ERC-20 Token: What It Is, How It Works, and Why It Dominates Crypto

When you hear about tokens like ERC-20 token, a technical standard for fungible tokens on the Ethereum blockchain. Also known as Ethereum token standard, it lets anyone create a digital asset that works across wallets, exchanges, and apps without reinventing the wheel. This isn’t just a tech detail—it’s why over 90% of new crypto projects launch on Ethereum. If a token can be bought on Uniswap, claimed in an airdrop, or used in a DeFi protocol, it’s almost certainly an ERC-20 token.

Behind every ERC-20 token is a smart contract, a self-executing code on the Ethereum network that defines how the token behaves. It handles things like total supply, who can send or receive it, and how balances are tracked. That’s why you can send a token like STON or MDX to any wallet and it just works—because every wallet understands the same rules. But here’s the catch: just because a token follows ERC-20 doesn’t mean it’s real. Look at DDM, UniWorld, or Bitstar—these are fake tokens that copy the standard to look legitimate. The standard doesn’t guarantee value. It just makes it easier to build scams… or real projects.

ERC-20 tokens are the reason you see so many airdrops, gaming coins, and DeFi tokens on Ethereum. Projects like STON.fi and MAGICK use it because they don’t need to build their own blockchain—they can plug into Ethereum’s ecosystem. But this also means they inherit Ethereum’s fees, delays, and congestion. That’s why some newer chains like TON or BSC have their own versions of ERC-20—faster, cheaper, but still built on the same idea. The real question isn’t whether a token is ERC-20. It’s whether the team behind it is real, whether the token has actual use, and whether anyone’s using it beyond a price chart.

You’ll find posts here about fake ERC-20 tokens pretending to be stablecoins, dead projects with zero trading volume, and real ones like STON that actually power a growing user base. Some of these tokens are scams. Others are just poorly built. A few might be ahead of their time. But they all run on the same foundation. Understanding ERC-20 isn’t about learning code—it’s about knowing what to look for when a new token pops up. Is it just another copy-paste job? Or does it solve something real? The answer starts with the standard—and ends with the people behind it.