> For the complete documentation index, see [llms.txt](https://docs.onefinity.network/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.onefinity.network/technology/esdt-vs-erc-20.md).

# ESDT vs ERC-20

**Pre-coded and Non-programmable**

ESDT tokens are pre-coded with a fixed set of functionalities, eliminating the need for developer expertise and auditing for robustness and security, unlike ERC-20 tokens.

#### Native Smart Contract Interaction

ESDT tokens offer native support for smart contract interactions, streamlining the development process compared to ERC-20 tokens, which often require complex and error-prone logic.

#### Simplified Transactions

ESDT tokens operate on a registry, facilitating wallet-to-wallet transfers without requiring contract signing. This simplifies transactions and reduces the risk of fund loss through malicious contracts.

#### Growing Ecosystem

While ERC-20 benefits from a mature ecosystem, ESDT will be quickly catching up due to OneFinity's EVM-compatible technology. This growth will bring more developer resources, tools, and libraries for ESDT token creation, making it a future-proof choice for developers and end chain users. 

#### Performance and Scalability

ESDT tokens leverage OneFinity's Sovereign Shards technology for fast, efficient, and cost-effective transactions. This scalability advantage is inherent to ESDT tokens on OneFinity as a complete L1, whereas Ethereum's solutions rely solely on Layer 2 technology for similar performance.

#### Key Functionalities:

* **Upgrading:** Update token properties as needed.
* **Ownership Transfer:** Transfer ownership to another ESDT account.
* **Wiping:** The token manager can erase tokens held by a frozen account.
* **Freezing:** Block all incoming and outgoing transactions for a specific account.
* **Pausing/Unpausing:** Temporarily halt all operations except minting and burning.
* **Burning:** Users can destroy a certain amount of their tokens.
* **Minting:** Create new tokens after their initial release.

In conclusion, ESDT tokens offer unique benefits such as enhanced security, simplified transactions, scalability and **true asset ownerships** on the OneFinity blockchain. The standard's simplicity, EVM-compatibility and built-in features make it an attractive choice for developers and users alike.