Blockchain Token Development Tutorial with Python — How to Create an ERC20?

 

Blockchain platforms are becoming more mainstream and a popular way for trading and commerce. The main factor that facilitates this trading comes in the form of tokens, specifically ERC20. These tokens act as a currency on the platform and can be created by anyone. In this short guide, let’s look at what ERC20 is and how you can create your token and deploy it on the blockchain.

 

Contents:

What Exactly Is an ERC20?

Function

Best Practices on the Blockchain

What Is the Role of ERC20 Tokens? Why Do We Need Them?

1. Establishing the grounds for a low-risk network
2. Governance
3. Ensuring that the blockchain has stable coins

How to Create & Deploy

 

What Exactly Is an ERC20?

ERC20 stands for Ethereum Request for Comment 20. Any idea about deploying a specific token is analyzed by a closed group of peers with this system. The Ethereum platform enables users to make suggestions that can be reviewed by others. This system has played a huge role in promoting its expansion.

The use of tokens on blockchain platforms such as Ethereum was made convenient by requesting comments. This led to the development of a standard of creating a token that became uniform across the chain.

 

Function

1. The ability to transfer a token from one user to another one
2. A balance off feature that enables you to check the amount of any token in the possession of an address
3. Enabling non-owners to move them from one end of the platform to another
4. Approving any transfer made between different individuals on the blockchain

 

Best Practices on the Blockchain

The following are some of the best examples to draw inspiration from:

• LINK
• DAI
• AAVE
• USDT

 

LINK for example is one of the more improved forms of the ERC20 tokens. Although it has a few extra features of its own, it still preserves other tokens’ basic nature, making it widely available on Ethereum.

 

What Is the Role of ERC20 Tokens? Why Do We Need Them?

What exactly is the purpose of an ERC20 token? We go through a long list of why you need one. However, a shortlist of the most notable reasons will suffice.

 

1. Establishing the grounds for a low-risk network

Volatile markets are not a stranger to blockchain platforms. Any asset can lose value if the market dictates and ERC20 helps to lessen the dependence of value on market volatility. This separation of an asset from the market makes it easy for you to follow the chain protocol and preserve your asset’s value.

 

2. Governance

If you want to play an important role like a protocol, ERC20 tokens have a feature that will help you do so. By voting, you can hold a stake.  

 

3. Ensuring that the blockchain has stable coins

ERC20 tokens also enable users to preserve the value of the assets that might not be connected to the blockchain. This is made possible by creating synthetic assets. These create a connection to off-chain market trading and as such users have some collateral assets. Stablecoins work with the same principle, representing assets of stability e.g the USD.

 

How to Create & Deploy

Now that you have a good idea of what ERC20 is and what it can do for you, let's look at how you can create one:

• Make sure you already have Python installed and ready to be used. A smart deployment system called Brownie will also be essential, make sure you have it as well.
• Further, access the contract folder first. Here, you will notice two distinct ones. The first is called EasyToken.sol and the other is TokenERC20.sol. The later format is a simple case of how you can create a contract for yourself from scratch. If you choose to do so, just take the necessary measure to all the required functions.

 

• Another more user-friendly method makes use of the OpenZeppelin package. With this, the contract generated simply takes on all the necessary functions required for implementation. All you have to take care of is the naming of the token, provide a symbol, and the first supply.
• When working with Solidity you will notice that decimals are not used in numeration. To work around this use additional zeros for you to quantify fractions of your token. Once you figure this out the token will be created and you can begin the groundwork to get it deployed to the blockchain platform.

 

Deploying the token is made possible by using Brownie. Remember that Brownie has to be connected to a blockchain for your coin to be deployed. The platform it is deployed to depends on what chain your Brownie is currently connected to. You can also make multiple deployments on various platforms if that’s what you are going for.

 

Now, you have a good understanding of what an ERC20 is and what it can do for you. The next step is implementing this knowledge and creating something that can stand out and take blockchain commerce to the next level. You can use the Finage service and reach market data to start your successful business!

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