Erc 721 tokens
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This document discusses ERC-721, the Ethereum Request for Comment standard for non-fungible tokens (NFTs). It begins by introducing CryptoKitties, a popular application that uses the ERC-721 standard to represent unique digital cats. It then defines fungible and non-fungible assets, explaining that ERC-721 allows for unique digital collectibles. The document outlines ERC-20, the standard for fungible tokens, and compares it to ERC-721. It envisions potential future applications of ERC-721 tokens to represent real-world assets like property.
Erc 721 tokens
- 1. ERC 721 Tokens Non Fungible Token Standard By Priyabrata Dash (Aka Priyab Satoshi) https://medium.com/crypt-bytes-tech @twitmyreview [email protected] https://www.meetup.com/India-Blockchain-Cryptocurrency-Meetup/
- 2. Agenda • Introduction • Defining Fungibility • What ERC Mean • ERC 20 • ERC 721 • ERC-20 v. ERC-721 • FUTURE OF ERC-721
- 3. Introduction • Since its launch in November, CryptoKitties app has reportedly seen $12 million worth of ether spent in buying and trading various unique digital cats on its platform. • The decentralized app became so popular that it slowed down the average transaction time on the Ethereum network, sparking conversation on online forums about the necessary growing pains the network has to endure as developers tackle scalability issues. • Much less discussion, let alone excitement, however, has focused on the powerful properties of CryptoKitties, namely their launch as an ERC-721 token, known as a non-fungible token (NFT).
- 4. Defining Fungibility • When a set of assets all have equal value to each other, they are defined as fungible. As an example, a US dollar has the same value as any other US dollar. • The person spending that dollar and the person receiving that dollar do not care where that dollar came from or where it might eventually land. In the world of crypto-assets, fungibility promotes high liquidity among tokens in an ecosystem. • As all tokens of a particular blockchain are created equal, multiple transactions can occur rapidly and instantaneously without the participants worrying if the tokens all store the same value. • A non-fungible asset, however, is not equal to its counterparts. The most tangible example of a non-fungible asset is any sort of collectible. A baseball is just a baseball until it is signed by Babe Ruth. Then, it gains additional value and becomes a non-fungible asset, valued differently than all other baseballs out there. • Non-fungible assets generally have a greater scarcity than fungible ones, and therefore hold more intrinsic and unique value. With scarcity and value now measurable in the digital realm through blockchain and distributed ledgers, we are just beginning to see the potential of non-fungible digital assets.
- 5. What does ERC mean? • ERC stands for Ethereum Request for Comments. An ERC is authored by Ethereum community developers in the form of a memorandum describing methods, behaviors, research, or innovations applicable to the working of the Ethereum ecosystem. • It is submitted either for peer review or simply to convey new concepts or information. After core developers and community approval, the proposal becomes a standard. • Therefore, as a result, we have a set of standards or proposals (e.g. for tokens). Actually, these rules are simple set of functions that Smart Contract should implement. • In return, contracts, implementing the standard can be used via a single interface. The best example is ERC-20 standard. All Smart Contracts implementing this standard, by default can be listed to crypto exchanges without any extra technical work.
- 6. ERC-20 • It is the most common and well-known standard within all crypto community. 99% (if not all) issued ICO tokens on top of the Ethereum implements this standard. • The key benefit we get here, is that any application or other smart contract can interact with a token in a standard manner without a need of knowing other details about the token. • Therefore, we have a very pleasant way to create any ICO token and have a standard way to interact with all of them like they are all the same. • For instance, crypto wallet developers can avoid custom development and integrations to add new tokens. All they need to know is the Ethereum Token address that implements the standard.
- 7. ERC 721 • The goal of this proposal, is to create a non- fungible token. In ERC-20 and ERC-223 standards we have a supply of tokens, where tokens are fungible (i.e. single unit of that token is equal to another unit). • This makes it easy to trade those tokens, as all of the token supply can be treated in the same manner. • However, there are various cases when you need to have unidentical tokens, which are used within the platform, and add some extra parameters and price them differently. • For instance, we could have a token which represents some part of real estate object, and each token might have some different parameters added to it. • Such standard would make it easy to create marketplaces for multiple non-fungible token types.
- 8. ERC-20 v. ERC-721 • Most tokens currently built off the Ethereum blockchain are ERC-20 tokens. • ERC-20 tokens are highly useful and liquid, and have been used to raise billions of dollars through ICOs. • Many serve as utility tokens, which allow holders of those tokens to access a particular dApp and its services. • ERC-721 tokens, however, are purposefully non-fungible. • By design, ERC-721 tokens are each given a unique and indivisible set of properties, unequal to other tokens on its blockchain. • Unlike ERC-20 tokens, which can be divided nearly infinitesimally (a powerful tool for a future with distributed micro-lending and crowd- lending), ERC-721 tokens cannot be divided, as they represent one unique asset in its entirety (the same way the Babe Ruth baseball cannot be split in half and maintain its value). • As the explosion of CryptoKitties has demonstrated, ERC-721 tokens will usher in a world of crypto-collectibles, where people recognize unique scarcity on the blockchain just as they do in the physical world.
- 9. FUTURE OF ERC-721 • Beyond the world of digital crypto-collectibles, however, CryptoKitties poses an interesting case for a tokenized future, where even physical assets are represented on the blockchain and NFTs are owned not just for their intrinsic, collectible value, but for their practical utility. • We could see a future where land plots and houses or corporate stocks are tracked and owned through an ERC- 721 token blockchain. • Applications built off Ethereum such as Decentraland are already building virtual worlds in which non-fungible assets can be traded between users in the ecosystem.
- 10. Reference • https://medium.com/crypto-currently/the-anatomy-of-erc721-e9db77abfc24 • https://en.wikipedia.org/wiki/Cryptokitties • https://www.cryptokitties.co/Technical-details • https://thebitcoin.pub/t/cryptokitties-isn-t-about-the-cats-hint-erc-721/23883 • https://ethereum.stackexchange.com/questions/36394/how-to-create-your-own- erc-721-nft-token • Please refer the reading list for the ERC 721 token in the link below for more reference: https://medium.com/crypt-bytes-tech/reading-list-erc-721-nft-token-standard- 7524b64ef5df