The ERC20 standards have been put in place so that all Ethereum tokens follow a particular rule and standard. While this is not an enforced rule, most DAPP developers are encouraged to follow the standards to ensure that their tokens can undergo interactions with various wallets, exchanges and smart contracts without any issues.
These standards also helped others gain an idea of how future tokens are expected to behave. ERC20 tokens have gotten widespread approval and most of the DAPPS sold on ICO’s have tokens based on the ERC20 standard. So what are these standards?
They are basically a set of 6 functions which, when executed, do the following 4 activities:
Get the total token supply.
Get the account balance.
Transfer the token from one account to another.
Use the token as an asset.