This is the default API standard for creating and managing tokens within EVM-compatible smart contracts.
Tokens can represent virtually anything:
- reputation points in an online platform
- skills of a character in a game
- financial assets like a share in a company
- a fiat currency like USD
- an ounce of gold
Example functionalities the ERC-20 standard provides:
- transfer tokens from one account to another
- get the current token balance of an account
- get the total supply of the token available on the network
- approve whether an amount of token from an account can be spent by a third-party account
If a Smart Contract implements the following methods and events it can be called an ERC-20 Token Contract and, once deployed, it will be responsible to keep track of the created tokens onchain.
https://build.avax.network/docs/dapps/smart-contract-dev/erc-20-token
https://eips.ethereum.org/EIPS/eip-20
https://ethereum.org/en/developers/docs/standards/tokens/erc-20/