A protocol is a standardized method for performing some action. Ethereum protocols typically designate how the platform will function and are named after the proposal that initiated them. The three principal Ethereum protocols go as follows:
ERC-20: This standard defined the mechanism for smart contracts and token distribution, and essentially changed the world of cryptocurrency forever. Instead of developers needing to write their own software, set up their own nodes, and run their own blockchain, now a token developer need only be familiar with the programming language used by Ethereum to define how their token will function within the ERC-20 framework.
ERC-223: This standard improved upon the transfer functions designed in ERC-20, especially with regard to unsupported tokens being transferred to smart contracts. Now, if a token is unsupported, the transaction is canceled. This helps reduce the risk of sending the wrong token to the wrong contract, and potentially suffering the loss of the tokens involved.
ERC-721: This standard introduced the prospect of individual tokens that are not interchangeable with all the other tokens defined by the contract. As such, this standard defines NFTs, which has led to a whole new collection of Dapps that are organized around the sale and holding of NFTs, which themselves hold value and can be collectible.
Ethereum protocols are always being improved upon to increase the security and utility of the network. As such, all Eth protocols are viewable on the Ethereum foundation’s website at https://www.ethereum.org.
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