ERC-721: Standard non-fungible token for collectibles
The popular CryptoKitties app can foreshadow a powerful example of using another standard on Ethereum-for digital collectibles.
After the launch, Cryptocurrencies have become the most popular application on ethereum: so popular that now there are CryptoPuppies (for those who prefer a "real best friend") and CryptoPets (which allows users to choose any digital animal as a pet).
While some in the community are skeptical about this trend and say: "Lord, not this!"- regarding the idea to launch PokemonGo on the blockchain, others see CryptoKitties as a pioneer in the field of large-scale user applications with decentralization.
The application can be important because it shows how to use blockchain to transfer all kinds of assets instantly without a third party. There is reason to believe that this is a real upgrade of consumer-oriented applications.
The device of the system for creating collectibles depends on the technical standard (for example, ERC-20 — which caused a boom in the ICO in 2017). Favorite fluffy kitten became possible thanks to the new technical standard — Ethereum Request for Comments 721 (ERC-721).
ERC-721 has been talked about for a long time, but no one has implemented it before. CryptoKitties were the first.
The standard of incompatible (non-interchangeable) token was invented by Dieter Shirley. He created the draft on September 20, 2017.
This standard allows the implementation of a standard API for incompatible tokens (hereinafter referred to as "NFT") under smart contracts. This standard provides basic functionality for tracking and transferring ownership of NFT.
The standard interface allows any NFT on Ethereum to be processed by General purpose applications. In particular, this will allow you to track the NFT in your wallet and trade them on the exchanges.
The basis of this standard is that each NFT is identified by a unique 256-bit unsigned integer as part of its tracking contract. This identification number shall not be changed during the term of the contract. This pair (contract address, asset ID) will be a unique identifier for a particular NFT in The Ethereum ecosystem.
The use of uniqueness
According to many cryptographers, ERC-721 is better suited for digital collectibles than ERC-20.
Tokens created using ERC-20 are "interchangeable," which means each token is as good as any other token, for example, every dollar is as good as any other dollar.
While this is a necessary property for a currency, it is not suitable for "crypto collections" such as CryptoKitties, because different cats must have unique attributes such as age, breed, or color that are permanently attached to them. Thus, some mixture of attributes certain cats can become very rare, that makes their not only very popular, but and extremely valuable.
One of these kittens in CryptoKitties sold for 110 000 dollars.
Second, ERC-20 tokens are split, which means that users can split them into small amounts for purchase, sale, or trade.
Although this property is useful for the currency again, it is not appropriate for collectibles because they are evaluated by their state. Half a cat wouldn't be so funny or valuable.
ERC-721 is rapidly gaining momentum and is already in use, it is not yet complete, and some developers are unhappy with the code that is written today. The standard will still be developed.
ERC-721 ideas
The ideas underlying the ERC-721 are not new, but are based on already functioning digital collection systems.
For example, CryptoPunks created their own non-reproducible token to trade pixel punk heads on Ethereum.
After the success of CryptoKitties, startups and developers begin to show interest in ERC-721 as a way to simplify the use of crypto assets.
James Martin Duffy, co-founder of the loomx startup, who is working on scaling the infrastructure for ethereum, told CoinDesk he has plans to deploy projects using the standard in the future.
"I think the ERC markers-721 is a huge potential in the field of digital collections and online gaming," said Duffy. — You can use them for digital playing cards ... or game items in a multiplayer online RPG. Items can represent swords, armor, and other ammunition that your character has in his inventory."
This is not the end. According to Duffy, the ERC-721 can also facilitate tracking, trading, and managing real-world assets such as homes or cars.
The developers of 0X-decentralized exchange of ERC-20 tokens, soon plan to add support for ERC-721, so that different types of tokens can be easily exchanged.
So far, this standard is close to the semantics of ERC-20, but cannot be fully compatible with it due to fundamental differences between interchangeable and non-interchangeable tokens.
Great article. I think a lot of people overlook the smart contracts and the type of ERC that the blockchain is implementing.
Thank you for this very informative article. For RPGs do you think tradeable items (such as swords, armor, etc) will need a new token standard, do you think ERC-721 will be adapted to suit the needs of an RPG, or will we see perhaps something else entirely?