➥ ERC-S: The Standard That Gives Tokens Real Value ERC-20 built the foundation of DeFi, but it also exposed its biggest flaw, tokens with no real intrinsic value. ERC-S is a new answer to that problem. It links tokens to real company performance while staying compliant. Here's all you need to know about ERC-S in 30s 🧵 — — — ► What is ERC-S? @ethereum Request for Comment (ERC) is the framework that defines how tokens are created and interact on Ethereum. Simply put, ERC-20 is the base standard for fungible tokens. It powered DeFi’s growth but represents utility, not value, so most tokens fade once hype ends. ERC-S is the model proposed by @StreetFDN. It links tokens to real company cash flows, giving holders compliant exposure to business growth and turning tokens into assets with real value. — ► ERC-20 vs ERC-S Value link: ERC-20 → no connection to company performance. ERC-S → ties tokens to real business flows. Tokenholder rights: ERC-20 → utility only. ERC-S → discretionary upside via DAO governance. Legal position: ERC-20 → often drifts toward speculative behavior. ERC-S → compliant with optional, non-equity distributions. Transparency: ERC-20 → limited visibility, no enforcement. ERC-S → audits, pause triggers, and open reporting. Incentive alignment: ERC-20 → token and company growth often conflict. ERC-S → both rise together as value flows through one system. If one comparison matters most, it’s this: ERC-20 runs on speculation, ERC-S runs on substance. — ► How it Works ERC-S connects the company, its equity, and its tokenholders through one transparent structure. Flow: OpCo → SPV/Foundation → DAO → Tokenholders ➤ OpCo is the operating company that earns revenue. ➤ SPV/Foundation holds the company’s equity and receives the proceeds. ➤ DAO votes on when and how much to distribute. ➤ Tokenholders claim payouts on-chain through a distributor. Distributions are discretionary, keeping ERC-S non-security. Audits, pause triggers, and dual-key custody add protection and trust. This structure links token value directly to business performance, aligning holders with the company. — ► Why it Matters ERC-20 made fundraising easy but separated holders from real company value, pushing founders to chase hype instead of performance. Tokens became short-term trades rather than long-term assets. ERC-S fixes that by aligning holders, founders, and investors in one structure that shares success. Startups can raise capital without selling equity, while holders gain exposure to real growth. — ► Wrap-Up ERC-20 built DeFi’s foundation and made token creation simple, but it never linked tokens to real company value. Most projects grew on speculation and faded once the hype passed. ERC-S upgrades that model with transparency, compliance, and real economic alignment. It allows tokens to reflect business performance without becoming securities, marking a new phase where Ethereum assets are backed by revenue and trust. -- CC - @MiyaHedge

— Disclaimer

Found this thread helpful? Show your support with: 🔵 Share 🔴 Like 🟠 Retweet 🟢 Bookmark And follow @eli5_defi

sounds bullish on Ether ngl the infra for the world finance

Ethereum is still the OG and Goated chain (despite $10 gas fees)

no fred cuz we have l2s base arbitrum stuff

ERC-S could be the game changer, linking tokens to real value!

Finally the real ICM

As always man’s pretty early