FAQ 20 – What are the types of ERC tokens?
What is a token?
A token is a digital asset that can be issued or traded on a blockchain.
A token has a large number of advantages and characteristics, including:
– The creation of tokens is allowed to everyone,
– The exchange of tokens is easy to carry out and does not require the intervention of a third party or even the need for the sender to keep an original / a copy of his token,
– Token exchanges are secure and do not allow the creation of counterfeits,
– The creation of tokens is generally done using smart contracts,
– Tokens are widely used in the context of ICOs, which stands for Initial Coin Offerings.
A token represents a large number of criteria. Among the most common, you can find those mentioned below.
The value of one token is 0.000000307 EUR.
How does a token work?
A token has two main uses:
– It helps and promotes fundraising for businesses,
– It allows users of the same blockchain to transact with each other.
What is the difference between coin and token?
The coin and the token are two different varieties of currency.
The currency depending on it’s own blockchain is actually called a “coin”.
On the other hand, a currency that can depend on an already existing blockchain is called a “token”.
What are the different types of tokens?
There are different types of token:
Utility tokens are called, in French, “utility tokens”. The possession of these tokens allows the acquisition of goods or services in relation to their estimated values.
Value tokens are called, in French, “value tokens”. These tokens are intended to promote but above all facilitate the investment, within the framework of ICOs, of a blockchain project.
How to use tokens in ICOs?
ICOs represent fundraising operations carried out by companies or non-profit foundations. They are often likened to an alternative to bank financing.
To use tokens in ICOs, companies must issue and sell their tokens to investors, usually online (purchase in cryptocurrency, mainly in Bitcoin). It is thanks to these investors that companies will be able to finance their project.
By having bought the tokens of a company, investors can earn in exchange:
– A share of the dividends generated,
– A kind of ownership over the project,
– They can also benefit from a service, which the company they bought the tokens from will return to them.
What are the different types of ERC tokens?
ERC stands for “Ethereum Request for Comment” or “Ethereum Comment Request”.
ERC tokens are written in smart contracts and are usually published and documented by the IETF (Internet Engineering Task Force).
These numbered documents detail the operating methods of internet protocols or computer hardware.
The most common ERC token is ERC-20, this is the common interface for Ethereum tokens.
There are various ERC tokens:
ERC – 721 :
The ERC-721 helps to create NFTs, games but also allows the tokenization of real estate or works of art.
ERC – 1155 :
The ERC-1155 makes it possible to offer a better experience to its users thanks to its new functions, in particular it makes it possible to modify the landscape of Dapps.
ERC – 827 :
This is considered an extension of the ERC-20 token.
It has the same features as the ERC-20 and adds them to its own.
Among its features, it brings new functionalities on three functions: approve, transfer, Transfer From, in order to allow the transfer not only of the exchange of tokens but also of data of any type, for example photos or videos, documents.
There are plenty of other ERC tokens but above you can find some of the most common in the Crypto world.