Blockchain Developer Token Standards and Creation — Questions and Answers

Question 1: Which ERC-20 function returns the number of tokens a spender is still allowed to withdraw from an owner's account?

allowance(owner, spender) (Correct answer)
balanceOf(owner)
approve(spender, amount)
transferFrom(from, to, amount)

Correct answer: allowance(owner, spender)

allowance(owner, spender) returns the remaining amount the spender is permitted to withdraw.

Question 2: In ERC-20, what is the well-known race-condition risk associated with the approve() function?

A spender can front-run a changed approval and spend both the old and new amounts (Correct answer)
It permanently locks the owner's balance
It mints unlimited tokens
It bypasses the totalSupply cap

Correct answer: A spender can front-run a changed approval and spend both the old and new amounts

Changing an existing non-zero allowance lets a spender front-run and use both old and new amounts.

Question 3: What does the ERC-20 decimals() function actually control?

Only the display formatting of token amounts off-chain (Correct answer)
The on-chain divisibility enforced by the contract
The maximum total supply
The gas cost of transfers

Correct answer: Only the display formatting of token amounts off-chain

decimals() is purely informational for UI display; the contract stores integer values regardless.

Question 4: Which event must an ERC-20 token emit when tokens move between addresses?

Transfer(from, to, value) (Correct answer)
Approval(owner, spender, value)
Sent(operator, from, to)
Mint(to, value)

Correct answer: Transfer(from, to, value)

The Transfer event is required on every token movement, including minting (from the zero address).

Question 5: Why is it best practice to emit a Transfer event from the zero address when minting ERC-20 tokens?

So off-chain indexers can track supply changes consistently (Correct answer)
Because the EVM rejects mints without it
To reduce gas costs
To prevent reentrancy

Correct answer: So off-chain indexers can track supply changes consistently

Emitting Transfer from address(0) lets explorers and indexers treat minting as a standard balance change.

Question 6: What problem does the ERC-2612 'permit' extension solve for ERC-20 tokens?

It allows gasless approvals via off-chain signed messages (Correct answer)
It increases the maximum supply
It adds NFT metadata
It enables cross-chain bridging automatically

Correct answer: It allows gasless approvals via off-chain signed messages

ERC-2612 permit lets users approve spenders with a signature, removing the need for a separate approve transaction.

Question 7: If an ERC-20 transfer() returns false instead of reverting, what is the recommended way to handle it safely in a calling contract?

Use a SafeERC20 wrapper that checks the return value and reverts on failure (Correct answer)
Ignore the return value since transfers always succeed
Retry the transfer in a loop
Call selfdestruct on failure

Correct answer: Use a SafeERC20 wrapper that checks the return value and reverts on failure

SafeERC20 wrappers verify the boolean return and revert, handling non-compliant tokens correctly.

Question 8: What is the key difference between ERC-721 and ERC-1155 token standards?

ERC-1155 supports both fungible and non-fungible tokens in one contract, ERC-721 only non-fungible (Correct answer)
ERC-721 is for fungible tokens only
ERC-1155 cannot represent NFTs
ERC-721 supports batch transfers but ERC-1155 does not

Correct answer: ERC-1155 supports both fungible and non-fungible tokens in one contract, ERC-721 only non-fungible

ERC-1155 is a multi-token standard handling fungible, non-fungible, and semi-fungible tokens together.

Question 9: Which ERC-721 function returns the owner of a specific token ID?

ownerOf(tokenId) (Correct answer)
balanceOf(owner)
tokenURI(tokenId)
approve(to, tokenId)

Correct answer: ownerOf(tokenId)

ownerOf(tokenId) returns the address that currently owns the given NFT.

Question 10: What is the primary purpose of the ERC-721 tokenURI() function?

Return a URI pointing to the token's JSON metadata (Correct answer)
Transfer the token to a new owner
Burn the token
Return the total supply

Correct answer: Return a URI pointing to the token's JSON metadata

tokenURI() returns a link to metadata describing the NFT, often including name, image, and attributes.

Question 11: Why does ERC-1155 enable significant gas savings for transferring many tokens?

It supports batch operations like safeBatchTransferFrom in a single transaction (Correct answer)
It eliminates the need for events
It removes ownership tracking
It uses no storage

Correct answer: It supports batch operations like safeBatchTransferFrom in a single transaction

Batch transfer functions let multiple token types and amounts move in one transaction, reducing overhead.

Question 12: What safety check distinguishes safeTransferFrom from transferFrom in ERC-721?

It verifies the recipient contract implements onERC721Received (Correct answer)
It checks the sender's gas balance
It validates the token's metadata URI
It enforces a maximum supply

Correct answer: It verifies the recipient contract implements onERC721Received

safeTransferFrom calls onERC721Received to ensure contract recipients can handle NFTs, preventing locked tokens.

Question 13: In ERC-1155 metadata, what does the {id} substitution placeholder in a URI represent?

The lowercase hex token ID padded to 64 characters (Correct answer)
The contract address
The owner's address
The chain ID

Correct answer: The lowercase hex token ID padded to 64 characters

Clients replace {id} with the 64-character zero-padded lowercase hex token ID to fetch per-token metadata.

Question 14: Which interface must a contract implement to be recognized as ERC-721 compliant via ERC-165?

supportsInterface returning true for the ERC-721 interface ID (Correct answer)
A public mint function
A fixed totalSupply variable
An owner-only constructor

Correct answer: supportsInterface returning true for the ERC-721 interface ID

ERC-165's supportsInterface lets contracts advertise that they implement the ERC-721 interface ID.

Question 15: When deploying a token contract, why is using OpenZeppelin's audited contracts generally preferred over writing from scratch?

They reduce the risk of security bugs through community-reviewed, tested code (Correct answer)
They make tokens immune to all attacks
They are required by the EVM
They eliminate all gas costs

Correct answer: They reduce the risk of security bugs through community-reviewed, tested code

Audited libraries lower the chance of introducing vulnerabilities compared to custom implementations.

Question 16: What is a 'mintable' token, and what access-control risk does it introduce?

A token whose supply can be increased; the minter role must be tightly controlled to prevent inflation abuse (Correct answer)
A token that can never change supply
A token with no owner
A token that auto-burns on transfer

Correct answer: A token whose supply can be increased; the minter role must be tightly controlled to prevent inflation abuse

Mintable tokens allow new supply creation, so unrestricted minting permissions can be exploited to dilute holders.

Question 17: What does making a token 'burnable' allow?

Holders or authorized roles to permanently destroy tokens, reducing total supply (Correct answer)
Tokens to be transferred without fees
The contract to be upgraded
Infinite minting

Correct answer: Holders or authorized roles to permanently destroy tokens, reducing total supply

Burning sends tokens out of circulation (often to address zero), decreasing totalSupply.

Question 18: Why might a token contract include a 'pausable' feature?

To halt transfers during an emergency or exploit, buying time to respond (Correct answer)
To permanently disable the token
To increase transfer speed
To bypass gas fees

Correct answer: To halt transfers during an emergency or exploit, buying time to respond

Pausable lets an admin freeze token activity temporarily if a vulnerability or attack is detected.

Question 19: What is the main trade-off of deploying an upgradeable (proxy-based) token contract?

It adds flexibility but introduces centralization and proxy-related security risks (Correct answer)
It permanently freezes the logic
It removes the need for gas
It prevents any future bug fixes

Correct answer: It adds flexibility but introduces centralization and proxy-related security risks

Upgradeable proxies allow logic changes but rely on an admin and add storage-layout and trust risks.

Question 20: During token creation, what does setting an initial supply in the constructor and minting it to the deployer accomplish?

It allocates the entire starting supply to the deployer's address at deployment (Correct answer)
It locks the supply forever to the contract
It distributes tokens equally to all addresses
It sets the token price

Correct answer: It allocates the entire starting supply to the deployer's address at deployment

Constructor minting credits the deployer with the initial supply, which can then be distributed.

Question 21: Why should a fixed-supply (non-mintable) token omit any mint function entirely?

To guarantee the supply cap can never be exceeded, building holder trust (Correct answer)
To save deployment gas only
Because mint functions are illegal
To allow unlimited burning

Correct answer: To guarantee the supply cap can never be exceeded, building holder trust

Removing mint capability cryptographically guarantees the supply cannot inflate beyond the cap.

Blockchain Developer Token Standards and Creation

Which ERC-20 function returns the number of tokens a spender is still allowed to withdraw from an owner's account?

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