ERC (Ethereum Request for Comments) standards are a crucial component of the Ethereum blockchain ecosystem. These standards provide a set of guidelines and specifications for creating and implementing smart contracts, tokens, and other blockchain-based applications on the Ethereum network.
ERC standards have played a key role in driving the growth and adoption of the Ethereum platform, as they provide a common language and set of best practices for developers to follow. In this article, we will explore the history of ERC standards, their importance to the Ethereum ecosystem, and some of the most popular ERC standards in use today
We will also look at some of the emerging trends and developments in the ERC standard space, and what the future may hold for this critical component of the Ethereum ecosystem.e
What are ERC standards?
ERC stands for "Ethereum Request for Comments". ERCs are a set of technical standards that are used to create and manage tokens on the Ethereum blockchain. These standards provide guidelines for the development of smart contracts and dApps (decentralized applications) that can be used to create, manage, and exchange tokens on the Ethereum network.
ERC standards define a set of rules and protocols that tokens must follow in order to be compatible with the Ethereum network. These rules cover a variety of aspects, such as token transfer functions, token ownership, and smart contract security. By following these standards, developers can ensure that their tokens are interoperable with other tokens and can be easily exchanged on the Ethereum network.
There are currently several ERC standards, including ERC-20, ERC-721, ERC-777, and ERC-1155, each of which has a specific set of features and functions. ERC-20 is the most widely used token standard and is used to create fungible tokens, while ERC-721 is used to create non-fungible tokens (NFTs). Other ERC standards, such as ERC-777 and ERC-1155, provide additional features and functions for creating more complex tokens.
ERC standards have played a crucial role in the development of the Ethereum ecosystem by providing a common set of guidelines and protocols for creating and managing tokens on the blockchain.
What is ERC 20?
ERC-20 stands for "Ethereum Request for Comments 20" and is a technical standard used for the creation of tokens on the Ethereum blockchain. ERC-20 tokens are fungible, meaning that each token is identical in value to every other token of the same type and can be used interchangeably.
The ERC-20 standard defines a set of rules that tokens on the Ethereum blockchain must follow to be considered ERC-20 compliant. These rules include functions such as balanceOf() to check a token balance, transfer() to send tokens from one address to another, and approve() to authorize a third-party to spend tokens on behalf of an address.
By adhering to the ERC-20 standard, developers can create tokens that can be used with a wide range of applications, wallets, and exchanges that support the standard. This makes it easier for tokens to gain widespread adoption and liquidity.
ERC-20 tokens have been used to create a variety of cryptocurrency projects, including utility tokens, stablecoins, and security tokens. Examples of ERC-20 tokens include Ethereum (ETH), Chainlink (LINK), and Uniswap (UNI).
The ERC-20 standard is arguably the most popular ERC standard in use today. It was first introduced in 2015 by Fabian Vogelsteller and has become the de facto standard for creating tokens on the Ethereum network. The ERC-20 standard provides a set of guidelines and specifications for creating fungible tokens, which are tokens that are all the same and interchangeable. This standard has been used to create thousands of tokens on the Ethereum network, including some of the most well-known projects in the cryptocurrency space. Other popular ERC standards include ERC-721 for non-fungible tokens (NFTs) and ERC-1155 for multi-token contracts.
ERC20 Example
Let's say we create a new ERC20 token called "ABC Token" with a total supply of 1,000,000 tokens. Each token will be divisible up to 18 decimal places.
To implement the ERC20 standard, we will need to define several functions, including:
- balanceOf(address): Returns the token balance of a specific address.
- transfer(address to, uint256 value): Transfers tokens from the caller's address to the specified address.
- approve(address spender, uint256 value): Approves a specific address to spend a certain amount of tokens on behalf of the caller.
- allowance(address owner, address spender): Returns the amount of tokens approved by the owner that the spender can transfer.
Here's an example of how these functions could be used:
- Alice owns 500,000 ABC Tokens.
- Bob wants to buy 100 ABC Tokens from Alice.
- Alice approves Bob to spend up to 100 ABC Tokens on her behalf.
- Bob calls the transferFrom() function with Alice's address, his own address, and the value of 100 tokens.
- The transferFrom() function deducts 100 tokens from Alice's balance and adds them to Bob's balance.
This is just one example of how an ERC20 token could be used. ERC20 tokens can be used for a wide range of purposes, including creating utility tokens, security tokens, or stablecoins, among others.
What is ERC 165?
ERC-165 is an Ethereum Improvement Proposal (EIP) that defines a standard interface for smart contracts to publish the list of functions and capabilities they support. It provides a standard way for dApps (decentralized applications) and smart contracts to check whether another contract or dApp implements a particular interface or set of interfaces.
ERC-165 was created to enable more efficient interaction between smart contracts and dApps on the Ethereum network. By defining a standardized way of checking whether a smart contract implements certain functions, it makes it easier for developers to create interoperable dApps and smart contracts.
ERC-165 specifies a single interface, called supportsInterface, which takes a 4-byte interface ID as input and returns a boolean value indicating whether the contract implements the interface. By implementing this interface, a smart contract can declare the interfaces it supports and allow other contracts to query it for its capabilities.
ERC-165 is an important standard for Ethereum because it helps to create a more modular and interoperable ecosystem of dApps and smart contracts.
What is erc 223?
ERC-223 is a proposed token standard for the Ethereum blockchain that aims to improve upon the ERC-20 standard, which is currently the most widely used standard for creating tokens on Ethereum.
The main difference between ERC-223 and ERC-20 is that ERC-223 tokens include an additional function for handling incoming token transactions. In ERC-20, when a user mistakenly sends tokens to a contract address that does not support them, the transaction is rejected and the tokens are lost forever. However, with ERC-223, the contract can implement a function that handles incoming transactions, which prevents the tokens from being lost and provides a better user experience.
ERC-223 also aims to make token transfers more efficient by reducing the amount of gas required for each transaction. With ERC-20, each token transfer requires two separate transactions, which can result in higher transaction fees and longer processing times. ERC-223 solves this problem by allowing a single transaction to transfer both tokens and data, which makes it more efficient and cost-effective.
ERC-223 aims to provide a more user-friendly and efficient token standard for the Ethereum network. However, it has not been widely adopted yet, and ERC-20 remains the most widely used standard for creating tokens on Ethereum.
What is erc 621?
ERC-621 is a proposed token standard for the Ethereum blockchain that expands upon the functionality of ERC-20 and ERC-223 standards by allowing tokens to be burned or redeemed for another asset. The standard allows token issuers to increase or decrease the total supply of tokens in circulation, which can be useful for managing the token economy and ensuring price stability.
ERC-621 tokens can be burned by sending them to a designated burn address, which removes them from circulation permanently. This can be used to decrease the total supply of tokens and potentially increase their value, as there are fewer tokens in circulation.
The standard also allows for token holders to redeem their tokens for another asset, such as a cryptocurrency or fiat currency. This can provide more flexibility and utility for token holders, as they can easily exchange their tokens for other assets if they choose to do so.
ERC-621 tokens can be used for a variety of purposes, such as creating stablecoins or loyalty programs. However, the standard has not been widely adopted yet, and it remains to be seen whether it will gain traction in the Ethereum ecosystem.
What is ERC 721?
ERC-721 is an Ethereum token standard that defines a non-fungible token (NFT) contract. Unlike fungible tokens like Ether (ETH) or ERC-20 tokens, each ERC-721 token is unique and non-interchangeable. This makes it ideal for representing assets such as collectibles, game items, digital art, and real estate.
The ERC-721 standard defines a set of functions that allow for the creation, ownership, and transfer of NFTs. Each NFT is represented by a unique identifier, and can have associated metadata, such as a name, description, and image.
ERC-721 tokens can be traded on various marketplaces, and their ownership is stored on the Ethereum blockchain. This means that ownership of an NFT can be easily verified and transferred between individuals.
The popularity of ERC-721 tokens has exploded in recent years, with high-profile sales of NFTs reaching millions of dollars. The standard has also been extended and improved upon with new proposals, such as ERC-1155, which allows for the creation of both fungible and non-fungible tokens within a single contract.
What is erc 777?
ERC-777 is a token standard for the Ethereum blockchain that builds upon the functionality of the ERC-20 and ERC-223 standards. It was proposed by Jordi Baylina, Jacques Dafflon, and Thomas Shababi in 2018 as an improvement over the ERC-20 standard, which has become the de facto standard for creating tokens on Ethereum.
One of the main advantages of ERC-777 over ERC-20 is that it includes a new function called "send" that allows for more efficient token transfers. In ERC-20, token transfers require two separate transactions, which can result in higher transaction fees and longer processing times. With ERC-777, token transfers can be completed in a single transaction, which makes it more efficient and cost-effective.
ERC-777 also includes new features for handling token ownership and management, such as an operator system that allows token holders to authorize third parties to perform certain actions on their behalf, and a callback function that can be triggered when a token transfer occurs. These features provide more flexibility and control over token ownership and management, which can be useful for creating complex smart contracts and applications.
ERC-777 is designed to provide a more flexible and efficient token standard for the Ethereum network. While it has not yet been widely adopted, it has gained significant interest from the Ethereum community and may become a popular standard for creating tokens in the future.
What is ERC 827?
ERC-827 is a proposed token standard for the Ethereum blockchain that extends the functionality of ERC-20 and ERC-223 standards by adding support for additional transaction data. It was proposed by Jacques Dafflon, Thomas Shababi, and Jordi Baylina in 2018 as an improvement over existing token standards.
One of the main advantages of ERC-827 is that it allows for more complex transactions involving token transfers and additional data. With ERC-20 and ERC-223, transactions are limited to the transfer of tokens only. However, ERC-827 includes additional data fields that can be used to specify additional information about the transaction, such as a reference number or an invoice ID. This makes it easier to integrate tokens into existing financial systems and applications.
ERC-827 also includes support for a "approveAndCall" function, which allows token holders to approve a transfer of tokens and trigger a function call in a single transaction. This can be useful for creating more complex smart contracts and dApps that require multiple actions to be taken in a single transaction.
ERC-827 is designed to provide a more flexible and extensible token standard for the Ethereum network, and it aims to make it easier to integrate tokens into existing financial systems and applications. While it has not yet been widely adopted, it may become a popular standard for creating tokens in the future.
What is ERC 884?
ERC-884 is a proposed token standard for the Ethereum blockchain that extends the functionality of ERC-20 and ERC-721 standards by adding support for fractional ownership of assets. It was proposed by William Entriken and Robert A. Habermeier in 2018 as an improvement over existing token standards.
One of the main advantages of ERC-884 is that it allows for the fractional ownership of real-world assets, such as property or commodities, to be represented on the blockchain. This can enable the creation of new types of financial products and investment opportunities, as well as provide greater transparency and liquidity for asset ownership.
ERC-884 tokens represent a specific portion of an underlying asset, and can be traded and transferred like other tokens. For example, a piece of artwork could be divided into 1,000 tokens, and each token would represent 0.1% ownership of the artwork. Token holders would be able to transfer and trade their ownership stake in the artwork, providing a new way for investors to participate in the art market.
ERC-884 is designed to provide a more flexible and extensible token standard for representing fractional ownership of assets on the Ethereum network. While it has not yet been widely adopted, it has the potential to enable new types of financial products and investment opportunities in the future.
What is ERC 865?
ERC-865 is a proposed token standard for the Ethereum blockchain that aims to improve the user experience and reduce transaction costs associated with the transfer of tokens. It was proposed by Fabian Vogelsteller in 2018 as an improvement over existing token standards.
One of the main advantages of ERC-865 is that it allows token transfers to be paid for by someone other than the sender, which is not possible with ERC-20 and ERC-223 standards. This means that users can send tokens without having to pay for the gas fees themselves, which can be particularly beneficial for dApps and services that require large amounts of token transfers.
ERC-865 achieves this by introducing a new function called "transferPreSigned", which allows a third party to pay for the gas fees associated with a token transfer. This function requires the token holder to sign a message containing the transfer details, which can then be submitted to the network by the third party. This reduces the amount of gas required for the transfer, as the gas fees can be paid in a more efficient manner.
ERC-865 is designed to provide a more user-friendly and cost-effective token transfer experience on the Ethereum network. While it has not yet been widely adopted, it has the potential to reduce the burden of gas fees for users and dApps that require large amounts of token transfers.
What is ERC 1155?
ERC-1155 is a token standard for the Ethereum blockchain that was proposed by Enjin in 2018. It is a unique token standard that allows for the creation of both fungible and non-fungible tokens within the same contract, which provides significant benefits in terms of efficiency and flexibility.
One of the main advantages of ERC-1155 is that it reduces the number of transactions required to manage multiple types of tokens. Traditionally, creating a dApp that manages multiple types of tokens would require a separate smart contract for each type, which can be cumbersome and inefficient. With ERC-1155, developers can create a single smart contract that manages both fungible and non-fungible tokens, which reduces the overall complexity of the dApp.
Another advantage of ERC-1155 is that it allows for the creation of "semi-fungible" tokens. These are tokens that have some fungible and some non-fungible properties. For example, a game item might have a set of properties that are unique to that item (making it non-fungible), but also have a set of properties that are shared among multiple items (making it fungible). This makes it easier to manage in-game items and provides greater flexibility for game developers.
ERC-1155 also supports "batch transfers", which allow for multiple tokens to be transferred in a single transaction. This can reduce gas costs and improve overall efficiency when transferring large numbers of tokens.
ERC-1155 is a flexible and efficient token standard that provides a range of benefits for developers creating dApps that manage multiple types of tokens. It has been adopted by a number of projects in the gaming and collectibles space, but has potential applications in other industries as well
What is ERC 4626?
ERC-4626 is a standard designed to streamline and standardize the technical parameters of yield-bearing vaults. It introduces a standard API for tokenized yield-bearing vaults that represent shares of a single underlying ERC-20 token. Additionally, ERC-4626 includes an optional extension for tokenized vaults using ERC-20, which provides basic functionality for depositing, withdrawing tokens, and checking balances.
Yield-bearing vaults play a critical role in lending markets, aggregators, and interest-bearing tokens, helping users find the best yield for their crypto tokens. However, the strategies used by different yield-bearing vaults can vary, which can lead to errors and wasted development resources.
By implementing ERC-4626 in yield-bearing vaults, developers can benefit from more consistent and robust implementation patterns, reducing the integration effort and unlocking access to yield in various applications with little specialized effort. In summary, ERC-4626 has the potential to simplify the implementation of yield-bearing vaults, providing a more efficient and effective way to access yield in the Ethereum ecosystem.
Conclusion
ERC standards have played a critical role in the development and growth of the Ethereum ecosystem. These standards provide a set of guidelines and specifications for the creation and implementation of tokens, smart contracts, and other blockchain-based applications.
ERC standards have made it easier for developers to create and deploy new applications on the Ethereum network, while also ensuring that these applications are compatible with other Ethereum-based projects. They have helped to establish a common language and set of best practices for building decentralized applications, which has in turn helped to drive innovation and growth in the blockchain industry.
Today, there are over 50 different ERC standards, covering a wide range of use cases and applications. These standards continue to evolve and expand, as new needs and opportunities arise in the blockchain space.
As the Ethereum ecosystem continues to grow and mature, ERC standards will remain a crucial part of the development process. They provide a foundation for building interoperable and secure applications, and help to ensure that the Ethereum network remains a vibrant and dynamic ecosystem for years to come.
