How can the ERC-20 token baked by Bitcoin be useful?

What is an ERC-20 token?

The standard of ERC-20 token is backed by the Ethereum blockchain, similar in functionality to Bitcoin, Ethereum and Bitcoin Cash. These tokens can keep the value, as well as be sent and received by transferring from one wallet to another.

The main difference between ERC-20 tokens and other cryptocurrencies is that they are created and placed on the Ethereum blockchain, while Bitcoin and Bitcoin Cash are cryptocurrencies that represent the corresponding blockchains.

ERC-20 tokens are stored and sent using Ethereum addresses and transactions, and the transactions are made with gas. Gas is the internal currency used in the Ethereum network. Depending on the size and type of a transaction, a certain amount of gas is required for verifications and transaction confirmations in the Ethereum blockchain. Gas helps to measure the amount of work that miners must do to put transactions into a block.

SIMBA (the Simba.Storage token) is made on the basis of a smart contract based on the Ethereum ERC-20 blockchain while fiat stable coins such as USDT, TUSD, BUSD, PAX, USDC, ROX are centralized.

Why ERC-20?

The ERC-20 standard is aimed to improve the Ethereum network and to create assets on its blockchain. ERC is an acronym for Ethereum Request for Comment, and 20 is an offer identifier.

This standard forms a set of rules that all ERC-20 tokens must follow in order to freely interact with each other. All cryptocurrency exchanges and wallets support ERC-20, which simplifies the exchange of tokens and increases their liquidity.

In addition to exchanges and wallets, this standard provides access to additional services and interfaces reliability of various applications and extensions that support it. These utilities allow users to make instant transfers of their tokens and give smart contracts the ability to control the movement or distribution of tokens. Moreover, all actions have a high level of security and exceptional accuracy.

With the help of KYC process (identification of your personality), protection technologies of some platforms supporting ERC-20 allow users to recover assets even in case of loss to their wallets access or attempted unauthorized access. One of such platforms is Simba.Storage, which provides custodial storage services for Bitcoins.

ERC-20 empowers developers

ERC-20 is used for all smart contracts in the Ethereum blockchain to implement tokens.

The set of rules that are formed by the ERC-20 standard also allows developers to accurately understand how the tokens they create will function in the Ethereum system. Therefore, this standard simplifies the tasks faced by developers, because they will not have to make corrections to each new project when issuing tokens according to all the basic rules.

So far, the vast majority of token developers have fully complied with the ERC-20 rules which means that the majority of tokens issued on the Ethereum blockchain comply with the ERC-20 standard.

Examples of popular ERC-20 tokens

There are many popular ERC-20 tokens which serve a variety of purposes. Representatives of this standard are stablecoins, including the well-known USDT (ERC-20 standard), and ordinary cryptocurrencies of famous and interesting projects, for example, BAT — the Brave browser token or SIMBA — the stable storage coin Simba.Storage.

USDT is a stablecoin backed by the US dollar 1 to 1 (1 USDT = 1 USD). This means that the dollar is strictly pegged to this cryptocurrency. Therefore it is purchased to store funds, in which you do not need to think about the fall or growth of the cryptocurrency market. One of the ways to use USDT is trading on a cryptocurrency exchange. For example, you can fix your profits by exchanging an asset that has grown in value in USDT and then withdraw your funds using the exchanger or directly from the exchange, after exchanging USDT for rubles.

We should note that USDT is the stablecoin that is placed on several blockchains. In addition to ERC-20, there is also its own standard OMNI and TRC-20 (the standard of the Tron blockchain project). Therefore, you should be careful when making transfers of your USDT addresses that are used for USDT transfers of different standards . They are different and if you put the wrong one and make a transfer you can easily lose your money. However, the USDT ERC-20 is nowadays the most popular option due to cheap transfer fees and fast transactions.

By the way, do not be surprised if you see the same address on the exchange or wallet, both on USDT of the ERC-20 standard and on Ethereum This is another of the nice features of the ERC-20 standard: the technology itself identifies which cryptocurrency you transfer .

BAT (Basic Attention Token) is the token of the most popular Brave browser in the cryptocurrency community. Brave’s mission is to provide users with a safe, fast, and high-quality experience of content viewing while creating a new support system for content makers. In other words, users get a fast and secure browser with many built-in and accessible useful functions while the creators of digital content can get BAT tokens for their efforts and bypass any intermediaries.

SIMBA is the stablecoin ERC-20 backed by Bitcoin, 1 SIMBA = 1 Satoshi of a Bitcoin. Satoshi can be compared with euro cents or cents in dollars, this is a small part of a Bitcoin. There are 100,000,000 (one hundred million) Satoshi in one Bitcoin.

SIMBA is the first stablecoin in the world, with a 1 to 1 Satoshi ratio. This asset is issued in return for Bitcoins, which users leave for long-term storage in Simba.Storage. Since Bitcoin is the most profitable long-term cryptocurrency asset due to stable growth over many years, many users are interested in its reliable storage.

By transferring their BTC to the storage address, the SIMBA smart contract will issue the number of tokens corresponding to the number of deposited Bitcoins. As a result, your Bitcoins will be stored safely in cold wallets in Switzerland, and you will have SIMBA tokens that comply with the ERC-20 standard. These tokens can be used to pay for goods and services, cross-border transfers, loans and passive income.

Conclusion

As you can see, ERC-20 tokens can be helpful in various ways that help to provide services for transparent and reliable exchange, safe storage, conducting lightning-fast transactions, even rewards for content-makers and much more. In addition, the vast majority of cryptocurrency market exchanges work with it which allows it to maintain its liquidity.

You should especially pay attention to the ERC-20 tokens backed by Bitcoin. They are perfect for long-term storage as their price follows the annual BTC increase. One of these tokens is SIMBA from Simba.Storage which has barely any analogs. SIMBA tokens allow users to make all the necessary transactions quickly, safely and confidentially.