What Are ERC 20/ERC 721/ERC 1155? What Are the Differences Between Them?

ERC-20 is the standard used to create and launch tokens on the Ethereum (ETH) blockchain network.

ERC stands for "Ethereum Request For Comments" and the number 20 stands for the special identification number. ERC-20 refers to the scripting standard used on the Ethereum blockchain network. It shows the steps needed to implement the rules that an Ethereum token or smart contract must follow. Tokens or smart contracts to be produced on the Ethereum blockchain network must comply with the ERC-20 standard.

ERC-20 is divided into two:

Mandatory Standard
Optional Standard

All tokens on the Ethereum network that are expected to be functional must meet mandatory standards. Mandatory standards form the infrastructure for smart contracts. Project developers need to have an equal amount of ETH, the native cryptocurrency of the Ethereum network. Once this equality is achieved, the transfer process begins.

The amount to be transferred is controlled through smart contracts. The system known as the transfer form is then activated to carry out the transfer. When all these conditions are met, the transfer takes place.

How Does ERC-20 Work?

ERC-20 standard is created, generated, and works on the Ethereum network.

ERC-20 aims for a simple, fast, and secure ecosystem. Tokens working on the Ethereum network have higher traceability and transactions are fast. In other standards, when a token is newly created, the whole system is recreated from scratch, which can be time-consuming.

Since ERC-20 has already set its standard, the newly produced tokens adapt more easily and therefore a faster system is achieved.

What Are the Features of ERC-20 Assets?

ERC-20 is known as part of the Ethereum network. ERC-20 tokens are generated and work on the Ethereum network.

The function of tokens working on the ERC-20 standard is controlled by smart contracts. Smart contracts eliminate the need for a person or organization to operate the token. Functions include smart contract information, such as which wallet addresses the tokens are transferred between.

What Is ERC-721?

ERC-721 is the standard that describes how unique tokens can be created on the Ethereum blockchain ecosystem. ERC-721 tokens are unique, non-interchangeable, and non-fungible. ERC-721 tokens cannot be used in exchange transactions because they do not have similar values. ERC-721 is a technical guide for the creation of unique tokens.

ERC-721 enables the representation of unique works of art in the digital world, and this representation can be proven through the blockchain network. Many blockchain networks publish token standards that are similar to ERC-721.

Movable and immovable assets such as houses, works of art
Collections created virtually
Assets with a negative value, such as credit

Symbolizes ERC-721 tokens.

How Does ERC-721 Token Standard Work?

The ERC-721 Non-Fungible Token Standard was created by William Entriken, Dieter Shirley, Jacob Evans, and Nastassia Sachs with the Ethereum Improvement Proposal (EIP). The Ethereum Improvement Proposal refers to the improvement proposals available on the Ethereum network. Transactions with ERC-721 are added to smart contracts, and ERC-721 standards use smart contracts on the Ethereum blockchain network. To create an ERC-721 token, the contract must be compliant with ERC-721 and ERC-165.

Why ERC-721 Important?

ERC-721 is considered private because it cannot be traded. Assets created with ERC-721 are unique. The ERC-721 standard enables the creation of assets such as NFTs through smart contracts.

Tokens created with ERC-721 have a different value.
ERC-721 tokens can be created in the same way as other tokens, but tokens created with the ERC-721 standard have a unique value.
It provides many functions such as transferring tokens from one account to another, retrieving an account's current token balance, and finding the total supply of tokens available on the network.

ERC-721 and NFT Relationship

The ERC-721 standard is used for the production of NFTs on the Ethereum blockchain network. Through ERC-721, users can convert their unique digital artifacts into NFTs on the Ethereum network, giving them rights to their digital artifacts.

What Is ERC-1155?

ERC-1155 refers to a standard required when creating cryptocurrencies on the Ethereum blockchain network. However, ERC-1155 is also known as the multi-cryptocurrency standard. It is a hybrid of the ERC-20 and ERC-721 standards, which are frequently preferred in Ethereum formations, and includes important features for many industries, including gaming and NFT sectors. With the ERC-1155 standard, transactions can be grouped.

ERC-1155 tokens are trusted tokens and can be traded with ease. They are resistant and protected against cyber hackers. Exchangeable cryptocurrencies can be created on different platforms through ERC-1155.

How Did ERC-1155 Emerge?

ERC-1155 is based on the EIP-1155 proposal presented in 2018 by Witek Radomski, Andrew Cooke, Philippe Castonguay, James Therien, Eric Binet, and Ronan Sandford. ERC-1155 is an upgrade and update of all legacy token standards, including ERC-20 and ERC-721. ERC-1155 includes more secure regulations that make transactions more efficient. Transactions are grouped, reducing token transfer costs.

What Are the Features of ERC-1155?

The ERC-1155 standard provides a great advantage for the gaming world in the most general sense. In games that include products such as equipment, currencies, food, raw materials, and resources, allow these products to be bought and sold more easily and cheaper. Under natural conditions, thousands of players interacting with hundreds of contracts can sell in-game equipment and resources. But in the ecosystem of a game built using ERC-1155, players can buy and sell all in-game goods as a bundle by interacting with a single contract.

What Are the Basic Features of ERC-1155?

Bulk Transfer: It is the ability to transfer multiple assets with a single transaction.
Batch Balance: It is the ability to learn all account balances with a single transaction.
Batch Approval: Approval of all assets from one address.
NFT Support: An asset is considered NFT if its supply is 1.
Reliable Transfer Rule: Rules required for more secure transfers.

ERC-1155 and NFT Relationship

The ERC-1155 standard is used to create NFTs as well as unique tokens on the Ethereum blockchain network. ERC-1155 and ERC-721 are the standards used to generate NFTs.

What Are the Differences Between ERC-1155 and ERC-721?

Both are used for the generation of NFTs. However, there are differences between ERC-1155 and ERC-721:

ERC-1155 can support different cryptocurrencies on the same smart contract. Therefore, compared to ERC-721, ERC-1155 is easier to use, less costly, and can handle transfers of different cryptocurrencies.
The ERC-1155 standard has a higher transaction speed than the ERC-721 standard.
In the ERC-1155 standard, if the transfer is not completed, control of the asset passes back to the sending user. In the ERC-721 standard, if the asset is sent to the wrong address in the transfer operations, the asset cannot be retrieved.