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I was studying the ERC20 token and came across the following hook-

function _beforeTokenTransfer(
        address from,
        address to,
        uint256 amount
    ) internal virtual {}

But I could not understand what is the significance of this and how are they useful. Can someone explain to me what hooks do here as well as what is the importance of hooks in general?

1 Answer 1

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Hooks are simply functions that are called before or after some action takes place. They provide a centralized point to hook into and extend the original behavior and offers flexibility in modifying the behavior of a token. For example, the _beforeTokenTransfer hook allows you to execute functionality before any transfer of tokens. This includes minting and burning.

See:

https://github.com/OpenZeppelin/openzeppelin-contracts/blob/master/contracts/token/ERC20/ERC20.sol

https://docs.openzeppelin.com/contracts/3.x/extending-contracts#using-hooks

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