What Are ERC20 Tokens?

An ERC20 token is a type of crypto that is built on the back of the Ethereum blockchain through a smart contract. If you have ever heard of Shiba Inu & the Basic Attention Tokens then these are both ERC20 tokens. These tokens are deployed through a smart contract, so they use the Ethereum blockchain to make trades, sales and purchases.

ERC20 Crypto Toeksn Explained
ERC20 Crypto Toeksn Explained

Important Point: ERC20 tokens are backed by the Ethereum blockchain and deployed using Ethereum as liquidity. You must also use Ethereum to purchase any ERC20 token, unless you already own one of the many ERC20 tokens then you can swap one for another, but will need to pay the gas fees in Ethereum. No wonder Ethereum is making huge grounds, with no accountability!

Token Scam Talk

All gas fees are paid in Ethereum, so the Ethereum blockchain are making vast sums of funds by allowing these token to be deplyed on the back of their blockchain. Yes, the Ethereum blockchain is secure and fast, but the fees are extrememly high when compared to other blockchains.

How To Create An ERC20 Token

Anyone can create an ERC20 token on the back of the Ethereum blockchain. All you need to do is create/write a contract and deploy it onto the Ethereum blockchain. It is that simple, there are codes to simply copy and paste and websites that do this for you.

It takes about 10 minutes to set up and deploy a smart contract. All you need to do is pay the deploy fee and add liquidity in Ethereum and you can start pumping and shilling your Erc20 token.

  • Write a contract or copy one of the many ready-made contracts
  • Deploy the contract onto the Ethereum blockchain
  • Add liquidity and start trading
  • It is that simple and the process takes about 15-20 minutes

Are ERC20 Tokens Safe?

If you are a beginner and wanted to start trading ERC20 tokens then I would say no, this is because scams have become the norm on this blockchain. There are so many copy tokens made to look legitimate, rug pulls and many honey pots. You need to know what to look out for when trading ERC20 tokens.

  • High chance of scams
  • Only trade well-known tokens

You need to be vigilant because at any moment investors will drop their liquidity/funds and there will be a run on your invested ERC20 token. An ERC20 token is not built for hodling because it’s really a bad savings club where all investors have shaky hands and could withdraw their liquidity at any moment.

These tokens are not for the faint-hearted and you will probably lose your investment sooner rather than later!

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