ERC-20 is a set of technical standards used for creating tokens on the Ethereum blockchain. It outlines a common set of rules that must be followed by any token created on the Ethereum network so that it can be used by various decentralized applications and smart contracts. This standardization makes it easier for developers to create, issue, and transfer tokens in a uniform and predictable manner, which enhances the overall interoperability and functionality of the Ethereum ecosystem.
One of the main benefits of ERC-20 tokens is that they can be traded on decentralized exchanges, which allows for greater security and control over the trading process. Additionally, ERC-20 tokens can be used to raise funds through Initial Coin Offerings (ICOs) or to create reward systems and loyalty programs. Some of the most popular cryptocurrency, such as Binance Coin, Chainlink, and OmiseGO, are ERC-20 tokens.
Overall, the ERC-20 standard has been instrumental in the growth and development of the Ethereum blockchain and the decentralized finance (DeFi) ecosystem. It has paved the way for the creation of innovative and flexible financial instruments, and has enabled the creation of a thriving ecosystem of decentralized applications and services.