CashTokens and ERC-20 both support fungible assets, but they sit at different layers of their networks.
CashTokens are native Bitcoin Cash primitives defined by consensus. ERC-20 is an Ethereum application interface implemented by smart-contract code. That distinction changes where balances live, who validates supply rules, and which risks remain in issuer code.
Core model
| Property | CashTokens | ERC-20 |
|---|---|---|
| Ledger model | Token data attached to BCH UTXOs | Balances and allowances in contract storage |
| Base validation | BCH consensus validates token conservation and capabilities | EVM executes each token contract's code |
| Standard identity | 32-byte token category ID | Contract address on a specific chain |
| Fungible supply control | Created at category genesis; later transactions can transfer or burn it | Contract-defined mint, burn, and admin functions |
| NFT support | Native NFT commitments and capabilities | Separate interfaces such as ERC-721 and ERC-1155 |
| Metadata | External registries and application conventions | Contract methods, token lists, and external metadata |
The CashTokens specification defines how token prefixes are encoded and conserved. EIP-20 defines a common function and event interface; each deployed contract supplies the implementation.
Validation and supply risk
All fungible units in a CashToken category are created in its genesis transaction. Later transactions cannot increase that category's total fungible supply. A minting NFT authorizes new NFTs in the same category; it does not authorize more fungible units. The fungible token rules enforce this distinction at consensus level.
An issuer can still hold part of the genesis supply in reserve and release it later. Fixed total supply therefore does not mean fixed circulating supply or fair distribution. Check both the genesis amount and who controls the reserves.
It does not remove application risk. Covenants, exchanges, bridges, wallets, metadata registries, and issuer key management can all fail. A minting NFT is powerful authority and must be secured or deliberately destroyed according to the issuer's policy.
An ERC-20 contract can implement fixed supply, capped minting, pausing, fees, blacklists, snapshots, upgradeability, or custom behavior. That flexibility is useful, but users must evaluate the actual bytecode, proxy and admin controls, and whether the advertised source matches the deployed contract.
"ERC-20" describes interface compatibility, not one security model.
Fees and transaction construction
A CashToken transfer is a BCH transaction, so its fee is generally based on serialized size and current relay or miner policy. Token selection can increase input and output count, and token-aware change must be constructed correctly.
An ERC-20 transfer consumes gas according to contract execution and network conditions. A simple implementation has a familiar cost profile, while fee-on-transfer, proxy, hook, or application logic can use more gas.
Neither standard guarantees a fixed fiat cost. Native validation can make CashToken accounting compact, but BCH and Ethereum have different demand, capacity, infrastructure, and security environments.
Programmability
CashTokens can carry fungible amounts and NFTs with immutable, mutable, or minting capabilities. CashVM contracts can inspect tokens and enforce covenants around them. State is usually represented by controlled successor outputs.
ERC-20 contracts operate inside Ethereum's shared account state and can be called synchronously by other contracts. This supports a large composable application ecosystem, but composition imports dependencies: an oracle, lending market, bridge, proxy, or token callback can affect downstream systems.
CashToken applications can compose through multi-input transactions and shared conventions. The ecosystem and tooling are smaller, and transaction assembly is less familiar to many web developers.
Metadata and user identity
The category ID or contract address identifies the token at the protocol or chain level. A name, ticker, icon, website, and decimal display are not proof of legitimacy.
CashTokens commonly use Bitcoin Cash Metadata Registries. ERC-20 wallets combine contract calls, curated token lists, and off-chain metadata. In both cases:
- symbols can be duplicated;
- icons can be misleading;
- metadata can disappear or conflict;
- chain and network must be displayed;
- users should verify the category ID or contract address for consequential actions.
Decimals are a display convention. Base-unit balances remain integers.
Allowances and custody
ERC-20 applications frequently use allowances: a user authorizes another contract to transfer tokens later. Unlimited or stale allowances create a distinct attack surface.
CashTokens do not use ERC-20 allowances at the protocol layer. An application can create equivalent delegated control through contract outputs or signing policies, so permission risk has not vanished; it is expressed differently.
Ecosystem and interoperability
Ethereum has a much larger deployed token, exchange, wallet, custody, and developer ecosystem. That depth improves integration options but also increases the number of contracts and dependencies a user may encounter.
CashTokens have a smaller ecosystem and a more recent standard. Native support is useful only when wallets, indexers, exchanges, and applications handle token-aware addresses, change, metadata, and signing correctly.
Bridges add another trust and security layer regardless of direction. A bridged representation is not the original asset, and its safety depends on custody, verification, upgrade, and redemption mechanisms.
Choosing the right comparison
CashTokens reduce repeated token-accounting code by moving core token conservation into BCH consensus. ERC-20 gives issuers and applications a flexible contract interface inside a mature shared-state ecosystem.
The right choice depends on required administration, application composition, liquidity, wallet support, fee tolerance, and the security assumptions users can audit. Compare specific tokens and deployments, not just standard names.
The UTXO versus account-model comparison explains the underlying state designs. TokenWatch lets you inspect observed CashToken activity while keeping protocol data separate from token metadata.