erc in crypto

What Is ERC?

ERC stands for Ethereum Request for Comments. It is a set of technical standards that define how smart contracts should interact on the Ethereum blockchain. ERCs specify the required functions and events that smart contracts must implement, enabling wallets, exchanges, and decentralized applications (DApps) to communicate with contracts in a consistent manner.

A smart contract is essentially a program deployed on the blockchain that executes automatically based on predefined rules. ERCs serve as "interface standards" for these programs—for example, mandating a transfer function for token transfers or a Transfer event for transaction logging. Because interfaces are standardized, wallets and exchanges can integrate new tokens efficiently without custom development for each one.

Relationship Between ERC and EIP

ERCs originate from EIPs (Ethereum Improvement Proposals), but they are not the same. An EIP is a broader proposal that collects suggestions ranging from protocol changes to application-level improvements across the Ethereum ecosystem. ERCs are a subset of EIPs focused specifically on application and contract interaction standards—essentially, how interfaces should be written.

Think of EIPs as a master catalog of proposals, with ERCs being entries dedicated to application interfaces. Typically, an ERC undergoes drafting, community discussion, review, and finalization. Once the specification stabilizes, developers implement it, wallets and exchanges provide support, and the standard becomes widely adopted within the ecosystem.

What Does ERC-20 Mean?

ERC-20 is the standard interface for fungible tokens—tokens where each unit is identical and interchangeable (e.g., stablecoins or governance tokens). The ERC-20 standard defines functions like balanceOf, transfer, approve, and allowance, as well as events such as Transfer and Approval.

In practice, stablecoins like USDT on Ethereum adhere to the ERC-20 standard. When users initiate transfers via wallets or exchanges, the transfer function is called; when authorizing DApps (like decentralized exchanges), approve and allowance are used.

On exchange deposit pages, the Ethereum mainnet is often labeled as "ERC-20" or "ERC (Ethereum)," indicating the token address format and transfer method follow the ERC-20 specification.

What Is the Difference Between ERC-721 and ERC-1155?

Both standards relate to non-fungible tokens (NFTs), but serve different purposes. ERC-721 defines non-fungible tokens, where each token has a unique ID—similar to digital collectibles or certificates. ERC-1155 is a multi-token standard supporting both fungible and non-fungible assets, allowing multiple token IDs to be managed within a single contract and enabling efficient batch transfers.

For example, a digital artwork can be represented as an ERC-721 token, with each Token ID linked to a unique piece. In gaming, assets like equipment (non-fungible) and stackable materials (fungible) can both be managed in one ERC-1155 contract. Batch transfers save on transaction fees and increase efficiency.

How Are ERC Standards Proposed and Adopted?

The typical process for an ERC standard becoming widely adopted includes:

1. Drafting: The author writes an EIP document targeting an application interface standard (i.e., an ERC).
2. Community Discussion: Feedback is gathered from wallets, exchanges, and developers regarding required functions, events, error handling, and compatibility.
3. Reference Implementation & Testing: Example code and test cases are provided to demonstrate feasibility and interoperability.
4. Finalization: Once the specification stabilizes, projects begin implementing and integrating the standard, leading to widespread adoption.

ERCs that are widely used, well-supported by tooling, and reduce integration costs are more likely to become mainstream.

How to Choose the ERC Network When Depositing on Exchanges

Selecting the "ERC network" ensures that your sending (origin) and receiving (destination) blockchains match. Similar-looking addresses do not guarantee they are on the same blockchain.

Steps:

1. On Gate, select your token and navigate to the deposit page. Check if "ERC-20 (Ethereum)" or "ERC (Ethereum)" is listed as a network option.
2. On your withdrawal platform, ensure that its withdrawal network exactly matches Gate’s deposit network—for example, both must be "ERC-20."
3. Copy the deposit address provided by Gate. Note that an address starting with "0x" only indicates it follows Ethereum-style formatting—not necessarily that it is on Ethereum mainnet.
4. Test with a small deposit first. Once confirmed, proceed with larger transactions to avoid irreversible losses due to network mismatches.

A common mistake is confusing other EVM-compatible chains (which also use 0x addresses) with Ethereum mainnet—for instance, sending assets from a sidechain to an Ethereum address. Always match by "network name," not just address appearance.

How Can Developers Implement ERC Interfaces in Contracts?

To implement an ERC interface correctly, developers must provide all required functions, events, and return values as specified in the standard—and use reputable libraries for security and compatibility.

Steps:

1. Use Established Libraries: Most developers rely on OpenZeppelin libraries to inherit base contracts like ERC20, ERC721, or ERC1155, reducing security and compatibility risks.
2. Add Required Metadata: For ERC-20, set the name, symbol, and decimals; for ERC-721/1155, implement metadata and URI callbacks so wallets can display information correctly.
3. Enforce Permissions & Security: Apply the principle of least privilege; avoid unlimited minting; carefully handle transfer hooks and external calls to mitigate reentrancy and other risks.
4. Testing & Verification: Use Ethereum development tools like Hardhat for unit testing; after deployment, verify source code on blockchain explorers for transparency.

Optional enhancements include implementing permit-style signature approvals—allowing users to authorize transactions off-chain with signatures to save on gas fees.

Common Risks Associated With ERC Standards

Both users and developers face risks related to ERC standards:

• Network Selection Errors: Mistaking other 0x-based chains for Ethereum mainnet can result in failed deposits or lost funds. Always align networks as specified on deposit and withdrawal pages.
• Name Confusion: Token names and symbols are not unique—always verify contract addresses on block explorers to avoid adding counterfeit tokens.
• Authorization Risks: Granting large approve allowances in DApps can expose funds if the DApp is compromised. Regularly review and revoke unnecessary approvals in your wallet or exchange account.
• Decimal & Precision Issues: Different ERC-20 tokens use different decimal places—handle amounts per contract responses to avoid display errors during integration.
• Upgradeable Contract Risks: Improperly managed proxy-based ERC tokens can introduce new permissions or vulnerabilities when upgraded. Monitor project disclosures about proxy/admin controls.

When dealing with funds: always test with small amounts first, double-check networks and contract addresses, and rely on official sources for information.

Are There Comparable Standards Beyond ERC?

Other blockchains have similar interface standards:

• BNB Chain uses BEP-20 (similar to ERC-20)
• Tron uses TRC-20
• Solana employs SPL token standards for its account model

Many Ethereum Layer 2 networks also use ERC interfaces but are distinct networks with their own chain IDs.

Key comparison points: Interfaces may look similar but networks are independent; addresses may look alike but always match by "network name." Cross-chain bridges map assets between networks by issuing corresponding "wrapped tokens"—the underlying network standard does not change.

Summary: Key Points About ERC

ERCs are interface standards at the application layer of Ethereum designed to enable seamless interaction among smart contracts, wallets, exchanges, and DApps under a unified protocol. ERC-20 covers fungible tokens; ERC-721 and ERC-1155 cover NFTs and multi-token models. ERCs arise from the EIP process and become de facto standards through widespread adoption and ecosystem support.

For users: Always match deposit/withdrawal networks when transacting. For developers: Adhere to established implementations and security best practices. For risk management: Beware of network mismatches, excessive token approvals, and improper contract permissions.

These principles form the core pathway to understanding and utilizing ERC standards effectively.

FAQ

Why Are There Different Standards Like ERC-20 and ERC-721?

Different ERC standards address different application needs. ERC-20 is for fungible tokens (such as stablecoins or governance tokens), where every unit is identical; ERC-721 is for non-fungible tokens (NFTs), where each token is unique; ERC-1155 combines both functionalities by supporting multiple token types within a single contract. The choice depends on your asset’s characteristics.

My USDT Is an ERC-20 Token—Can I Send It Directly to a Friend?

Yes—but make sure your friend’s wallet supports the ERC-20 standard. If their wallet only supports TRC-20 or another blockchain, sending directly may result in lost funds. Always confirm which blockchain your friend uses or transfer via exchanges like Gate that automatically recognize receiving addresses.

Why Do I Need to Pay Gas Fees for ERC-20 Transfers?

ERC-20 tokens operate on the Ethereum blockchain. All transactions require validation by miners or validators who are compensated via gas fees for computational resources consumed. When network traffic is high (gas fees), costs increase—transferring during off-peak times (such as late night UTC+8) can help save on fees.

I Bought an ERC-20 Token on an Exchange but My Wallet Does Not Support It—What Should I Do?

You have two options: switch to a wallet that supports ERC-20 tokens (like MetaMask or imToken), or keep your assets on the exchange without withdrawing them. If your exchange offers multi-chain withdrawals, you may also choose another network (such as withdrawing TRC-20 tokens to a Tron wallet)—just be mindful of different gas fees and transfer times.

Are New ERC Standards Going to Affect My Existing Tokens?

No. New standards (like ERC-4626 or ERC-6551) are designed for new features or use cases; existing tokens continue operating under their original standards. If a project decides to upgrade its contract standard, you will be notified in advance so you can choose whether to participate or opt out. In general, backward compatibility is strong—there’s no need for concern about forced changes.