What is ERC 1155 and How does it Work?
You might have come across the ERC1155 being referred to as the standard for creating NFTs, which is true, but ERC-1155 is more than just a token standard.
The ERC-1155 has set the stage for multi-token management and transactions. With ERC1155, single deployed contracts can include varied combinations of non-fungible, fungible, and semi-fungible tokens.
Whether you are a newbie to decentralized software development or NFT artistry, it is essential to understand the fundamentals of the ERC-1155 and what it can offer.
In this article, I will share insights into the ERC-1155 token and how it works.
• ERC-1155 tokens were developed by Enjin.
• Each ERC-721 token is unique and represents a single asset.
• It removes the need to “approve” individual token contracts separately, which means signing fewer transactions.
• It can be used to represent assets or items across Enjin’s ecosystem of blockchain games. So one asset can be used in multiple games.
So what is ERC-1155 and how does it work?
SEE ALSO: Best 10 ERC20 Tokens On the Market
What is ERC1155?
All updates to Ethereum go through the Ethereum Improvement Proposal (EIP) process. Anyone from the community can submit a proposal. If it meets certain standards, it becomes an EIP which is then discussed and voted on. If the proposal passes, Ethereum is updated with this improvement.
“ERC” stands for Ethereum Request for Comments. It is a type of EIP focused on standards for Ethereum applications, a category that includes tokens.
Developed by the Enjin team, this ERC-1155 token standard took inspiration from token standards like ERC20 and ERC721 tokens coupled with new features of its own.
Previously, under ERC-20 or ERC-721, you had to deploy a separate contract for each fungible or non-fungible token. This causes Ethereum’s blockchain to be riddled with redundant bytecode.
Also, by separating each contract into individual addresses, the older standards limited certain functionalities.
For the NFT and wider token ecosystem to grow and expand into other applications, it was clear that the community needed to create a new standard.
If gaming platforms and other types of token-based dApps (decentralized applications) wanted to include NFTs into the mix, they would have to find a new way to minimize the volume of transactions and the inefficiencies of the contracts. As a result, ERC1155 was born.
With ERC1155, it is now possible to transfer different types of tokens in a single instance, saving on transaction costs. Moreover, it is also possible to create trades in the form of atomic swaps and escrows of multiple tokens on top of the ERC1155 standard.
The system no longer needs to approve token contracts individually as ERC1155 has eliminated this limiting step.
How Does ERC-1155 Function?
The initial motivation behind ERC-1155 was to address challenges faced by blockchain game developers and players. Before ERC-1155, the two predominant token standards were ERC-20 for fungible tokens and ERC-721 for non-fungible tokens.
They could not (and cannot) be wrapped into the same smart contract. What this simply implies is that if someone wanted to transfer two or more different tokens, they would have to execute multiple transactions, which was so inefficient and expensive.
There are other examples of ERC-1155 being used especially in gaming and so we will be using it as our reference to understand how this ERC-1155 functions.
Massively multiplayer online games (MMOs) contain tens of thousands of items—armor, weapons, shields, skins, coins, badges, castles, etc—that players can collect and trade with one another.
Some items like coins are fungible while others like a sword are non-fungible. On the blockchain, each one of these items is a token. In a game with 100,000 items that means 100,000 smart contracts!
ERC-1155 developer Witek Radomski described it as needing a different phone for each app you use. It creates lots of unnecessary redundancy and is an inefficient use of space and money.
So with an ERC-1155 token, multiple items can be stored in a single smart contract and any number of items can be sent in a single transaction to one or more recipients. This means if you wanted to send a sword to one friend, a shield to another, and 100 gold coins to both, you could do so in only one transaction.
Frequently Asked Questions (FAQs)
Can I use Trustwallet to store my ERC-1155 tokens?
Yes, you can keep your assets in Trust Wallet because works effectively with the ERC-1155 system.
What’s so special about ERC-1155?
- ERC-1155 not only allows you to transfer multiple token types at once but also offers efficiency gains and lower transaction fees.
- It supports an infinite number of tokens, contrary to ERC-20 and ERC-721 which require a new smart contract for each type of token.
- It eliminates the need to approve individual token contracts individually, which means that you sign fewer transactions.
Is ERC-1155 better than ERC-20 and ERC-721?
Although ERC-20 and ERC-721 are efficient protocols for creating fungible and non-fungible valuables, respectively, the ERC-1155 has more capabilities.
It combines their operation systems with added possibilities like multiple token releasing and cross-standard single-contract compatibility.
What is the difference between ERC-1155 and ERC-721?
The difference between ERC-1155 and ERC-721 is that ERC-1155 allows various tokens to reside on a contract, while the other is limited to one token per contract.
Also, ERC-1155 reduces transaction times and charges.
Where can I get an ERC-1155 wallet address?
You can use the Enjin wallet to obtain an ERC-1155 address. They are available on the Android and Apple application stores.
Although it has been around for more than four years, ERC-1155 is regarded as the new frontier for token designs because of its unmatched advantages. It allows multiple assets from similar and different standards to interact and work on the same contract.
Semi-fungibility is one of the primary innovations of ERC-1155.
The protocol is designed such that developers can build tokens that can switch their fungibility statuses. It allows more than one user to collaborate on various projects within the same crypto contract.
Although this standard is still looking so new in the blockchain space, it’s only a matter of time before it becomes the new normal.
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