go to the Assets menu, you may have to manually add it.
  • To widen the search, go to the Add Token tab and select Custom Token.
  • The token address must be entered in the corresponding field. The Token Symbol and Decimal fields are frequently auto-filled. If not, you’ll have to look for the token project’s documentation to learn more. On Ethereum blockchain explorers like Etherscan or Ethplorer, you can look up the token contract address. Even better, you can ask the sender for the token address directly. Airdrops that do not reveal token contract addresses should be avoided.
  • When you’ve finished filling out all of the fields, click Next and then Add Token to confirm.

How to Use Metamask to Receive and View NFT Tokens

We’ve decided to clarify some of the steps involved in getting and seeing ERC-721 standard tokens, also known as non-fungible tokens (NFTs), in light of the recent surge in airdrops.

To begin, you must first have access to your ETH address, as indicated above. Once the transaction has been confirmed, it is suggested that you see the NFT on the MetaMask mobile app, as collectibles are not currently viewable on the web version.

If the NFT isn’t included in the collectibles area, go to Add Collectibles and fill in the collectible ID and address in the proper fields. The NFT should now appear under the Collectible tab when this has been completed.

Conclusion

As you may have noticed, creating an ERC-20 address and receiving tokens is quite simple. One thing to bear in mind is that all ERC token transactions require ETH gas fees. As a result, before conducting transactions, make sure you have enough ETH to cover the charge.