How Does the ERC-721 Standard Differ Fundamentally from ERC-20?
ERC-721 is the standard for Non-Fungible Tokens (NFTs), meaning each token is unique and distinct, unlike the interchangeable tokens of ERC-20. The key difference lies in the unit of value; ERC-721 tracks individual tokens, each with a unique ID and metadata, while ERC-20 tracks a collective balance.
This uniqueness makes ERC-721 suitable for representing ownership of unique digital or physical assets.
Glossar
Erc-20
Architecture ⎊ The ERC-20 standard defines a uniform API for fungible tokens on the Ethereum blockchain, facilitating interoperability between decentralized applications and exchanges.
Representing Ownership
Claim ⎊ Ownership, within the context of cryptocurrency, options trading, and financial derivatives, fundamentally represents the legally recognized right to control and benefit from an asset.
Token Metadata
Data ⎊ Token metadata encompasses the non-financial, descriptive attributes of a digital asset, such as its name, ticker, smart contract address, and potentially crucial on-chain risk parameters relevant to derivatives trading.
Interchangeable Tokens
Token ⎊ Interchangeable tokens, within the context of cryptocurrency derivatives, options trading, and broader financial engineering, represent standardized digital assets designed for seamless substitution across various platforms and contracts.
Erc-721 Standard
Specification ⎊ Erc-721 Standard is the technical specification on the Ethereum blockchain defining a non-fungible token, mandating unique identification and ownership tracking for each individual token instance within a smart contract.
Non-Fungible Tokens
Token ⎊ Non-Fungible Tokens (NFTs) represent a paradigm shift in digital asset ownership, extending beyond traditional cryptocurrency fungibility.