Technical Concepts
ERC-721
Ethereum Request for Comment 721
Standard for creating non-fungible tokens on Ethereum
Definition
ERC-721 is the technical standard for non-fungible tokens (NFTs) on Ethereum. It defines how to create unique, indivisible tokens that can represent ownership of digital or physical assets.
Example
CryptoKitties and most NFT collections follow the ERC-721 standard to ensure compatibility with wallets and marketplaces.
What to check
Treat it as infrastructure: understand what it automates, what trust assumptions remain, and how failures propagate. The main checks are: Standard limitations; Gas costs; Compatibility issues.
Risks to Consider
- Standard limitations
- Gas costs
- Compatibility issues
Common Questions
What does ERC-721 mean in DeFi?
ERC-721 means Standard for creating non-fungible tokens on Ethereum. The useful question is not only the definition, but how the mechanism changes risk, return, liquidity, or governance for the user.
How is ERC-721 used in practice?
A practical example: CryptoKitties and most NFT collections follow the ERC-721 standard to ensure compatibility with wallets and marketplaces.
What should I check before relying on ERC-721?
Check standard limitations, gas costs, compatibility issues. Also verify liquidity, oracle assumptions, admin controls, and whether the protocol has been tested during stressed markets.
