With ERC-721, it became simple to generate cryptographically unique tokens that could be tied to unique content, such as artwork, music, sneaker, etc.
What is ERC721? How about its use cases in crypto space? Let’s talk about it in this article.
What is ERC721?
ERC721 (Ethereum Request for Comments 721), created by four developers William Entriken, Dieter Shirley, Jacob Evans, and Nastassia Sachs in 2018, is a type of standard for representing ownership of non-fungible tokens.
ERC721 is a more complex standard than ERC20, with multiple optional extensions, and is split across a number of contracts. Its functionalities are for transferring tokens from one account to another, obtaining an account’s current token balance, getting the owner of a given token, obtaining the total supply of the token available on the network, etc.
The difference between Non-Fungible Token (NFT) & Fungible Token (FT)
Fungible Token (FT) is a completely interchangeable digital asset that works in the same way that currencies do. Fungible Token’s most important properties are interchangeability, divisibility, homogeneity.
Fungible Tokens are built entirely on the blockchain. Because of their fungibility, they may be simply swapped out for other Fungible Tokens of the same type.
Non-Fungible Token (NFT) is a one-of-a-kind digital asset that cannot be replaced by another token. Which means, it is completely unique.
There are many different use cases for Non-Fungible tokens (NFTs), such as demonstrating ownership or tokenizing works of art by artists and game developers, and so on, due to their characteristics.
The key distinction between fungible and nonfungible assets is the content that they store. While fungible tokens like Bitcoin store value, Non-Fungible tokens store data like an academic title or an artwork.
Applications of ERC-721 Tokens on Blockchain
The ERC-721 token standard has a growing number of use cases; here are a few of the most common ones:
Artists can monetise their work by using ERC-721 to tokenize them on Ethereum and selling on the NFT marketplace to earn money. NFT marketplaces, in contrast to traditional art markets, frequently offer clear fee structures and other helpful support systems.
This “Everydays: The First 5,000 Days” NFT was previously created by a 41-year-old man named Beeple. He collected 5,000 different images and day by day combined each one into a single image. When the art was auctioned off, the amount of money shocked the community, fetching $69 million at the end of the auction.
NFT empowers a new type of application that is similar to collecting postal stamps in real life – NFT Collectibles. Collectors can buy digital products that they think are valuable.
NFT collectibles, unlike physical collections, have no limits such as sluggish shipping or high maintenance costs; they may be delivered in seconds and never lose quality.
CryptoPunks are among the most well-known NFT Collectibles, with a total of 10,000 CryptoPunks (6,039 males and 3,840 famales), all of which are one-of-a-kind. Because each character is generated algorithmically using computer code, no two characters are identical.
Unlike NFT Collectibles, which are solely for collecting, the NFT game will include NFT into the game’s rules and mechanics.
Game publishers have complete control over the distribution, ownership, and qualities of in-game objects in traditional online video games. Users will lose access to all game items that they may have spent hours, days, weeks, or even months obtaining if the publisher stops operating.
With the implementation of NFT in the gaming industry, players will not have complete control over their game items, and games will be able to operate in a new way. This involves building an interoperable metaverse – where things from one game may be used and traded in another – and randomly distributing NFT awards in blockchain-based games.
NFT Examples: Some popular NFT projects
Bored Ape Yacht Club (BAYC)
Bored Ape Yacht Club or commonly known as Bored Ape, is an NFT Collectibles built on Ethereum. It is a set of animated apes created by the Yuga Labs team, which is currently valued at billions of dollars.
Axie Infinity (AXS)
Axie Infinity is a Blockchain-based video game centered on Axie creatures, similar to Pokemon GO. Axies are virtual pets that players can acquire and train. They can also battle, breed, collect, grow, and build kingdoms for their Axies.
What distinguishes Axie Infinity from other online games is the synergy it has created between traditional online gaming and blockchain technology. The Ethereum-based game has a concept that allows players to own their virtual assets and rewards those who can attain a high level of expertise.
Ethereum Name Service
The Ethereum Name Service is a decentralized domain name service system with an open mechanism built on the Ethereum platform. Users can generate ERC-721 NFTs with Ethereum Name Service. The tenant’s.eth domain is represented by these NFTs.
This article has provided a comprehensive overview of what ERC721 is, as well as some prominent examples for this topic! If you find it useful, please share it with your friends!
What are your thoughts on the NFT trend’s potential and applicability? Let us know what you think in the comments section below!
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