What is ERC?
While Ethereum’s ecosystem is decentralized, it still requires someone who can set the rules and make the necessary calls for improvements while setting standards that demonstrate the various possibilities of the blockchain. To accomplish all this, Ethereum’s users themselves needed to make EIPs (Ethereum Improvement Proposals), discuss their relevant details, and then vote on whether to begin or reject their implementation.
Now, there exist numerous EIP types for the various categories of additions and improvements. One of these types was defined by Ethereum’s core developers to discuss, propose, and adopt distinct technical standards for token creation, applications, smart contracts, and wallet formats on Ethereum.
This subclass of an EIP got the name ERC, or “Ethereum Request for Comments.” So far, many ERCs have been made to set the standards for the various cryptocurrencies that can be made on Ethereum. With that, every token that is created has to adhere to the standards that such ERCs set. Hence, they are known as ERC tokens.
These days, the three most utilized ERC standards on Ethereum are ERC-20, ERC-1155, and ERC-721. In case you didn’t know, the numbers after ERC simply signify the serial numbers for the “requests for comments,” i.e., the ones to propose such standards.
But what do such standards exactly mean? Moreover, why do people need them in the first place? Let us find out.
What is ERC20?
ERC-20 happens to be the technical standard used to make fungible tokens on the Ethereum blockchain. These fungible tokens are interchangeable with other tokens like them, unlike NFTs, which aren’t interchangeable.
ERC-20 enables developers to make tokens that are smart contract-enabled and can be utilized with other services or products. Such tokens represent an asset, an ownership right, a cryptocurrency, access, or anything that is not unique by itself but is transferable.
History of ERC20
It was in 2015 that smart contracts first started becoming popular, but there were quite a number of issues that still needed to be addressed. Since anyone was able to create a token, several were being made. Nonetheless, there was no way to make sure that every different token could be used, exchanged, or created by everyone utilizing the blockchain. With a lack of a standardized token methodology, all applications would need their own tokens. This would necessitate users finding a method to convert those tokens back and forth amidst the dozens of applications being developed.
This was what led to the ERC-20 being proposed in 2015 by the developer Fabin Vogelstellar to solve the necessity for standards inside smart contracts on Ethereum. Vogelstellar submitted that proposal as an ERC through the GitHub page of the project.
In 2017, following the procedure utilized by the developer community of Ethereum, the proposal got approval and was implemented as EIP-20. However, the reason it is still known as ERC-20 is because of how it was understood until its approval.
Due to the request receiving approval and seeing implementation, smart contract tokens adopted on Ethereum’s blockchain can adhere to such a standard if developers would like for them to include interchangeability.
What is ERC721?
Initially regarded as the lesser-known relative of the ERC-20 standard, the ERC-721 has grown and become a fundamental pillar within the Ethereum ecosystem, supporting NFTs worth billions of dollars.
Much like the ERC-20, the ERC-721 is a kind of standard, serving as a format or template that other developers can agree to adhere to. It is a standard for non-fungible tokens, or NFTs, on the Ethereum blockchain network. Hence, it comes with this set of rules that can make it easier to work with these types of tokens.
Fungible means something that can be replaced or interchanged. For instance, Bitcoin is fungible since any Bitcoin can be replaced with any other Bitcoin. As for NFTs, they are completely unique, and each NFT cannot replace any other.
Additionally, following such identical standards can make writing code easier, more reusable, and more predictable. Furthermore, such standards are entirely voluntary, but adhering to a widely utilized standard entails compatibility with various applications, such as wallets, exchanges, and dApps.
What is ERC721A?
One major element of the ERC-721 token is that it lacks native support for minting many NFTs within one transaction, which is where the ERC-721A token standard comes in. Created by Azuki, the ERC-721A’s primary purpose is to enable the gas-efficient minting of several NFTs within one transaction. Through such implementations, users will save whatever gas fees they incur in the long run, should they mint more than a single token at any given time.
What is ERC1155?
Before ERC-1155, the two most commonly used token standards were ERC-20 and ERC-721. However, they could not be contained within a single smart contract. This meant that should someone wish to transfer some USDC and an NFT, they would have to carry out several transactions, making the endeavor expensive and slow. ERC-1155 addresses this by combining these two token standards. Hence, it is a standard that allows the effective transfer of both non-fungible and fungible tokens within one transaction.
The original motivation behind this token standard was to solve the issues that blockchain game players and developers faced. While there are many use cases for ERC-1155 beyond gaming, gaming can still be a great way to highlight how the token standard works.
MMOs come with hundreds of items that players can gather and exchange with one another. Items like swords are non-fungible, whereas items like coins are fungible. On blockchains, every one of them is represented as a token. Before ERC-1155, every item needed a smart contract for itself. That would translate to 1,000 smart contracts in a game with 1,000 items! It, therefore, makes for a ton of unnecessary redundancy while being an ineffective use of funds and space.
With the ERC-1155 token, several items can be held within one smart contract, and numerous items can be transferred within one transaction to two or more recipients. This implies that if one wishes to transfer a sword to a friend, 100 gold coins, or a shield to someone else, one could do that in only a single transaction.
Comparison Table of ERC
|Standard Name||Standard Type||Use Cases|
|ERC-20||Fungible tokens||Tradeable cryptocurrencies, governance, and staking tokens|
|ERC-721||Non-fungible tokens||Collectable art and property tickets|
|ERC-721A||Multi-token standard||Saving on gas fees, and more|
|ERC-1155||Multi-token standard||Gaming, memorabilia, etc.|
What is Etherscan?
Etherscan happens to be the most trusted tool when it comes to navigating through every single piece of public data on Ethereum and is even referred to as Ethplorer sometimes because of that. This data can include wallet addresses, transactional data, smart contracts, and so much more. It is a self-contained application that is neither administered nor sponsored by the non-profit organization known as the Ethereum Foundation.
The team responsible for Etherscan includes various seasoned industry professionals and developers, i.e., people who have developed the Etherscan application to make Ethereum’s blockchain more accessible for everyday users.
Although Etherscan’s platform is centralized, the application does make it simpler for users to navigate on the Ethereum blockchain. For example, you can calculate the gas fees on Ethereum using its gas tracker, search for and verify smart contracts, monitor the number of smart contracts someone has authorized using their wallets, and a lot more.
What is Ethers.js?
Ethers.js was originally made for “ethers.io.” It has, however, grown to become more of a general-purpose library. Moreover, Ethers.js comes with straightforward and extensive documentation, a smaller bundle size, has been written in TypeScript, and has a more user-friendly API structure. As a result, it has turned into a highly sought-after library for several Web3 developers due to its straightforward and intuitive nature.
Frequently Asked Questions
What is ERC?
You can think of ERCs as a set of standards that developers can agree to follow or implement. These standards represent ways of building the various tokens that exist today.
What is ERC721?
As stated previously, the ERC-721 is a popular token standard that is used to create non-fungible tokens.
What is Etherscan?
Etherscan is an analytics platform or block explorer that enables users to acquire details about any transaction on the Ethereum blockchain that is either confirmed or pending, and much more.