Overview
An allowance is the approved amount a contract may spend from a user’s wallet. It is set via token approvals. Tracking allowances is important for security.
How It Works
A user approves an allowance, and the contract can transfer up to that amount. The allowance decreases as it is used. It can be reset or revoked anytime.
Why It Matters
Allowances determine the exposure a contract has to user funds. Large or unlimited allowances increase risk. Monitoring them is part of wallet hygiene.
Related Concepts
Allowances relate to Token Approvals and ERC-20. They define Contract spending limits.