Token standards are just one of the many things that make cryptocurrency run smoothly. A token standard sets out the requirements that token projects must comply with to transact on a blockchain. A token standard is a set of rules that an Ethereum-based token must comply with. With standards in place, a token can be created, issued, and deployed on the blockchain, and can communicate with smart contracts.
However, not all token standards are alike. Different standards are created for different needs, and, as a developer, it’s best to know which standard fits your project. In this article, we’re going to compare two different token standards: ERC-721R and ERC-1155. This way, you can have a better idea of their capabilities, and which one you should use for your project.
What Is ERC-721R?
ERC-721R is a token standard developed by CryptoFighters Alliance, based on the original ERC-721 token standard. Governing non-fungible assets, it was developed in response to the growing frequency of “rug pull” scams, intended to protect users from such scams.
To that end, Its main feature is trustless refunds. That means, within a given period of time, an NFT minter may get a refund of their minted token with no questions asked – this makes it much easier to dodge a rug pull. If the minter is suspicious of the project, they can simply get the refund and come out with their investment mostly intact. The only thing they lose is the gas fees.
This allows buyers a greater level of confidence and gives creators better legitimacy. A skeptical buyer can be assured that they’ll get their investment back, and that the creator is likely not going to do a rug pull. This helps foster trust in the developer. A developer also fosters trust by using ERC-721R because of that assurance, and also because someone using this token standard is probably not going to do a rug pull.
Another feature is that ERC-721R was built on ERC-721A. Thus, it also has that token standard’s headline feature: low-cost NFT minting. You can mint tokens on ERC-721A at half as much as the regular price on ERC-721, but the real benefit is that subsequent mints only increase the price by a very small amount. Subsequent mints on ERC-721 double the original price, so ERC-721A represents significant cost savings over the original. This allows a user to mint multiple NFTs for almost the price of one.
The first mints are already below market price, and subsequent mints also stay below – allowing a user to mint multiple NFTs for almost the price of one.
The Malicious Refund Problem
Trustless refunds present another problem pointed out on Twitter. Theoretically, a user can simply mint a bunch of NFT and sell them as usual. The moment that any token falls below floor price, they can refund it.
ERC-721R’s developers are aware of this possibility, but they don’t consider it a problem. They point out that the option to refund is the whole point of ERC-721R. If a buyer does not have enough confidence to continue with the project, the developers fully expect them to refund. Further, they also point out that the possibility of a refund also secures the floor price as long as the refund period lasts since no minter will sell below the mint price when they can get a refund instead.
The standard itself also helps protect from against malicious refunders. ERC-721R allows developers to determine how long the refund period lasts and how much of the initial investment is refunded. Devs can set the refund amount to be lower than mint price, thus ensuring that they don’t take a total loss from malicious refunders.
What Is ERC-1155?
ERC-1155 is a token standard developed for blockchain gaming.
Video games present unique challenges that most token standards do not address. For example, a video game may need to transfer many types of tokens representing its game assets over the normal course of play.
Other standards require having a smart contract for every token type that the game needs to move. This drives gas fees through the roof and slows computation speed. An ERC-1155 smart contract can handle any number of token types with no limits, thus saving on gas cost and computing efficiency.
ERC-1155 is also the only token standard that supports semi-fungible tokens. SFTs have attributes of both fungible and non-fungible tokens – each SFT is distinct but can be duplicated.
A good example is event tickets. Each individual ticket is fungible, so while there may be different ticket types at different prices, they’ll all admit you into the event. After it’s been used, the ticket is just a piece of memorabilia. SFTs function similarly, switching from fungible to non-fungible, depending on what the developer has planned for them.
ERC-1155 also includes some other additional features:
- Batch transfers: A transaction can move different types of tokens instead of having to do separate transactions for each token type.
- Batch balance: A transaction can show you the balance of all contained digital assets in a single call.
- Batch approval: A transaction with multiple types of tokens can be approved in one action instead of doing it separately for each token type.
- NFT support: A transaction containing a token whose supply is 1 is assumed to be an NFT and is treated as such.
- Safe transfer rules: Any transaction that trips an error or is improperly filled out gets automatically reverted.
ERC-721R vs ERC-1155: Which To Use?
Their major difference is that an ERC-721R smart contract governs only non-fungible tokens, while an ERC-1155 smart contract governs fungible, non-fungible, and semi-fungible tokens. Thus, they’re only comparable where they overlap: in governing NFTs.
In this specific area, minting and transaction prices are roughly comparable between the two. It’s really up to your purposes whether ERC-721R’s low-cost minting and trustless refunds outweigh ERC-1155’s batch transaction capabilities.
Which one you should use for your project depends on your needs. If your project will have users transacting with all types of tokens, ERC-1155 is the better choice. However, if you’re entirely focused on NFTs, ERC-721R is a compelling alternative.
ERC-721R is also ideal for any project that aims to mint a lot of NFTs. Its refund functionality will increase buyer trust in your project, especially for devs who don’t want to doxx. reveal their real identities for whatever reason.
Meanwhile, ERC-1155 is better for projects that need to control and move multiple types of tokens at once. This can range from video games to decentralized apps to artistic projects – just about anything that uses a bundle of multiple token types.
With these in mind, consider carefully which standard is better for your project.
Knowing which token standard to use for your crypto project can help you save a lot of time, effort, and gas fees. You can also take advantage of the unique capabilities these standards offer you. Check out Tokenfy for more ways we can help you launch your crypto project!