ERC-20

ERC-20 is a technical standard for fungible tokens on Ethereum and other compatible blockchains. Fungible means each unit is interchangeable with every other unit, the way one dollar equals any other dollar. The standard defines a common set of functions a token contract must expose, such as checking a balance, transferring tokens, and approving another address to spend on your behalf.

Because tokens follow the same interface, wallets, exchanges, and applications can support any ERC-20 token without custom code for each one. Many widely used tokens, including most stablecoins, are issued as ERC-20 tokens.

ERC-20 defines only the interface, not the behavior behind it. The party that deploys a token still writes its own contract, which can include features like pausing transfers or minting new supply. Reviewing a token's contract and its issuer matters, since the standard alone does not guarantee how a given token is managed.