ERC-20 VS XRC-20 What Is the Best Blockchain Token Standard?
You’re probably wondering why some coins have the “ERC20” tag and some are “XRC-20.” Are there any differences in the coin values? Which will be better for you to use? Who wins in the XRC20 vs. ERC20 battle?
XRC20 and ERC20 are basically token standards. This article will break down everything you need to know about ERC20 and XRC20 token standards and how you can use them. Let’s get into it.
What is a Token Standard?
A token is a cryptocurrency that is built on an existing blockchain. These coins are usually built by companies that want to use them for specific purposes. But, instead of building their own blockchains, they simply find existing chains to build on.
Some of the functions of crypto tokens can include:
- Processing transactions
- Acting as a store of value
- Buying assets on an online platform
- Voting on a decentralized application (dApp)
- Crowdfunding and raising money
Take XDC for example. XDC is the native token for XinFin XDC Network. Since Comtech Gold doesn’t have its own blockchain, Comtech Gold Team launched $CGO on the XinFin XDC network instead.
Every year, hundreds of dApps launch their tokens on different blockchains — like Ethereum and the XinFin XDC network. But, for these tokens to work perfectly with the blockchains, they need to follow specific guidelines. These guidelines are what we call token standards.
- The token’s total supply
- The process of making and destroying new tokens
- The token’s transaction processes, etc.
These standards help to avoid fraud, technical failures, and other issues.
The ERC20 Token Standard
The ERC20 token standard is a set of rules that guides projects looking to build on the Ethereum blockchain. You need to follow the ERC20 token standard if you want to create a smart contract on the Ethereum blockchain. Then, you can use these smart contracts to create your own token.
The Ethereum blockchain is the most popular blockchain for developing dApps, and the ERC20 token standard is the most popular token standard on the chain.
Core Features of the ERC20 Token Standard
Every ERC20 token has several important features. The main elements are:
- totalSupply: A feature that shows the total supply of the ERC20 token
- balanceOf: This feature shows the number of tokens held in a specific wallet
- Transfer: The feature enables tokens to be transferred from one user to the other
- transferFrom: This function automates transfers by approved people or contracts. So,
- you don’t have to make some payments manually
- approve: Limits the number of tokens that a smart contract can withdraw from your balance.
- name: This is used to attach a name to a token (for instance, “Tether”)
- symbol: This is used to attach symbols to tokens (for instance, “USDT”)
- decimal: Sets the number of decimal places that a token can be divided into
ERC20 vs. XRC20: Understanding the Difference
The following factors will help you clearly understand the key difference between BEP20 and XRC20 tokens:
XRC20 is a clear winner over ERC20 when it comes to gas fees. Due to XinFin XDPoS XinFin Delegated proof of stake) block validation method, the transaction fee for the XRC20 token is much lower than ERC20. The average transaction fee charged by ERC20 is around $12 whereas XRC20 tokens don’t cost more than a few cents at the time of transaction. The intrinsic value of Ethereum is much higher than XinFin. While carrying out transactions using ERC20 tokens, users have to pay the gas fees in Ethereum and find it a bit costlier when compared to XRC20.
Block Verification Speed
Transaction speed or Block verification speed for both ERC20 and BEP20 tokens varies largely. The XDPoS block validation method gives XRC20 transactions a faster execution speed as compared to transactions conducted through ERC20. The average block verification speed on the underlying Blockchains is approximately 2 seconds for XinFin and close to 15 seconds for Ethereum. Though Ethereum is planning to move from Proof of Work to Proof of Stake in the coming days, the execution time for ERC20 transactions may reduce to a greater extent.
XRC-20 tokens offer benefits such as faster transaction speed and lower gas fees, the XinFin XDPoS block validation model has received a lot of popularity due to its potential security as all the masternode on XDC Network are KYC enable masternode For block verification, XDC Network relies on 108 core KYC enable masternode whereas Ethereum has over 70,000 validators distributed across the network.
To conclude, one can easily understand that XRC20 tokens offer faster execution time and superior gas fees at the expense of security.
In the current scenario, ERC20 tokens are enjoying greater attention due to Ethereum’s popularity. However, XRC20 will surely catch up with ERC20 in the future due to its speed affordability, and security.
If you’re looking to create an XRC-20 token with a few clicks check out https://origin.xdc.org and want to migrate from Ethereum to XDC Network in just 20 minutes check out a step-by-step guide https://ruslanwing100.medium.com/how-to-migrate-any-ethereum-token-to-xinfin-network-is-less-than-10-minutes-43f9c78aada2