Ether & ERC20 Tokens... What do they mean?
Welcome to the DIFX Token Thursdays, where we discuss you guessed it! All things Tokens. With so many tokens out there, it is understandable to get confused about the differences and similarities between them.
In this series, we will go into detail about the various crypto tokens, how they were created, how they work and most importantly why should you know about them.
What is ETHER?
Before we discuss Ether (ETH) we need to understand what Ethereum is. Ethereum is a decentralized blockchain software that establishes a peer-to-peer network for the secure execution and verification of application code, called smart contracts. Ethereum is the most common blockchain used to build various blockchain applications and is designed to be scalable, programmable and highly secure. It is the blockchain of choice for developers and enterprises, who are creating technology based upon it to change the way many industries operate and the way we go about our daily lives.
Ether in detail
Created in 2015, Ether (ETH) is known as the fuel for operating the Ethereum platform. Like other digital currencies, Ether can be used to pay for goods and services. But it is also used to support the development of applications on the Ethereum network.
Uses for Ether:
- Payments are made with Ether for computational services and transaction fees.
- Developers use Ether to create Smart Contracts and DApps on the Ethereum network.
- Ether can be used as an investment whose value can go up or down. It can be owned or used as a tradable instrument.
- Ether comes into existence by the validation of transactions on the Ethereum platform, through a process called mining. Those performing this validation are referred to as “miners”.
But what does ERC-20 mean?
Ethereum is much more than just a type of blockchain, it is a comprehensive platform that allows various tokens and decentralized apps to be built upon it by using smart contracts. Therefore to build a token on Ethereum, developers need to adhere to a set standard known as ERC-20. ERC stands for Ethereum Request for Comment and 20 relates to the number of functions it performs on the blockchain.
In simple terms, ERC-20 acts like a rule book for individuals to create their very own tokens using the Ethereum blockchain. ERC-20 is the universal language that all tokens on the Ethereum network use, meaning that one ERC-20 token can be interchanged for another and can be easily integrated with the Ethereum based applications…
Some ERC-20 functions include:
- Authenticity & Uniqueness: Each ERC20 token has a unique name, symbol, and identifier to differentiate it from each other.
- Total Supply: Allows to input in all the information regarding the token in the smart contract
- Token Transfer: This allows the secure transfer of a specific number of tokens to a selected address.
More importantly, many well-known tokens & DeFi Applications (d’apps) you’ve heard about are built on the ERC-20 standard. MANA(Decentraland), UNI(Uniswap), SAND(Sandbox), WBTC(Wrapped Bitcoin) etc are great examples of ERC-20 tokens. Popular D’apps include OpenSea, MetaMask, Sushiswap etc. In fact, the DIFX token is also an ERC-20 token, meaning it is built on the Ethereum blockchain and complies with the above-mentioned functions.
By being an ERC-20 token, the smart contract of DIFX distinguishes it from other tokens, showcases the total supply and ensures that they are transferred in a secure manner on the blockchain.
Trade ETH & a multitude of ERC-20 tokens today with DIFX!
Stay tuned every Thursday for a new token breakdown and leave us suggestions on what you want to be featured.
About DIFX
DIFX is a CEX that uses blockchain technology to incorporate centralized finance. It is an easy-to-use platform for both new and experienced traders, establishments, and investors. As covered by Cointelegraph, BeInCrypto, and many other media outlets, DIFX allows users to nominate anyone from their family, friends, or loved ones and allows them to legitimize their claim upon the primary user’s demise.
Additionally, the company hopes to increase the use of digital currencies for direct settlement between beneficiary and payer by eliminating intermediaries. To begin your journey with Endless Possibilities, download the app now from the iOS or Google Play Store, or visit us at difx.com.
