Continuing our series on blockchain, let’s understand what is a cryptocurrency and what is an ERC20 token.

This article is available in Portuguese on Youtube: https://www.youtube.com/watch?v=Y71KOdn0em8

What is cryptocurrency?

The word cryptocurrency, or digital currency, is used for crypto assets that have their own blockchain. Therefore, Bitcoin, Ethereum, Ripple and Litecoin and are examples of cryptocurrencies.

What is a Token?

Token is the word used for assets that do not have a blockchain. For example, USDT and USD Coin stablecoins are tokens on the Ethereum network. This means that they depend on the same blockchain as the ETH coin to exist.

Well, in this scenario, you can already understand the small difference, correct? But what is the ERC20 anyway?

ERC20

ERC20 is a standard that was developed on the Ethereum network that aims to standardize the tokens that were being created.

Before ERC20 each token had its own smart contract, in other words we can say that every time a new token was launched it was necessary to write a “unique” code. In the long run this was proving extremely complex and time consuming.

With the ERC20 standard implemented, developers’ progress in creating new tokens and at the same time currency exchanges publishing them in their portfolios was extremely fast.

Although we are saying that ERC20 is part of Ethereum, today when we program an ERC20 token it is possible to use it on BSC, Polygon and others networks, this is because these networks adopted the same development pattern, mainly to accelerate the development of dApps on your networks, and we developers appreciate that, because it makes our work much easier right now… hahaha

In the next articles I will demonstrate how we can create our Token in an extremely easy way, following the ERC20 standard.

I’ll see you soon!