Should the ERC20 standard be improved? | Author: Dwayne D’cunha | The Capital | June 2021
These tokens can be issued for various purposes, from stocks to official or game currencies. The standard defines a set of rules governed by smart contracts, and every token on the network needs to follow these rules. A side benefit of this is that developers can evaluate the functionality of tokens released in the future. The ERC20 token standard can be easily published to any token, eliminating the time-consuming process of recreating it for other tokens.
This is different from NFTs because they are not fungible and because each token is not fungible, but for ERC20, each token has the same value (fungible) in the entire Ethereum ecosystem. Some good examples of popular ERC20 tokens are Chainlink, Binance, and Tether. In order to increase its various functions, it is compatible with wallets and exchanges without having to do other things, and it can transfer tokens from one account to another. Get the current token balance of the account and the total supply of tokens available on the network.
A key feature of the ERC20 standard is that it allows third-party accounts to use a specific number of tokens in the account. A well-known hacking incident eventually caused people to lose a total of 31,000,000 US dollars on July 20, 2017. Thanks to a group of white hat hackers, they were forced to take the money, but the hackers could not get the money, thus avoiding more losses. After that, they returned the ether they took to their respective owners. All this stems from Parity (Parity provides open source technology for the blockchain to help it expand) the default smart contract code for the client to initialize the multi-signature wallet. In short, they use codes to restore wallets and make themselves the owner of all these digital wallets, just like you use forgotten passwords on social media platforms. If you are worried, this problem was resolved soon after the incident. However, this does make people paranoid about another possible hacker who might use this small mistake in the future. This question reveals the unstable foundations that allow hackers to bypass the security of digital wallets. Except that the user sends the transaction to the smart contract without being recognized by other smart contracts, resulting in the loss of Ether. This also looks very unpleasant, and people may want to stay away from it.
Yes, there is a possible solution that looks promising, and it is called ERC777. This problem can be solved by a very counterintuitively inefficient process. ERC777 can come in handy because it uses operators that can transfer money in the name of the user. This not only provides its users with complete control, but also allows them to add attributes later. In addition to refusal to prevent the loss of the contract and address of the token. This does not deviate from the traditional function (ERC20 standard), it can still be used. The only downside is the sharp increase in gasoline costs, which is not a big problem when you compare it to the revenue.