How to Create ERC20 Token? – Complete Guide

How to create ERC20 tokens

ERC is the acronym for Ethereum request for comment which is similar to the “request for comment” that is derived for carrying out essential technical notes. More specifically, it is more popular among ICOs. An ERC20 is a common token standard used for creation and distribution of smart contracts over the Ethereum blockchain.The ERC20 token standard has been a predominant way to create ethereum based tokens in the cryptocurrency ecosystem for a while.

Presently, there are a number of unique tokens that have been distributed and are currently operating as per the ERC20 standard. Most of the ERC20 contracts are used for executing several functionalities and routines in digital space. A crypto related startup aiming to raise capital for project expansion would make use of the tokens as an exchange medium for the investments. Since its introduction, the ERC20 token standard single-handedly dominated the entire developer community for some time. This led to the integration of the ERC20 standard for several successful cryptocurrencies over the next few years. 

Importance of crypto tokens for ICO

Crypto tokens, for a brief period, are considered as a type of cryptocurrency which is used for representing an asset and it resides on their own blockchain. Crypto tokens are most commonly used for investments, storing value as well as to execute purchases. These tokens are distributed during an ICO (Initial Coin Offering) launch, representing the digital version of an Initial Public Offering (IPO). Newly emerging ventures looking to raise capital for their development will create tokens and issue them in exchange for their service or product offered. The interested investors are embraced by the company as they purchase these tokens as a part of the investment. 

The purchased tokens can be used for multiple purposes. They can be used for representing a stake in the company for trading or executing goods & service purchases. These tokens act as a liability for the investment made by the investors. Tokens are served as a compliment or rewarding factor for their support through investment. 

Popular token development blockchain (Ethereum)

The development of ERC20 tokens is carried out using the Ethereum blockchain. The infamous cryptocurrency cum blockchain Ethereum is based on the token usage that can be bought, sold or traded. Since its launch, Ethereum has become one of the prime influences behind the popularity of cryptocurrencies. As one of the most significant standards, ERC20 emerged as a basic technical standard that is implemented for every single smart contract over the Ethereum blockchain for token creation. 

Ethereum, being the underlying blockchain of the ERC20 token standard, has over 200,000 compatible tokens existing on its main network. The sheer importance of ERC20 requires special importance since it derives a common rule list for all Ethereum based tokens to adhere to. 

Ethereum Request for Comments (ERC):

The Ethereum Request for Comments (ERC) can be explained as technical documents integrated by smart contract developers at Ethereum. They are defined as a bunch of standards required for token implementation over the Ethereum ecosystem. These standards are normally created by the developers that involves information regarding the specifications of protocol and description of contracts. Before emerging as a standard, an ERC must be properly revised, commented as well as accepted by the community using an EIP (Ethereum Improvement Proposal). 

ERC token standard integrates an Application Programming Interface (API) for tokens inside the smart contracts. It facilitates functions like token transfers from one account to another for getting an account’s token balance and the total token supply of the available tokens on the network. This standard implemented by the Ethereum blockchain ensures interoperability of the crypto tokens over its platform for providing the protocol list to be followed for token implementation.

ERC20 token standard:

Ethereum, which acts as both cryptocurrency and blockchain system is based on the token usage which can be purchased, sold or traded. One of the most significant tokens based on the ethereum blockchain is the ERC20 token standard. Tokens created using the ERC20 standard are more or less similar to some of the cryptocurrencies like Bitcoin, Litecoin, etc. ERC20 tokens are common blockchain based assets that consist of a value which can be sent and received. The major difference is that ERC20 tokens are distributed over the Ethereum network instead of running on their own blockchain. 

The ERC20 token standard is necessary for ensuring compatibility between several tokens that are issued over the Ethereum blockchain. Most of the token developers have implemented the ERC20 rules as most of the tokens are released through Ethereum ICO. This means that most of the tokens that are released via Ethereum ICOs are compliant with ERC-20 standard. Having said that, there are some mandatory standards which are crucial to integrate with the ERC-20 standard. They are:

  • totalSupply – The totalSupply basically explains the overall count of ERC20 tokens that you wish to create.
  • approve – The approve attribute helps in segregating/eliminating counterfeit tokens. The function also checks if the number of tokens are correct when comparing with the total token supply.
  • balanceOf – This feature mainly acts as user information. Hence, if you initially possess some tokens and transfer it to other addresses, you can make use of this to check the number of tokens left.
  • transfer – This acts as a conventional crypto transaction over other blockchain platforms. Upon checking the available tokens, the owner is entitled to use this to send tokens to other addresses. 
  • transferFrom – This transfer attribute is for facilitating specific transactions. This function is used to carry out consistent payment routines. Hence, it is used for automating payments at a specific date and time.
  • allowance – Practically, when a contract wants to facilitate a transaction, it needs to see the balance of the Ethereum smart contract. By using this function, the contract can progress with the transaction or cancel them. 

Why should you choose ERC-20 standard

The usage of ERC20 token hit its peak due to its worldwide acceptance, usage as well as familiarity. The ERC20 token, like any other tokens, is highly suitable for the development of DApps. The usage of ERC20 tokens are extended through several platforms and also implemented for multiple purposes. Some of its varied benefits are as mentioned below:

Business benefits:

The ERC20 token basically serves as a speculative tool for the majority of the users as they are an integrated part of their individual ecosystems. This makes it fairly easy to bring in more use cases to the market for ERC20 tokens. This allows the developers and service providers to implement the token standard with great ease as well as with significant flexibility. They are used for creating subsidiary business beneficiaries in terms of new revenue generating aspects. They are:

1. Stablecoins:

An exciting use case involving the ERC20 token is the introduction of stablecoins. Since these currencies are related to a fiat currency value which experiences a rare change, they are vastly considered as a low-risk investment. Using this, developers can accurately specify multiple aspects using smart contract functions for altering the supply at their will. A stable coin can be commonly used for participating in Decentralized Finance (DeFi), purchasing goods & services and for exploring Dapps.

2. Security Tokens:

Security tokens can be considered as a unique breed of smart contract based ERC20 tokens. Despite sharing similar traits with stablecoins over the surface, there are major differences when it comes to implementation. This is mainly because security tokens are primarily not based on fiat currencies, instead they are backed by securities. The issuing company is entitled to tokenize stocks, physical assets or bonds using this token standard. In exchange for their investment, investors will be provided with stakes in the business which in return will pay the investors in dividends.

3. Utility Tokens:

One other primary category of ERC20 tokens is the creation of utility tokens. It is considered as a basic type of digital asset which isn’t backed by any tangible item. Rather, utility tokens are seen as rewards that provide unique benefits without having an external value.

The above mentioned are the most commonly used form of the ERC20 standard. They mostly serve as a revenue module from a business perspective. These benefits act as a provoking factor for creating ERC20 token standards. Most crypto enthusiasts would want to create ERC20 tokens upon exploiting its benefits. 

How to create ERC20 tokens?

The advent of cryptocurrency tokens proved to be a blessing in disguise in the midst of technology revolution. In that regard, the ERC20 token standard has made a significant impact among the crypto enthusiasts. However, the creation of ERC20 tokens requires a set of protocols to follow. Since ERC20 is regarded as a standard protocol for writing Ethereum smart contracts, it also defines a list of functionalities that needs to be implemented before executing any crypto crowdfunding platform.

There are basically two ways in which an ERC20 token can be created. The first method is to create a token all by yourself. But, in order to execute it, you should possess the necessary software skills, technical expertise and programming knowledge(solidity). This might prove to be too much for an individual to handle. In order to overcome this deterrence, it is highly advisable to develop a feature-filled ERC20 token through hiring a set of professional blockchain developers from a reputed ERC20 token development company from the current market. Hiring a pool of experts always gives you an edge over your competitors in terms of technical adaptation and deriving a high efficient output.

How acquiring technical assistance will help you?

The technical expertise that is required for creating an ERC20 token is quite monumental. The level of conceptual analysis that an ERC20 token demands is quite intriguing. In that regard, the implementation of smart contracts along with the created tokens can prove to be quite challenging from a technical perspective. The technology over which the tokens are created demands extensive programming skills from the developer. The blockchain technology that lies beneath the ERC20 token standard can come across as a tedious piece of technology to crack. The sheer in-depth research required to accomplish the creation without having to deal with any kind of hurdle is unparalleled to any other modern technology. The encryption protocol that provides a robust security feature comes with top-notch coding performance. 

The above mentioned technical requirements are quite tough to fulfill from a monotonous perspective. In order to experience these features to its full potential, one will need the assistance of some technical expertise. These expertise simply come from market experience. This is the main reason behind getting technical guidance for creating your tokens. The amount of experience and the quality of decision making depends on your sound knowledge in technical knacks. 

Why choose Zab technologies for creating ERC20 tokens? 

Zab Technologies is a well-established and prominent ERC20 token development company in the blockchain ecosystem. We are one of the veterans among the blockchain space and have an impeccable record in crafting crypto solutions, cryptocurrency token wallets, crypto tokens for most of the leading blockchains. We provide an entirely professional ERC20 token development service using which you can create your own ERC20 token in a cost-efficient manner. 

As of now, we have aided several cryptocurrency startups and entrepreneurs for creating cryptocurrency tokens over their desired blockchain platform. Adding to that, we have provided over 100 cryptocurrency related projects to our cherished clients across the globe. The highlighted part of our ERC20 token development service is providing all the necessary features that makes the token perform exceptionally. Therefore, in order to get the best professional guidance regarding developing ERC20 tokens, then make sure to get in touch with our team of experts.


The ERC20 token standard can be used to explain how versatile the Ethereum network pans out for developers as well as issuers. This environment is about much more than just transacting the Ethereum assets. It also provides sufficient customization as well as flexibility for unleashing and exploring fresh use cases that includes utility tokens, security tokens, etc.

Upon the introduction of Ethereum 2.0, the developers will be able to unravel new use cases, products and services due to improved scalability and data procession. Having said that, it is also possible that a new token standard will emerge to replace the ERC20 token eventually. Therefore, the future of Ethereum and its subsidiaries are poised to experience the new updates and exclusive features in the near future.

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I have started my career with Search Engine Optimisation and slowly concentrated on creative part as well. Now I'm working with a leading Blockchain Development Company in India - Zab Technologies

By Steve

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