ERC20 tokens workflow

Question

I am trying to understand what is the "workflow" (for the lack of a better word) of an ERC token in. Looking at this guy (nothing special about it, just a randon token), I can see that the first sucecssfull transaction on that contract is this one where an account (that starts with 3dc) called the Transfer function on contract and transfered 1 token (from its balance I believe) to an account that starts with "1caa". And then several hundred token transfers followed.

Im wondering how did account 0x3dc... have the token in the first place? I have been trought its transactions on etherscan and it never transfered ether to the contract.

Also, am I correct to assume that accounts get tokens by simply making ether transfers to the token's contract them, assuming the contract implement a payable function, the contract will get the ether and then updates the account's token balance on its "balances" variable?

Thanks

Answer 1

What you described in terms of selling tokens for ether is sometimes done, but it's more common for a token contract to just grant its creator an initial supply of tokens and for everything else to happen based on transfers from the creator. If tokens are to be sold in a crowdsale, it's common to have a second contract that handles the sale.

We have a few relevant posts on Program the Blockchain that should help explain the concept:

• What is an Ethereum Token?
• Writing an ERC20 Token Contract
• Writing a Token Sale Contract

EDIT

In the token you mentioned, code in the constructor assigns the initial balance to the account that created the contract:

function Token( uint initial_balance, address wallet, uint256 crowdsaleTime) {
  _balances[msg.sender] = initial_balance;
  _supply = initial_balance;
  walletAddress = wallet;
  creationTime = crowdsaleTime;
  transferStop = true;
}