An ERC-20 token is a token issued through an Ethereum smart contract that follows the ERC-20 standard interface. The standard gives compatible software a shared way to ask about balances, supply and transfers.
ERC-20 is a technical standard. It is not an approval, audit, quality mark or statement about value.
What ERC-20 means
ERC stands for Ethereum Request for Comments. ERC-20 is a published standard for a token interface in smart contracts. The specification describes basic functions for a token, including checking total supply and an account balance, and recording transfers.
When different tokens follow the same interface, software can interact with them in a more consistent way. That consistency is the main point of the standard.
Fungible token units
ERC-20 is commonly used for fungible tokens. Fungible means that units of the same token type are interchangeable with one another. It is different from a non-fungible-token standard, where a token identifier can distinguish one token from another.
Names, symbols and decimals
The ERC-20 specification includes optional functions for a token name, symbol and decimals. Optional is an important word here: compatible software must not assume those fields are present. A name or ticker shown in an interface is not evidence of authenticity, ownership, value or safety.
What ERC-20 does not guarantee
A token can follow an interface and still raise questions outside that interface. The standard does not check whether a project is genuine, whether claims made about it are accurate, whether code has been reviewed or whether a token is suitable for anyone.
Ethereum’s own ERC-20 documentation also notes that implementation details and limitations matter. A standard describes an interface; it does not remove the need to understand the particular system and its claims.
For the broader distinction, see Crypto explained. Related terms are defined in the crypto glossary.
Sources and scope
Sources: ERC-20: Token Standard and Ethereum.org’s ERC-20 explanation. This page explains a technical term and is not financial, tax or legal advice. Source check: 15 September 2026. Corrections: contact The Coin Expert.