Non-fungible tokens have defined a new era in the digital space. Their introduction caused them to spread like wildfire. They serve numerous purposes, from asset representation to security, video gaming, music production, supply chain, and logistic. The big reason is that they give people a way to make money by digitizing assets and proving who owns a physical item.
It is noteworthy that these tokens thrive on complex computational programs called standards. Artistes relate more to standards than users because of the different specifications. Therefore, this article explains NFT standards and how to choose the best for your project.
What Are Token Standards?
Token standards are high-level machine programs that allow cryptographic tokens to be created in a network. So far, there are numerous token standards today, but the ones related to this article are:
- Fungible token standards
- non-fungible token standards
- Semi-fungible token standards
They operate on several cryptographic networks and have extensive utilities. Notably, Ethereum is the largest decentralized ecosystem with token standards.
While the above-listed standards are essential in the digital space, we will focus on Non-fungible token standards.
About NFT Standards
While NFTs are cryptographic tokens with unique identities and addresses, NFT standards are rules that creators must follow to create NFTs. These cryptographic programs are foundations that power the possibilities attached to non-fungible tokens– ranging from validating the owners of assets to monitoring art pieces, keeping assets tamper-proof, and ensuring end-to-end security.
How NFT Standards Work
NFT standards are the driving force for NFTs. Therefore, it is essential to know how these standards work.
The ERC-1155 is an all-in-one standard on the Ethereum blockchain. It is a pack of cryptographic codes that direct the establishment of unique, non-unique, and semi-unique tokens. Its design allows more than 133 assets to be transferred between wallets at once. This feature makes gas costs to be lessened and helps the network to stay decongested.
Transaction recording procedures on this protocol differ from others, such that it does not keep transaction histories. The reason is that the assets in every contract individually record their histories.
The TZIP-12 protocol originates from the Tezos decentralized network. It is compatible with various token kinds and allows users leverage over them. This protocol can transform an IFPS-extracted hash into a token on the Tezos network. It functions similarly to other NFT protocols and provides a competitive gas price for transactions. And it is simple to use.
The Flow standard, designed with the Cadence programming language, operates in the Flow ecosystem. The standard works like the ERC-721 and is especially for artists, games, and other collectibles. It intensely competes with other NFT protocols on Ethereum with its transaction charges and speed.
The ERC-721 standard is a protocol for NFTs on Ethereum’s network. It allows its tokens to record transactions and accommodate extensive data. The protocol aids the registration of copyright ownership and royalty payments on tokens. Apart from Ethereum, the standard is compatible with other blockchains like Avalanche and allows creators to develop NFTs on those platforms with its framework.
This standard performs similarly to other Ethereum-based protocols like the ERC-721 and ERC-1155. It powers both unique and non-unique tokens; hence, called a programming language that hosts a myriad of assets. So, the tokens under this standard can be organized into bundles of assorted assets and sold.
As earlier stated, the standard operates synonymously with the ERC-721 and ERC-1155. However, the difference between them is that while:
- The ERC-721 allows one asset per token, and
- The ERC-1155 blends unique, non-unique, and semi-unique tokens into one contract,
- The ERC-998 combines several pieces of the unique and non-unique tokens as a single token.
The Tron-based NFT standard works like the ERC-721. Each token existing on it is unique and does not cost much transaction fees. The standard has high cost-effectiveness because transactions within Tron’s ecosystem are always less than a dollar. Creating a TRC-721 asset requires a wallet balance of 350 TRX and more. Once it is issued, the NFT name and ticker can be personalized.
The BEP-1155 models Ethereum’s ERC-1155. However, it works on Binance’s network. It can immediately release multiple tokens onto a crypto contract and allow atomic cross-chain trades. The working features of this protocol are that:
- It processes transactions at high speed.
- It can verify transactions before the blocks are created.
- Its gas costs can be as low as 21 cents.
How To Choose One
Now that you have seen the various NFT standards and how they function, you may be puzzled by the question of which standards is the best for you. Consider these factors when choosing the best standards for your project.
- Network charges
- Compatibility with your project
- Network speed
You might get all these features in one standard.
Frequently Asked Questions
Are All Token Standards NFT Standards?
Not every token standard is an NFT standard because there are different types of token standards.
What Is The Difference Between ERC-998 And ERC-1155 Standard?
The ERC-998 Standards combines several tokens from Ethereum’s fungible and non-fungible standards in an ERC-998 token, while the other puts NFTs, SFTs, and fungible tokens in a crypto contract.
What Is The Future For NFT Standards?
NFT standards are one of the best innovations that happened to the crypto space. And as time goes on, improvements are expected to occur because NFTs are becoming useful daily.
What Is The Market Size of NFTs?
The NFT market currently has a market size of about $3.3 billion with over $41 billion worth of NFTs sent over the market since January. However, predictions have it that the NFT market should be worth over $13 billion in 2027.
NFT standards are the bases on which NFTs operate. From the list above, most of the non-Ethereum NFT protocols are modeled after Ethereum’s non-fungible token standards. Although there are quite a few standards in the crypto industry at the moment, it is believed that more blockchains will create theirs.
However, before more networks develop their standards, you can easily choose from the ones available. Compare your intentions with the standard’s features to pick the best.