Topic: What’s the point of ERC-20 tokens (Read 222 times)

Promoting the project for what? I think that was useless or senseless but I think each must have their own motives on why they create a project and they promote it. It can be for quick profits only or they are really serious about it.

But if it was for the sole purpose of quick profits, then they can choose another network, since Erc-20 is kind a heavy or costly, and a lot of people can get turned off with it as well due to the cost of fees, but anyways, nowadays, many projects including those crap ones are not from Erc-20 anymore. They don't need to spend money on advertisements either because there are free sources like social media and this forum, and then they will only use their token as a payment to their participants.

Here maybe this article would give you an idea about ERC-20 tokens https://www.investopedia.com/news/what-erc20-and-what-does-it-mean-ethereum/

You can always check the roadmap and the whitepaper of each ERC-20 tokens to know what are the new innovation they could bring or offer to their investor. But you cannot rely to much on the information since some of developer just write some good plans but they would never execute it in real time.

So always choose those token which always follow what they have written on their roadmap or something that has good utility. Since those project have great chance to have more good development that is helpful to their token created.

Yes generally they use the same tech because all ERC20 operate on the Ethereum blockchain. Different companies, despite the same fundamental structure of the tokens, can offer different use case. Some are stablecoins while some are native to a specific platform. Some can twitch a few things to make them a little unique and make them stand out among the rest. Some examples are uniswap and rndr which have different purposes.
They both use ERC20 which allows for use of smart contracts. Smart contracts are not exclusive to ethereum but it is famously the best for installing smart contracts.

That's because ERC-20 is the gold standard of digital tokens. It's used by Ethereum and other chains compatible with the EVM. Companies/startups prefer to use the same tech rather than use one made from scratch. It's more convenient for them. Solana has its own set of tokens which are incompatible with the ERC-20 token standard used by Ethereum-based chains. By this, I mean chains like Binance Smart Chain (BNB), Avalanche (AVAX), Optimism (OP), Arbitrum (ARB), and Polygon (POL).

ERC-20 are just ordinary tokens which represent value (money). Non-Fungible Tokens (NFTs) have their own standard named ERC-721. They represent digital art, in-game items, and whatnot. I'd suggest you read Ethereum's documentation by going to www.ethereum.org if you want to learn more. Hope this helps.

Yes, ERC20* did this early and they are dealing with a lot of profit from this even to this day. I believe the more we keep trying on this, the more trouble we are going to be in and I believe the best thing to move further would be just realizing what we can do for the future as well.

Because if ERC20 was great at the time when they did this, then they would be great at anything else as well. If TON could do telegram games, then ERC20 could have the same if they wanted to, which they didn2t see a need to because it's all for nothing as we can already see, but this isn't really a good thing and we should avoid it if we possibly could. I believe we need to just focus on whatever we can, and eventually we will grow bigger.

Nothing new, only a few has a real utility value because the token maybe, has an economy that allows investoor or customer to spend the token on that ecosystem which can cause the value of the token to increase. Because majority of those projects don't have any real world value, that's why we have shitcoins all over the crypto ecosystem.

the token is just representation.


have you seen stock, it's representation of company value and share holders. same thing with token, you got more token, you got more power and the value of the project also derived from the token completely.
if you think about it, it's just sort of digital stock, but not really similar, there's differences here and there.

the reason they all deploy token, because it's easy, and doesn't require much effort, ERC20 was made to facilitate people into deploying their own coin but in form of token taking advantage of the smart contract.

asriloni, thanks for taking the time to outline both the purpose and usage of ERC-20, tokens to the ops and also pointing out the limitations of some of the ERC-20 who are nothing but just imitation, because the rate of fake and scam project that based on the ERC-20 tokenization network is quit huge and every newbie need to be enlighten about them before the god on investing in some of those shitcoins and thinking they are investing in some worthwhile projects.

Cryptocurrency space is widening and alot is happening aside from the fact that, some projects make remarkable success and at that making the market to become very popular, others are just in the industry for what they can grab from low knowledge investors and for sure staying away from ERC-20 tokens as a newbie is most likely to be the best decision in other to safeguard your capital.

Tokens is just a utility token while the project itself is the that provides technology. You can consider the ERC20 tokens as fuel to the crypto projects that running it. ERC20 is just the standard token running on Blockchain but they do have different functions and use depending on the project that use it as utility.

This ERC20 tokens can be found on other blockchain like Binance(BEP20), Tron(TRC20) and many more they are all same token running on different blockchain.

Speculative investment I guess, lots of people do very well trading them. Most of them have little to no real world use case but you can’t argue with the fact that many people have made life changing money in them.

They serve pretty much the same purpose as any other tokens out there and that is to sell something virtual and useless to raise money for those behind it. Remember that it is far easier to just create a useless token and sell it to gamblers than it is to create a completely standalone cryptocurrency (with blockchain and everything including mining), which is why everyone chooses tokens and they keep coming up with newer names for them with similar protocols with slight differences.

Yes, they use the same technology in token standardization on Ethereum, but the case studies are different. We have tons of token case studies in crypto, the examples are DeFi, GameFi, Metaverse, RWA, DePIN, AI, and many more that may come. And of course, they should be from different companies with their own missions.

My advice, since you're a newbie, when you want to invest, make sure you have done due diligence on the project first, don't jump into a project that will just come and go like memecoin.

As most other blockchain assets without own blockchain, ERC-20 tokens are mainly a crowdfunding mechanism for businesses (in theory, even charities can use them). Their product may vary like TastyChillySauce00 wrote here, so the grade of innovation is tightly related to the product, not the token itself.

In general one can differentiate between utility tokens (which have again subclasses like governance tokens), security tokens and some special types.

Utility tokens are used to be exchanged to functions on a platform or services of a company (for example, credits in apps). This name is often also used for tokens which can be exchanged for a future service and for those which are used to pay variable fees. Some jurisdictions like the EU require an utility token to be exchanged to an existing service,

Governance tokens is a special kind of utility token which provides a right to vote in a DAO.

Security tokens are tokens with the character of a security, i.e. their value depends on an effort of the company (like a stock). Most RWA tokens (real world asset) tokens, pegged to a "real world" asset like a stock or real estate, fall also into this category.

Special types include stablecoins and some exotic DeFi tokens which can have complex rules.

A nice guide of different token types, use cases and regulations can be found here. Almost all of them can be created with the ERC-20 standard.

I second however the opinion that most ERC-20 tokens indeed are used for purposes which aren't really worth an investment (only for short-term speculation). In most cases, IMO there is no need to use a blockchain for the supposed application.

PS: Forgot one use case: some ERC-20 tokens are used to bootstrap an altcoin with an own blockchain. The ERC-20 token then will be used to conduct the ICO, while the developers work on the real blockchain project, and later the ERC-20 tokens are swapped to coins on the final mainnet blockchain.

Chainlink & Uniswap are just two examples of ETH based tokens which are popular and provide unique features that people actually use. With these and several other exceptions in mind, most of the others are indeed garbage, not built to last long-term.

Most of the tokens are just money grab schemes. Some of us who were in the ICO boom got to see this first hand. Most so-called projects with Zero innovation would promise investors sweet-nothings if they launched successful, but a few years later almost over 95% of them died. Today, ERC20 tokens and other forms of tokens on other networks are a big joke, and you will be very lucky to land on one that is good.

Shit tokens also get hyped up, and they can pump in price fooling investors to buy them due to FOMO only for them to dump toward zero, so be very careful about them.

it's not ERC20 token that matters but the utility behind it, for all I know they could use it for various purposes such as governance, staking, incentivization, rewards distribution and so on.
so each ERC20 token has their own utility, as for ERC20 itself, it's just a protocol, these project don't want to spend time developing their own blockchain which is also difficult so they just settle with ERC20 because they can also get the benefit from the security of ethereum blockchain.

so in a nutshell, it's not just people promoting the same thing, but the ERC20 token represents their product.

even stablecoin is just ERC20 but the company behind it back the token with real asset 1:1 so it gained new utility and value.

The ease of creating such tokens makes the possibility of achieving success limited only to making efforts to promote the project more than inventing something new, so you will find that most of the ERC20 is copy and paste and zero technical progress compared to spending on advertising and promotions.

They exploit the rising wave to promote their projects, so if the talk is about Memecoin, you will find the name of the project changed to Meme and so on.

Most of the time they are really just that copycats or really just that making use of the same chain and thats why i do really prefer on investing into L1's rather than on going with L2's or 3's but of course there would really be having that corresponding difference on which other features couldnt really be seen on L1's and this what makes investors would really be trying out to invest because of such features but of course it will really be that
depending on someones choice and risks taking. As for those projects mentioned above then i havent searched up their differences or those precise spots on where they are really that not the same.
This is where it will really be relevant that you would be making out some research or in depth ones basing up into the project that you are really that eyeing on. Just be careful with tons of copy cats out there
and even having those kind of unrealistic roadmaps or project utility that being boast out. You could be able to point out on which projects are really that able to possibly reach out their goals
or targets when it comes to utility and not really just that making some promises and as if they could really be able to make it happen.

Yes, they are. They're all using ERC20 for tokenization purposes. But, they were utilizing ERC20 tokens for various purposes. These include governance, staking, and more. Some companies were innovating. But, many just imitated each other.

In the case of Beam and Render, they were using different tech. Render used ERC20 for their token. Beam is building in their own blockchain. They were not using the same tech.

I’m fairly new to crypto and many are promoting the various ERC-20 tokens out there

My question are they all using the same tech and if they are the same just different companies what new innovations do they bring?

Surely in this case people are just buying into the business plan of the company behind it, I.e Beam or Render and how they use this same tech?