In this quick tutorial we’re going to explore some of the more common token types on the ethereum blockchain. For example, we’ll look at the difference between ERC20, ERC721 and ERC1155 tokens. In this video we’ll explore what these token types are used for and we’ll dive deeper into their important differences?

Also, as a sidenote, If you want to learn how to develop Web3 applications, without having to know how to code, head over to Nebulum and check out our no-code blockchain development course. In this course you’ll learn how to build a huge assortment of web3 applications. For example, we’ll teach you how to build crypto trading bots, defi applications, crypto games, smart contract SaaS applications & peer to peer marketplaces. You’ll also learn how to do things like create forced directional charts that track the early token distribution of a coin and monitor, in real time, for the wallet activity of influencer or whale wallets. And you’ll learn how to do all of this without having to write a line of code. I’ll provide a link to our no-code blockchain development course as well as an enrollment coupon code in the description below.

Okay so let’s jump in.

ERC20 Tokens

First of all, let’s start by talking about ERC20 tokens.

ERC20 tokens are the token standard that most people are familiar with on the ethereum blockchain. ERC20 tokens are fungible tokens, meaning that each token is identical and interchangeable with other tokens of the same type and value. ERC20 tokens can also be divided into smaller units.

So that we’re not speaking in abstractions here, let’s jump over to Etherscan to view the details of some ERC20 tokens. Here if we hover over “tokens” you’ll see that we can view the top ERC20 tokens or view the most recent ERC20 token transactions. So let’s click on “top tokens”.

So here, you’ll see some of the most popular ERC20 tokens at the moment. Here you’ll see USdt, BNb, Wrapped BTC, Wrapped ETH the Uniswap token and so on.

Let’s drill into Wrapped BTC to see some more details about this token. So essentially, wrapped BTC is bitcoin’s representation on the Ethereum blockchain. Because bitcoin’s blockchain isn’t compatible with ethereum’s blockchain, we need to use wrapped coins on the ethereum blockchain to be able to interact and use Bitcoin, or a wrapped version of it anyway.

So this coin is fungible which means that I can send or receive 1 token of this wrapped BTC and both the sent and received token are identical and interchangeable. It’s like if I gave you a dollar and you gave me a different dollar back. I would accept it, because our dollars are interchangeable and I know that your dollar holds the same value as my dollar.

For this reason, ERC20 tokens are most often used as crypto currencies or utility tokens.

Here, on Etherescan we can see the details of this token as a crypto currency. We can see its current supply, the number of holders, the number of transfers, the tokens current price and market cap. Over to the right we can click on this link to be brought to the ERC20 token’s contract page where we could audit the contract, or we could view the most recent transactions of this ERC20 token by looking under this transfers tab here.

If you are on an individual wallet page within Etherscan, you can view a wallet’s ERC20 token holdings by going to this dropdown list here and you’ll notice the ERC20 token holdings for this wallet show up here.

ERC721 Tokens

Okay so how do ERC20 tokens differ from ERC721 tokens?

Well most importantly, ERC72 tokens are Non-fungible. This means that each token is unique and is not interchangeable with other tokens of the same type and value. They are also indivisible. And rather than representing a cryptocurrency or utility token like ERC20’s most often do, ERC721 tokens are often used to represent collectibles such as digital art or gaming items. When you hear the word NFT, or “non fungible token” you’re often hearing about a token that adheres to the ERC721 token standard.

However, one important note here. NFTs or ERC721 tokens do not need to be used to represent digital art. This is just one use case for ERC721 tokens. We’re often familiar with this token standard because of the media coverage around collectibles. However, at their core, ERC721 tokens are simply used to show digital ownership. So an NFT could really be anything. It doesn’t need to be digital art. It could be a real estate or land deed, a university degree, a ticket for an event or concert, an exclusive member’s only pass or a token which proves product authenticity. I’ve seen NFT tokens used for everything from fundraising & supply chain management to personal Ids & loyalty programs.

So when learning about the 721 token standard ensure that you explore it’s use cases outside of the most common current use cases. I think there is huge potential there. So let’s understand this token standard better by once again heading over to etherscan to browse through some recent ERC721 token activity.

To view ERC721 tokens on the blockchain, go to etherscan and hover over NFTs in the top navigation bar. From here, let’s click on “top nfts”. Here, we have an NFT collection called “doodles”. First, notice that the erc721 token standard shows up beside the NFT collection here. So let’s click on this NFT collection now. On this page now we can see the total supply, the number of holders, the total transfers and if we scroll down we’ll see the most recent transactions here. Notice that each doodle has an Id number here. This is this specific NFT’s unique Id within this smart contract. For example, let’s click on this “doodle” here.

Here notice that we can see the NFT’s owners address as well as the contract address, the token id and the token standard here.

If you’re new to NFTs, the best way to think about this is that the contract address is like a container which can hold the individual ids of the NFTs. So for instance, imagine we created an ERC721 token contract. Let’s imagine the contact was called 0x0123. ONce we create the contract, we can’t really do that much. We first need to mint some new Ids within the contract.

So let’s imagine we minted three tokens. We’ll call them id 1, 2 & 3.

https://etherscan.io/nft/0x8a90cab2b38dba80c64b7734e58ee1db38b8992e/8140

So that’s essentially what you’re seeing over here. This NFT is simply the 8140’th token added to this collection.

And also notice that we can’t divide the token id. In this example, the token id is owned by one owner. So this NFT is indivisible.

Also unlike the ERC20 standard where we could transfer two wrapped BTC back and forth and what we would each receive would be virtually identical, we can’t do the same for this nFT here. Notice if we scroll down, that the NFT has properties. For example, it has face, hair and body properties. That means, this NFT isn’t the same as a token from the same contract address or container with a different id. Take the token id from the same collection with the id of 7336. It has a different price, different properties and so on.

So as you can see each item within this collection is unique.

https://etherscan.io/nft/0x8a90cab2b38dba80c64b7734e58ee1db38b8992e/7336

To see a specific wallet addresses ERC721 token holdings, just go over to any address on etherscan, and if the wallet has any ERC72 tokens, they will show up below that wallet’s ERC20 token holdings.

https://etherscan.io/address/0x62baa1cc6ad1a247921183dcc06de78583b51595

For example, I could scroll past these ERC20 token holdings and you’ll notice that after that this wallet’s ERC721 tokens show up here.

Okay, so that’s ERC721 tokens in a nutshell. So what are ERC1155 tokens then?

ERC1155 Tokens

Now let’s talk about ERC1155.

One of the defining characteristics of the ERC1155 token standard is that you can manage multiple token standards within one contract address. So we can work with fungible and non fungible tokens.

Let me give you an example again to make this crystal clear. So previously, in the example we looked at, the owner of the NFT was the owner of an indivisible single NFT. So that logic works for a lot of different use cases. For example in the world of collectibles, that concept works, in land or property ownership, that logic would also work in most cases… but it doesn’t work for all use cases.

What if, for instance, we were building a game and within our game, we wanted to have one item that there was only one of, perhaps a powerful magic potion, but then many other items that were identical and we needed many of them. For example, imagine in our game we needed to populate our game world with 1000 gold swords. So in this case we need to be able to create NFTs that have a balance or quantity property. We would want to mint our magic potion with a total quantity of 1 and our gold swords with a total quantity of 1000.

This is essentially what the ERC1155 token standard allows us to do. And again, we’re talking about game assets as a use case here, but there are many use cases for the 1155 token standard. Essentially anytime you’re trying to build something with varying rarity levels or fractional ownership capabilities… then the ERC1155 token standard is probably what you’re looking for.

Again, over on Etherscan let’s look at an 1155 token on the blockchain.

https://etherscan.io/nft/0x54f456b544abfb785694400bcb1d85629b2d437f/47

Here we have what appears to be an in-game asset. Notice that like the ERC721 standard, we can see the owner of this particular asset. And like the ERC721 token we can see the token Id of 47 here. But this is where the similarities start to end. Because here, you’ll notice that this token id has a quantity of 1066. Also, notice that currently there are over 200 holders of this asset.

So that’s a wrap up of the main differences between the ERC20, ERC721 and ERC1155 token standards. Those are not the only token standards on ethereum, but those are the most popular token standards.

Now, if you want to take your blockchain skills to the next level and learn how to develop Web3 applications that will allow you to earn crypto on autopilot then be sure to check out our no code web3 development course. You’ll learn how to do things like develop visualization tools that allow you to spot buying opportunities before other traders by using force directed graphs. After completing our course you could also do things like develop crypto trading bots, Web3 SaaS applications like OpenSea, blockchain scanners like Etherscan, trading card games and much much more. We have a course walkthrough video over on our site which I’ll link to below. And don’t forget to check out the description below because I might have put a generous course enrolment coupon down there.

Also, before moving on today, don’t forget to hit that subscribe button if you’ve enjoyed this content & learnt something new today, it really helps the channel and it will ensure you stay on the bleeding edge of what’s happening in the blockchain space.

Thanks for stopping by today.