# What Are the Key Functions Defined in the ERC-20 Standard? ⎊ Path

**Published:** 2025-12-04
**Author:** Greeks.live
**Categories:** Path

---

## What Are the Key Functions Defined in the ERC-20 Standard?

The ERC-20 standard defines a set of six mandatory functions that a compliant smart contract must implement. These include totalSupply() to get the total number of tokens, balanceOf() to get a user's balance, and transfer() to send tokens to another address.

It also includes approve() and transferFrom() which allow a user to authorize another contract to spend tokens on their behalf. The allowance() function checks how many tokens a spender is allowed to withdraw from an owner's account.

These functions ensure all ERC-20 tokens behave in a predictable way.

- [How Does a Token Standard like ERC-20 Differ from ERC-721?](https://learn.greeks.live/path/how-does-a-token-standard-like-erc-20-differ-from-erc-721/)

- [What Are the Key Differences between ERC-721 and the Newer ERC-1155 Standard?](https://learn.greeks.live/path/what-are-the-key-differences-between-erc-721-and-the-newer-erc-1155-standard/)

- [How Does ERC-1155 Improve Gas Efficiency over ERC-20 and ERC-721?](https://learn.greeks.live/path/how-does-erc-1155-improve-gas-efficiency-over-erc-20-and-erc-721/)

- [Why Is a Two-Step Approve and Transferfrom Process Often Cheaper in the Long Run for Frequent Interactions?](https://learn.greeks.live/path/why-is-a-two-step-approve-and-transferfrom-process-often-cheaper-in-the-long-run-for-frequent-interactions/)

- [What Is the Purpose of the “Approve” Function in the ERC-20 Standard?](https://learn.greeks.live/path/what-is-the-purpose-of-the-approve-function-in-the-erc-20-standard/)

- [What Is the Transferfrom() Function and How Does It Relate to Approve() ?](https://learn.greeks.live/path/what-is-the-transferfrom-function-and-how-does-it-relate-to-approve/)

- [What Is the Role of the ERC-20 Standard’s Approve() Function in Setting a Token Allowance?](https://learn.greeks.live/path/what-is-the-role-of-the-erc-20-standards-approve-function-in-setting-a-token-allowance/)

- [How Do Lending Protocols Utilize ERC-20 Standards for Collateral?](https://learn.greeks.live/path/how-do-lending-protocols-utilize-erc-20-standards-for-collateral/)

## Glossar

### [ERC-20 Standard](https://learn.greeks.live/area/erc-20-standard/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Token ⎊ The ERC-20 standard, formally defined within Ethereum Improvement Proposal (EIP)-20, establishes a framework for fungible tokens on the Ethereum blockchain.

### [Erc-20](https://learn.greeks.live/area/erc-20/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Architecture ⎊ The ERC-20 standard defines a uniform API for fungible tokens on the Ethereum blockchain, facilitating interoperability between decentralized applications and exchanges.

### [Erc-20 Tokens](https://learn.greeks.live/area/erc-20-tokens/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Standard ⎊ ERC-20 tokens represent a technical standard implemented via smart contracts on the Ethereum blockchain, defining a common set of rules for fungible digital assets.

## Discover More

### [How Does the ERC-1155 Standard Specifically Enable the SFT Structure for Financial Instruments?](https://learn.greeks.live/path/how-does-the-erc-1155-standard-specifically-enable-the-sft-structure-for-financial-instruments/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the ERC-1155 Standard Specifically Enable the SFT Structure for Financial Instruments?](https://learn.greeks.live/wp-content/uploads/2025/10/Tangible-Manifestation-of-Tokenized-Asset-Allocation-Within-High-Frequency-Trading-Architecture.webp)

ERC-1155's multiple token ID capability within one contract allows for distinct, yet fungible, financial tranches.

### [What Is the Standard Overbought and Oversold Range for the RSI Indicator?](https://learn.greeks.live/path/what-is-the-standard-overbought-and-oversold-range-for-the-rsi-indicator/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Standard Overbought and Oversold Range for the RSI Indicator?](https://learn.greeks.live/wp-content/uploads/2025/10/Beige-Monolithic-Haptic-Interface-Device-Representing-Decentralized-Autonomous-Organization-Governance-Mechanisms.webp)

Above 70 is overbought, suggesting overvaluation; below 30 is oversold, suggesting undervaluation.

### [What Are the Primary Functions of Governance Tokens in a DAO's Financial Structure?](https://learn.greeks.live/path/what-are-the-primary-functions-of-governance-tokens-in-a-daos-financial-structure/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Are the Primary Functions of Governance Tokens in a DAO's Financial Structure?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Autonomous-Organization-Governance-Mechanism-Token-Allocation-Structure-Abstract-Visualization.webp)

Governance tokens grant voting power on DAO proposals and represent a financial stake in the organization's success.

### [What Is the Concept of "Fractionalization" for ERC-721 Assets?](https://learn.greeks.live/path/what-is-the-concept-of-fractionalization-for-erc-721-assets/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Concept of "Fractionalization" for ERC-721 Assets?](https://learn.greeks.live/wp-content/uploads/2025/10/Asymmetric-Interlocking-Struts-Approaching-Liquidity-Pool-Horizon-In-Digital-Asset-Contracts.webp)

Splitting a single, high-value ERC-721 into multiple, fungible ERC-20 tokens to increase accessibility and liquidity.

### [How Do Tokenized Securities Leverage the Fungible Standard While Adhering to Fractional Ownership Rules?](https://learn.greeks.live/path/how-do-tokenized-securities-leverage-the-fungible-standard-while-adhering-to-fractional-ownership-rules/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Do Tokenized Securities Leverage the Fungible Standard While Adhering to Fractional Ownership Rules?](https://learn.greeks.live/wp-content/uploads/2025/10/Microcosm-of-Decentralized-Autonomous-Organization-Governance-Mechanism-Through-Glimmering-Option-Expiration-Interfaces.webp)

Fungible tokens represent equal fractional claims on a larger security, with the smart contract managing ownership and distributions.

### [How Do Oracle Services Interact with ERC-20 Tokens in Derivative Protocols?](https://learn.greeks.live/path/how-do-oracle-services-interact-with-erc-20-tokens-in-derivative-protocols/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Do Oracle Services Interact with ERC-20 Tokens in Derivative Protocols?](https://learn.greeks.live/wp-content/uploads/2025/10/Quantum-Entanglement-Probe-Vector-Penetrating-Composite-Structure-Signaling-Decentralized-Exchange-Futures.webp)

Oracles feed real-world price data of ERC-20 tokens to smart contracts, enabling liquidations and settlement calculations.

### [How Is the 'User' Defined Differently in Various Applications of Metcalfe's Law to Crypto?](https://learn.greeks.live/path/how-is-the-user-defined-differently-in-various-applications-of-metcalfes-law-to-crypto/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Is the 'User' Defined Differently in Various Applications of Metcalfe's Law to Crypto?](https://learn.greeks.live/wp-content/uploads/2025/10/Conceptual-Visualization-of-High-Frequency-Algorithmic-Crypto-Derivative-Execution-through-Spreads.webp)

'User' can mean unique addresses, active addresses, developers, or nodes; active addresses is often the best proxy.

### [How Does a Token Standard like ERC-20 Fundamentally Differ from an NFT Standard like ERC-721?](https://learn.greeks.live/path/how-does-a-token-standard-like-erc-20-fundamentally-differ-from-an-nft-standard-like-erc-721/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does a Token Standard like ERC-20 Fundamentally Differ from an NFT Standard like ERC-721?](https://learn.greeks.live/wp-content/uploads/2025/10/Bifurcated-Tokenized-Asset-Mechanism-Revealing-Underlying-Collateralized-Derivatives-Structure.webp)

ERC-20 tokens are interchangeable (fungible), while ERC-721 tokens are unique (non-fungible).

### [Can a Covered Put Be Considered a Defined-Risk Trade?](https://learn.greeks.live/path/can-a-covered-put-be-considered-a-defined-risk-trade/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Can a Covered Put Be Considered a Defined-Risk Trade?](https://learn.greeks.live/wp-content/uploads/2025/10/Macro-Cosmovision-of-a-Cyan-Hydrophilic-Arbiter-Balancing-Speculative-Hedging-Mechanisms.webp)

Yes, a cash-secured put has a defined maximum loss, capped at the strike price minus the premium received.

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