ERC-20

ERC-20 is the Ethereum Improvement Proposal that defines a standard interface for fungible tokens — every unit is identical and interchangeable, just like dollars in a bank account. Any contract implementing ERC-20's transfer, approve, and allowance functions is automatically compatible with wallets, exchanges, and DeFi protocols without custom integration. Stablecoins like USDC and USDT are ERC-20 tokens, as are most governance and utility tokens. ERC-20 contrasts sharply with ERC-721: an ERC-721 token is non-fungible — each one has a unique ID representing a distinct asset, like a specific domain name.