“WHY WON’T MY ERC-20 TOKEN TRANSACTION GO THROUGH?”
Insufficient Funds For Gas
While we’ve answered this question in previous videos (you need ether to send ERC-20 tokens), there a still a lot of users yet to become familiar with crypto that will likely be confused by this requirement.
To address this problem, an ERC (Ethereum Request for Comment) has gained traction. It seeks to eliminate this problem. The suggestion seems simple, but the workings behind it are a little more complex: allow users to pay for gas, the unit needed to run transactions on the Ethereum network, in any ERC-20 token.
With the current Ethereum ecosystem, gas must be purchased with ether. So if you are trying to transfer an ERC-20 token, such as Basic Attention Token, you need a small balance of ether to purchase the gas required to execute the transaction. If you don’t have ether in your wallet, you can’t pay gas. Even though you’re not transferring ether.
As you can see, this requirement can be quite confusing. And that’s where ERC-865 comes in. Simply, the ERC proposes a change where gas can be bought with ERC-20 tokens.
Some of you more familiar with Ethereum might realize that buying gas with anything other than ether could be very detrimental to the network. Ethereum was set up in some very specific ways, and a core tenet of the ecosystem is the requirement gas be bought with only ether.
Don’t fret Ethereum enthusiasts! The requirement that gas is bought with only ether is not going anywhere. ERC-865 just gives the appearance that tokens are used to buy gas, but there’s really more going on behind the scenes.
“It’s About Building An Easy To Use Ecosystem”
This involves one of the rare times the community has considered adding third parties in order to help with user experience. A behind the scenes, third account interacts with a middleman who exchanges these tokens for a small amount of ether without any direct interaction. This preliminary provides enough ether to pay for the gas that allows the transaction to occur. So, again, it’s actually ether that is still being used to buy gas, it’s just kind of a shortcut used to make the network easier for everyone to use.
The Future is Now
ERC-865’s gain in popularity is part of a greater trend going on in the blockchain space. People frame the term “cryptocurrency adoption” as some active decision, but that’s not how reality works. We don’t need people to openly embrace cryptocurrency. We need to provide them with an ecosystem that is so easy to use; a system where users don’t even know that they’re utilizing cryptocurrencies and blockchain technology. A little secret is starting emerge concerning widespread cryptocurrency adoption; the best way to achieve adoption is through user experience, specifically easy of use. And that’s exactly what ERC-865 is doing.