ERC-721

Last updated
ERC-721
ERC-721: Non-Fungible Token Standard
ERC-721 Standard.png
ERC-721 illustrated with checkmarks and puzzle pieces representing standardized properties, compatibility and non-fungibility
Year started2017
First published2018
SeriesEthereum Improvement Proposals (EIP)
Authors William Entriken, Dieter Shirley, Jacob Evans, Nastassia Sachs
Predecessor ERC-20
Domain NFTs
Copyright Creative Commons CC0
Website eips.ethereum.org/EIPS/eip-721

The ERC-721 Non-fungible Token Standard is a technical framework, defining a set of rules and interfaces for creating and managing unique, non-fungible tokens (NFTs) on the Ethereum blockchain. [1] [2] [3] ERC-721 is recognized for formalizing the concept of an NFT and establishing the foundation of the multi-billion dollar digital collectibles ecosystem that emerged alongside its adoption. It is one of the most widely used NFT standards across use cases and has been utilized in various high profile projects.

Contents

The development of the standard was a community-driven effort that was formally published into a paper of the same name in 2018 and is accredited to William Entriken and co-authors Dieter Shirley, Jacob Evans, and Nastassia Sachs. ERC stands for "Ethereum Request for Comments," and is a part of the Ethereum community's peer-review process in which new proposals are considered for publication; the "721" is a unique identifier, each proposal is assigned one arbitrarily after an editor approves it in the draft phase. [4] [5] The blockchain game featuring digital cat artworks known as CryptoKitties is credited with pioneering ERC-721 when it achieved mainstream attention shortly after its launch in 2017. [6] [1]

History

Digital collectibles prior to ERC-721

The concept of non-fungible digital assets that could be owned on a blockchain predated ERC-721, with projects like Colored Coins on Bitcoin in 2012. [7] In 2017, just prior to ERC-721’s publication, Larva Labs launched the CryptoPunks NFT project on Ethereum using ERC-20 (a fungible token standard). CryptoPunks served as a direct inspiration for ERC-721’s initial drafting. [1] [8]

Formalizing the term "NFT"

The term "non-fungible token" (NFT) is not known to have been used to refer to NFT projects prior to ERC-721. [9] [10] [11] ERC-721: Non-Fungible Token Standard is credited with formalizing and defining the term NFT. [12]

During the standard's drafting phase, lead author Entriken held a vote among the stakeholders where different words were considered including deed, title and asset, but ultimately "NFT" was chosen for the standard's final publication. [12] [13]

Use of the term's popularity grew through CryptoKitties, the blockchain game featuring digital cats NFT utilizing ERC-721. [10] [9]

Initial adoption

CryptoKitties

The blockchain game CryptoKitties by Dapper Labs of which the CTO Dieter Shirley is a fellow co-author of ERC-721, is recognized as the earliest pioneering and popular instance of the ERC-721 standard. [1] [14] [15] It utilized an early version of ERC-721 that was not fully compliant with the standard published in 2018. [16] CryptoKitties is regarded as among the first NFT applications to achieve widespread adoption, earning millions of dollars initially and taking up to 70% of Ethereum's usage capacity at its height in some moments. [17] [18] [19]

Su Squares

Launched in 2018 by Entriken and inspired by the Million Dollar Homepage, this NFT project is the first fully compliant demonstration of the ERC-721 NFT standard. [20] [21]

NFT marketplaces

In 2017, one of the earliest and most successful NFT marketplaces, OpenSea, was launched by co-founders Alex Atallah and Devin Finzer who intended to capitalize off of the emergence of ERC-721 NFTs on Ethereum. They initially focused on capturing the market activity around the blockchain NFT game CryptoKitties, which was one of the first use cases of ERC-721, and ultimately planned to scale the platform for other emerging projects utilizing it. [22]

With the introduction of ERC-721, it felt like such an idea was possible for the first time.

— David Finzer, How one company took over the NFT trade – The Verge

The NFT marketplace SuperRare also emerged in 2018 to enable trading of tokens of this standard. [1]

Notable functionality

Custom metadata

ERC-721 implementation requires "name" and "symbol" identifiers, and the token is assigned a contract address upon deployment to the blockchain. [23] [24] Also, a mechanism to implement a URI (Uniform Resource Identifier) to the contract, is defined in the standard, providing functionality to assign each NFT unique metadata. [1]

Though not required, most NFTs implementing ERC-721 will also implement the OpenSea Metadata Standard.

Trackable ownership

Trackable ownership is the key feature which adds non-fungibility to the ERC-721 standard. [25] Each NFT is assigned a token identification number, and linked to its owner through the "ownerOf" function. Through the optional "ERC-721 Enumerable" extension, functionality for full ownership tracking is implemented. This differs from the ERC-20 token standard, which only tracks an owners token balance though ERC-721 also tracks it as well. [26]

Security

The ERC-721 standard defines both safe and unsafe transfer functions, offering different levels of security for various implementations. [27] These functions allow transfers initiated by the token owner, or an approved operator of their individual tokens. Further, developers can implement custom logic to these transfer functions, providing the functionality for NFT protocols to operate. For example, marketplaces like OpenSea, make use of approved operators to facilitate the sale of NFTs. [28]

Influence of work

The influence of the paper ERC-721: Non-Fungible Token Standard that Entriken lead authorship of spans across various sectors, profoundly shaping the landscape of digital collectibles and the use cases within the broader NFT eco-system. [24]

ERC-721 was awarded rank #1 in ArtReview's Power 100 in 2021 indicating it as "the most powerful art entity in the world" and being the first non-human entity to be ranked as such. [29] [30]

Derivative standards

Several months after ERC-721: Non-Fungible Token Standard was published, a semi-fungible token standard was introduced, called ERC-1155, that was intended to expand on the functionality and flexibility of ERC-721's purpose. [31]

The same ERC-721 standard is utilized on the Polygon blockchain. [32]

Criticisms

The basic version of the ERC-721 standard, as published in ERC-721: Non-Fungible Token Standard, has been criticized by Omar et al for offering limited functionality for the execution of smart contracts associated with NFTs. [25]

Certain NFT use cases demand some features that are not offered by the standard ERC721 and must be created and arranged; such features include the following options: token creation, token deletion, contract access control, and others.

— Ali et al, A review of the key challenges of non-fungible tokens, [33]

Arcenegui et al. points out possible deficits regarding the user in the ERC-721 basic smart contracts and proposes properties to improve and expand its functionality. [24]

See also

Related Research Articles

<span class="mw-page-title-main">Certificate of authenticity</span> Seal placed on objects (physical or digital) to show they are genuine

A certificate of authenticity (COA) is a seal or small sticker on a proprietary computer program, t-shirt, jersey, or any other memorabilia or art work, especially in the world of computers and sports. It is commonly a seal on paper authenticating a specific art work which and is made to demonstrate that the item is authentic.

<span class="mw-page-title-main">Kevin Abosch</span> Irish conceptual artist

Kevin Abosch is an Irish conceptual artist and pioneer in cryptoart known for his works in photography, blockchain, sculpture, installation, AI and film. Abosch's work addresses the nature of identity, value and human currency and has been exhibited throughout the world, often in civic spaces, including The Hermitage Museum, The National Gallery of Ireland, The National Museum of China, The Irish Museum of Modern Art, The Museum of Contemporary Art Vojvodina, The Bogotá Museum of Modern Art, ZKM, Galerie nationale du Jeu de Paume, and Dublin Airport.

Proof-of-stake (PoS) protocols are a class of consensus mechanisms for blockchains that work by selecting validators in proportion to their quantity of holdings in the associated cryptocurrency. This is done to avoid the computational cost of proof-of-work (POW) schemes. The first functioning use of PoS for cryptocurrency was Peercoin in 2012, although the scheme, on the surface, still resembled a POW.

<span class="mw-page-title-main">Ethereum</span> Open-source blockchain computing platform

Ethereum is a decentralized blockchain with smart contract functionality. Ether is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market capitalization. It is open-source software.

A decentralized autonomous organization (DAO), sometimes called a decentralized autonomous corporation (DAC), is an organization managed in whole or in part by decentralized computer program, with voting and finances handled through a blockchain. In general terms, DAOs are member-owned communities without centralized leadership. The precise legal status of this type of business organization is unclear.

A blockchain is a distributed ledger with growing lists of records (blocks) that are securely linked together via cryptographic hashes. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Since each block contains information about the previous block, they effectively form a chain, with each additional block linking to the ones before it. Consequently, blockchain transactions are irreversible in that, once they are recorded, the data in any given block cannot be altered retroactively without altering all subsequent blocks.

A decentralised application is an application that can operate autonomously, typically through the use of smart contracts, that run on a decentralized computing, blockchain or other distributed ledger system. Like traditional applications, DApps provide some function or utility to its users. However, unlike traditional applications, DApps operate without human intervention and are not owned by any one entity, rather DApps distribute tokens that represent ownership. These tokens are distributed according to a programmed algorithm to the users of the system, diluting ownership and control of the DApp. Without any one entity controlling the system, the application is therefore decentralised.

<span class="mw-page-title-main">Cardano (blockchain platform)</span> Public blockchain platform

Cardano is a public blockchain platform. It is open-source and decentralized, with consensus achieved using proof of stake. It can facilitate peer-to-peer transactions with its internal cryptocurrency, ADA.

<i>CryptoKitties</i> 2017 blockchain game on Ethereum

CryptoKitties is a blockchain game developed by Canadian studio Dapper Labs. The game allows players to buy, sell, and create non-fungible tokens (NFTs) using Ethereum. These NFTs represent virtual cats. The game's popularity in December 2017, congested the Ethereum network, causing it to reach an all-time high in the number of transactions and slowing it down significantly.

Video games can include elements that use blockchain technologies, including cryptocurrencies and non-fungible tokens (NFTs), often as a form of monetization. These elements typically allow players to trade in-game items for cryptocurrency, or represent in-game items with NFTs. A subset of these games are also known as play-to-earn games because they include systems that allow players to earn cryptocurrency through gameplay. Blockchain games have existed since 2017, gaining wider attention from the video game industry in 2021. Several AAA publishers have expressed intent to include this technology in the future. Players, developers, and game companies have criticized the use of blockchain technology in video games for being exploitative, environmentally unsustainable, and unnecessary.

<span class="mw-page-title-main">Non-fungible token</span> Unique and non-interchangeable data

A non-fungible token (NFT) is a unique digital identifier that is recorded on a blockchain and is used to certify ownership and authenticity. It cannot be copied, substituted, or subdivided. The ownership of an NFT is recorded in the blockchain and can be transferred by the owner, allowing NFTs to be sold and traded. Initially pitched as a new class of investment asset, by September 2023, one report claimed that over 95% of NFT collections had zero monetary value.

<span class="mw-page-title-main">Tron (cryptocurrency)</span> Blockchain computing platform

TRON is a decentralized, blockchain-based operating system with smart contract functionality, proof-of-stake principles as its consensus algorithm and a cryptocurrency native to the system, known as Tronix (TRX). It was established in March 2014 by Justin Sun and since 2017 has been overseen and supervised by the TRON Foundation, a non-profit organization in Singapore, established in the same year. It is open-source software.

Sorare is a fantasy sport cryptocurrency-based video game. It was developed in 2018 by Nicolas Julia and Adrien Montfort. There are 3 sports in Sorare: football, basketball, and baseball. It is available for Android, iOS and web browsers.

<i>CryptoPunks</i> Pioneering non-fungible token on Ethereum

CryptoPunks is a non-fungible token (NFT) collection on the Ethereum blockchain. The project was launched in June 2017 by the Larva Labs studio, a two-person team consisting of Canadian software developers Matt Hall and John Watkinson. The experimental project was inspired by the London punk scenes, the cyberpunk movement, and electronic music artists Daft Punk. The crypto art blockchain project was an inspiration for the ERC-721 standard for NFTs and the modern crypto art movement, which has since become a part of the cryptocurrency and decentralized finance ecosystems on multiple blockchains.

<i>Axie Infinity</i> 2018 non-fungible token online game

Axie Infinity is a blockchain game developed by Vietnamese studio Sky Mavis, known for its in-game economy which uses Ethereum-based cryptocurrencies. It has been called 'a pyramid scheme that relies on cheap labor from countries like the Philippines to fuel its growth.'

A rare Pepe or RarePepe is a variation on the "Pepe the Frog" internet meme, itself based on a character created by Matt Furie. The related Rare Pepe crypto project, created by various artists worldwide between 2016 and 2018, was based on the aforementioned meme and traded as non-fungible tokens (NFTs) recorded on the CounterParty platform. A total of 1,774 official cards were released for the project across 36 series.

<span class="mw-page-title-main">Solana (blockchain platform)</span> Public blockchain platform

Solana is a blockchain platform which uses a proof-of-stake mechanism to provide smart contract functionality. Its native cryptocurrency is SOL.

Curio Cards are collectible digital artworks located on the Ethereum blockchain. Created in 2017, Curio Cards are commonly viewed as the first digital art collectibles on the Ethereum blockchain. In October 2021, a complete collection of Curio Cards, including the card "17b" misprint, was sold for ETH393 ($1,267,320) at the Christie's Post-War to Present auction. The collection was tested for security vulnerabilities in September 2021 by softstack.

<span class="mw-page-title-main">Polygon (blockchain)</span> Blockchain and cryptocurrency

Polygon is a blockchain platform which aims to create a multi-chain blockchain system compatible with Ethereum. As with Ethereum, it uses a proof-of-stake consensus mechanism for processing transactions on-chain. Polygon's native token is named POL. POL is an ERC-20 token, allowing for compatibility with other Ethereum cryptocurrencies. It is operated by Polygon Labs.

<span class="mw-page-title-main">William Entriken</span> Civic hacker and solutions architect

William "Will" Entriken (/ˈɛn.trə.kɪn/) also known by the online moniker Fulldecent, is a solutions architect, cybersecurity specialist, financial analyst, general manager, and civic hacker best known for his contributions in blockchain technology and open sourced solutions. He is recognized as the lead author of the landmark Ethereum paper ERC-721: Non-Fungible Token Standard, published in 2018. This paper is recognized for pioneering the foundation of the digital collectibles eco-system by establishing a programming standard called "ERC-721" to create NFTs via smart contracts on Ethereum. It also first formalized and defined the term Non-Fungible Token (NFT) into blockchain nomenclature which was made popular by the blockchain game CryptoKitties; the CTO of that game, Dieter Shirley, is also a fellow co-author of the published paper.

References

  1. 1 2 3 4 5 6 Bamakan, Seyed Mojtaba Hosseini; Nezhadsistani, Nasim; Bodaghi, Omid; Qu, Qiang (2022-02-09). "Patents and intellectual property assets as non-fungible tokens; key technologies and challenges". Scientific Reports. 12 (1): 2178. arXiv: 2304.10490 . Bibcode:2022NatSR..12.2178B. doi:10.1038/s41598-022-05920-6. ISSN   2045-2322. PMC   8828876 . PMID   35140251.
  2. ↑ Chandra, Yanto (2022-11-01). "Non-fungible token-enabled entrepreneurship: A conceptual framework". Journal of Business Venturing Insights. 18: e00323. doi: 10.1016/j.jbvi.2022.e00323 . ISSN   2352-6734. S2CID   248958972.
  3. ↑ "Why People Are Paying Big Money For Virtual Real Estate in the Metaverse". Time. 2022-01-20. Retrieved 2023-12-03.
  4. ↑ "EIP-1: EIP Purpose and Guidelines" . Retrieved 2023-11-20.
  5. ↑ Anett (2021-08-08). "What the heck is EIP and how can I create one ? Ethereum Standards EIP ERC FAQs" . Retrieved 2023-11-20.
  6. ↑ Lindman, Kyle Wood and Taylor (2018-08-21). "Why the next CryptoKitties mania won't be about collectables". TechCrunch. Retrieved 2023-12-03.
  7. ↑ Regner, Ferdinand; Schweizer, André; Urbach, Nils (2022), Lacity, Mary C.; Treiblmaier, Horst (eds.), "Utilizing Non-fungible Tokens for an Event Ticketing System", Blockchains and the Token Economy: Theory and Practice, Technology, Work and Globalization, Cham: Springer International Publishing, pp. 315–343, doi:10.1007/978-3-030-95108-5_12, ISBN   978-3-030-95108-5 , retrieved 2023-11-25
  8. ↑ "Jimbo Chats w/ ERC721 Creator Dieter Shirley About the Technical Origins and Future of Web3". YouTube . Retrieved 2023-11-20.
  9. 1 2 Zimmer, Ben (2021-04-16). "'Fungible': The Idea in the Middle of the NFT Sensation". Wall Street Journal. ISSN   0099-9660 . Retrieved 2023-11-25.
  10. 1 2 Ostroff, Caitlin (2021-05-08). "The NFT Origin Story, Starring Digital Cats". Wall Street Journal. ISSN   0099-9660 . Retrieved 2023-11-25.
  11. ↑ Upson, Sandra. "The 10,000 Faces That Launched an NFT Revolution". Wired. ISSN   1059-1028 . Retrieved 2023-12-03.
  12. 1 2 Ross, Dian; Cretu, Edmond; Lemieux, Victoria (2021). "NFTS: Tulip Mania or Digital Renaissance?". 2021 IEEE International Conference on Big Data (Big Data). pp. 2262–2272. doi:10.1109/BigData52589.2021.9671707. ISBN   978-1-6654-3902-2. S2CID   245956102 . Retrieved 2023-12-03.
  13. ↑ "Reconsider the word "deed" by fulldecent · Pull Request #2 · fulldecent/EIPs". GitHub. Retrieved 2023-11-21.
  14. ↑ Nadini, Matthieu; Alessandretti, Laura; Di Giacinto, Flavio; Martino, Mauro; Aiello, Luca Maria; Baronchelli, Andrea (2021-10-22). "Mapping the NFT revolution: market trends, trade networks, and visual features". Scientific Reports. 11 (1): 20902. arXiv: 2106.00647 . Bibcode:2021NatSR..1120902N. doi: 10.1038/s41598-021-00053-8 . ISSN   2045-2322. PMC   8536724 . PMID   34686678. S2CID   235266255.
  15. ↑ Schroeder, Stan (2017-12-04). "How to play CryptoKitties, the insanely popular crypto game". Mashable. Retrieved 2023-11-21.
  16. ↑ Vereš, Igor (April 2019). "Identification of Unusual Transactions in Blockchain Networks". Slovak University of Technology in Bratislava, Informatics and Information Technologies.
  17. ↑ Regner, Ferdinand; Schweizer, André; Urbach, Nils (2022). "Utilizing Non-fungible Tokens for an Event Ticketing System". Blockchains and the Token Economy. Technology, Work and Globalization. Cham: Springer International Publishing. pp. 315–343. doi:10.1007/978-3-030-95108-5_12. ISBN   978-3-030-95107-8 . Retrieved 2023-11-20.
  18. ↑ "CryptoKitties Mania Overwhelms Ethereum Network's Processing". Bloomberg.com. 2017-12-04. Retrieved 2023-11-21.
  19. ↑ Tepper, Fitz (2017-12-03). "People have spent over $1M buying virtual cats on the Ethereum blockchain". TechCrunch. Retrieved 2023-11-21.
  20. ↑ Sherwood, Sonja. "William Entriken". Drexel Magazine. Retrieved 2023-11-26.
  21. ↑ "Su Squares White Paper". tenthousandsu.com. Retrieved 2023-11-26.
  22. ↑ Brandom, Russell (2022-02-02). "How one company took over the NFT trade". The Verge. Retrieved 2023-11-20.
  23. ↑ Solouki, Mohammadsadegh; Bamakan, Seyed Mojtaba Hosseini (2022-01-01). "An In-depth Insight at Digital Ownership Through Dynamic NFTs". Procedia Computer Science. 9th International Conference on Information Technology and Quantitative Management. 214: 875–882. doi: 10.1016/j.procs.2022.11.254 . ISSN   1877-0509. S2CID   254484607.
  24. 1 2 3 Arcenegui, Javier; Arjona, Rosario; Baturone, Iluminada (2023-08-11). "Non-Fungible Tokens Based on ERC-4519 for the Rental of Smart Homes". Sensors (Basel, Switzerland). 23 (16): 7101. Bibcode:2023Senso..23.7101A. doi: 10.3390/s23167101 . ISSN   1424-8220. PMC   10459112 . PMID   37631638.
  25. 1 2 Ali, Omar; Momin, Mujtaba; Shrestha, Anup; Das, Ronnie; Alhajj, Fadia; Dwivedi, Yogesh K. (2023-02-01). "A review of the key challenges of non-fungible tokens". Technological Forecasting and Social Change. 187: 122248. doi: 10.1016/j.techfore.2022.122248 . ISSN   0040-1625. S2CID   254394090.
  26. ↑ Konagari, Ashritha; Kusuma, Hari Priya; Chetharasi, Sangeetha; Kuchipudi, Ramu; Babu, Palamakula Ramesh; Murthy, T Satyanarayana (2023). "NFT Marketplace for Blockchain based Digital Assets using ERC-721 Token Standard". 2023 International Conference on Sustainable Computing and Smart Systems (ICSCSS). pp. 1394–1398. doi:10.1109/ICSCSS57650.2023.10169350. ISBN   979-8-3503-3360-2. S2CID   259365536 . Retrieved 2024-01-13.
  27. ↑ Le, Tralyn; Kim, Yoohwan; Jo, Ju-Yeon (2019). "Implementation of a Blockchain-Based Event Reselling System". 2019 6th International Conference on Computational Science/Intelligence and Applied Informatics (CSII). pp. 50–55. doi:10.1109/CSII.2019.00016. ISBN   978-1-7281-2553-4. S2CID   208631654 . Retrieved 2024-01-13.
  28. ↑ "OpenSea Developer Documentation". OpenSea Developer Documentation. Retrieved 2023-11-30.
  29. ↑ Abrams, Amah-Rose (2021-12-01). "Non-Fungible Tokens Are Deemed the Most Powerful Entity in the Art World in ArtReview's 2021 Power 100 Ranking". Artnet News. Retrieved 2023-11-22.
  30. ↑ "Nonhuman Entity Tops 2021 Edition of ArtReview's Annual Power 100". artreview.com. Retrieved 2023-11-22.
  31. ↑ Madine, Mohammad; Salah, Khaled; Jayaraman, Raja; Battah, Ammar; Hasan, Haya; Yaqoob, Ibrar (2022). "Blockchain and NFTs for Time-Bound Access and Monetization of Private Data". IEEE Access. 10: 94186–94202. Bibcode:2022IEEEA..1094186M. doi: 10.1109/ACCESS.2022.3204274 . S2CID   252094824.
  32. ↑ Sutopo, A. H. (2023). Blockchain Programming Smart Contract on Polygon (p. 58). Topazart.
  33. ↑ Ali, Omar; Momin, Mujtaba; Shrestha, Anup; Das, Ronnie; Alhajj, Fadia; Dwivedi, Yogesh K. (February 2023). "A review of the key challenges of non-fungible tokens". Technological Forecasting and Social Change. 187: 122248. doi: 10.1016/j.techfore.2022.122248 .
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.