Ethereum Token Standards: ERC-20, ERC-721 and ERC 1155.

 

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Ethereum Token Standards are unique protocols that define standard rules and requirements for developing smart contracts on the Ethereum blockchain network. 

But, what is a "Token?"

A cryptocurrency token is a virtual denomination of an already existing cryptocurrency. They are digital assets built on another cryptocurrency's blockchain. The major difference between a coin and a token is, coins exist on their own blockchain while tokens are built on an existing blockchain.

To have a token on the Ethereum network, you have to create it in accordance with some certain standards approved by the Ethereum community so that your token can be used in a specific way.

On the Ethereum network, there is something called the Ethereum Request for Comments (ERC). This is a document developers use to write a smart contract on the Ethereum blockchain.

The most popular type of ERCs include

• ERC 20
• ERC 721
• ERC 1155

• ERC 20

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The ERC 20 is a standard for fungible tokens.

In my last post, I explained the concept of fungible and non-fungible items.

The ERC 20 is used to create tokens that are the same and don't vary from each other, hence they're interchangeable. It was proposed by Fabian Vogelsteller in November 2015.

ERC 20 tokens are:

• Transferable: They can approve the transfer of tokens from one account to another.

• Fungible: The tokens are the same, of the same value and are interchangeable.

• Fixed supply: It provides info about the total supply of tokens, which should be fixed.

ERC 20 tokens are also able to approve the withdrawal of a number of tokens from a specified account.

Some tokens that utilize the ERC 20 include Uniswap.

• ERC 721

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The ERC 721 is a standard for non-fungible tokens. This means that each ERC 721 token is unique and different from the other, they are not interchangeable. An ERC 721 token has a different value from another.

The most common use case for ERC 721 is in the ownership of digital assets such as NFTs. Each NFT is unique, one cannot be replaced by another. NFTs are used mostly for the trade of digital arts.

Some popular NFTs that utilize the ERC 721 include: CryptoKitties, Bored Ape Yacht Club, Gods Unchained Cards etc.

• ERC 1155

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We've looked at the token standards for fungible tokens, and that for non-fungible tokens. The ERC 1155 is a "multi-token standard.

The ERC combines the functionality of the ERC 20 and the ERC 721 to be able to manage multiple token types. Before the ERC 1155, you needed to deploy different smart contracts for a fungible token and for a non-fungible token. This was stressful in a way, especially for crypto gamers who mostly operated a gaming platform that utilised both.

However, in June 2018, five months after the introduction of the ERC 721, Witek Radomski, Andrew Cooke, Philippe Castonguay, James Therien, Eric Binet, and Ronan Sandford proposed the ERC 1155, a smart contract interface that could control both fungible and non-fungible tokens.

There are other types of Ethereum token standards but these remain the most popular.

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