Differences and advantages and disadvantages comparison between XRC20 and ERC20

The popularity of Bitcoin Inscription has spread to all major public chains. OKX Wallet, the mainstream wallet of Inscription, has also taken advantage of it recently. For example, the price of OKT, the native token on OKTChain, has risen sharply, once reaching US$38.88. This is all related to the casting of OKTS Inscription. Relatedly, OKTS Inscription is the first token on the OKTChain chain and follows the XRC20 protocol. Speaking of XRC20, we have to mention another inscription standard ERC20. ERC20 is defined by the core developers of Ethereum to propose, discuss and implement different technologies for creating tokens, smart contracts, applications, wallet formats, etc. on Ethereum. standard. For investors, they would like to know more about the difference between XRC20 and ERC20, both of which are inscriptions? The difference mainly lies in blockchain, smart contracts, etc. The editor will explain it in detail below.

What is the difference between XRC20 and ERC20?

XRC-20 and ERC-20 are token standards on two different blockchains, corresponding to XRPL and Ethereum respectively. The main differences between them include the blockchain, smart contracts, functionality and development ecosystem they are on.

1. Blockchain

XRC-20 is the token standard on XRPL. XRPL is the abbreviation of XRP Ledger, which is a decentralized distributed ledger related to Ripple.

ERC-20 is the token standard on Ethereum. Ethereum is a blockchain that supports smart contracts, allowing developers to create and deploy smart contracts.

2. Smart contracts

XRPL does not support smart contracts, unlike Ethereum. Therefore, XRC-20 tokens are not created through smart contracts, but through specific transactions on the ledger on XRPL.

ERC-20 tokens are created on Ethereum through smart contracts that comply with the ERC-20 standard.

3. Functional differences

Since XRPL does not support smart contracts, XRC-20 may have some functional limitations.

ERC-20 can achieve richer functions through smart contracts.

4. Development and Ecosystem

ERC-20 is one of the most widely used token standards to date, with a rich ecosystem and a lot of support. XRC-20 may be relatively new and the ecosystem is small.

Which one is better, XRC20 or ERC20?

Choosing to use XRC-20 or ERC-20 depends on your specific needs, the goals of the project, and the technical and ecosystem considerations you face.

1. Situation when choosing XRC-20:

If the project is built on XRPL, then XRC-20 may be more suitable because it is the token standard on XRPL.

If your token does not require smart contract functionality, and XRPL does not support smart contracts, then XRC-20 may be a suitable choice.

If you hope to integrate or cooperate with other projects in the Ripple ecosystem, choosing XRC-20 will help you better integrate into the ecosystem.

2. Situation when choosing ERC-20:

If your project is built on Ethereum, then ERC-20 is a natural choice because it is the most common and Widely used token standard.

If your token requires smart contract functionality, such as automatically executing operations under specific conditions, then ERC-20 provides such support.

The Ethereum ecosystem is very rich, with a large number of developers, tools and support. ERC-20 tokens are easier to find support and applications in the Ethereum ecosystem.

Most decentralized financial applications (DeFi) and smart contract platforms are based on Ethereum, so if you want to participate in the DeFi ecosystem, it is more appropriate to choose ERC-20 tokens.

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