From ERC20, 721, 1155 to 3525, detailing the path of RWA towards large-scale landing in Web3

Since the birth of blockchain technology in 2008, the crypto market has experienced rapid development. However, the total market capitalization of the entire crypto market has yet to surpass that of Apple Inc., and Web3 still lacks practical applications in the real world. Nevertheless, a recent research report from Citibank titled "Money, Tokens, and Games" may change this situation. The report views the tokenization of real-world assets (RWA) as the main narrative for the next phase, believing it could have a significant impact on the development of Web3, driving the blockchain and Web3 industry to reach the next billion users and potentially bringing about economic activities worth trillions of dollars.

In the grand narrative of RWA, the ERC-3525 standard exhibits immense potential. As a semi-fungible token (SFT) standard, it combines the features of ERC-20, ERC-721, and ERC-1155, allowing for more effective representation and management of complex assets such as bonds, coupons, invoices, futures, options, and ABS. In this way, ERC-3525 is expected to facilitate the development of RWA and promote the widespread application of Web3 in the real world.

This article will compare the components of ERC-20, ERC-721, ERC-1155, and ERC-3525 to understand the differences between these token standards. It will then explore the digital world modeling concepts of ERC-3525 from three levels, and finally look ahead to the application areas of ERC-3525 that are worth关注.

Comparison of Existing ERC Token Standards - How to Understand ERC-3525?

ERC-20

ERC-20 is one of the most widely used token standards on Ethereum, which refers to fungible tokens. Each token is equal in function and value, with no distinctions. Stablecoins are an important example of ERC-20 applications.

Key components:

• address: the address of the designated asset owner
• value: represents the amount of tokens owned by this address

Key Advantages:

• Interchangeable assets, such as traditional currencies or shares
• Widely used in DeFi applications
• Can perform non-integer splits

Limitations:

• Cannot represent unique or non-fungible assets

ERC-721

ERC-721 describes the creation and management of non-fungible token (NFT) on the Ethereum blockchain. Each ERC-721 token is unique and non-replaceable, making it suitable for representing unique digital or real-world assets.

Key components:

• tokenId: unique identifier, distinguishes different tokens
• owner: the address of the token owner

Features and Advantages:

• Non-fungible, each token is unique
• Suitable for representing unique items or assets

Limitations:

• Cannot represent interchangeable assets
• Poor liquidity and composability
• Non-divisible

ERC-1155

ERC-1155 is a multi-instance token standard that combines the features of ERC-20 and ERC-721. It allows for the management of multiple tokens within a single smart contract, where each token can be either fungible or non-fungible.

Key components:

• id: unique identifier, distinguishes different tokens
• value: The number of tokens for a specific id
• owner: The address of the token owner

Features and Advantages:

• Can represent both fungible and non-fungible assets at the same time.
• Very useful in applications like games

Limitations:

• Achieve relatively complex
• Cannot represent partially exchangeable assets
• Non-integer splitting is not allowed.

ERC-3525

ERC-3525 is a semi-fungible token standard (SFT) that combines the characteristics of ERC-20, ERC-721, and ERC-1155. It can express and manage complex digital financial assets such as securities, bonds, options, etc., with stronger composability.

Key components:

• id: Unique Identifier
• value: The quantity nature of the token
• Slot: represents category
• Address: Address with Slot and ID

Features and Advantages:

• Can represent various complex numerical structures
• Each token can have its own characteristics and rules
• Support for ID to ID transfers
• Can perform non-integer splits and combinations

Limitations:

• The understanding threshold and development difficulty are relatively high.
• Relatively centralized in terms of technical structure.

Understanding ERC-3525 as a Digital World Modeling Concept from Three Perspectives

ERC-3525 represents a digital world modeling concept that can be understood from three levels:

Splittable and Combinable Super NFT

ERC-3525 can express three token standards: ERC-20, ERC-721, and ERC-1155, and can achieve true splitting of NFTs. This provides the possibility to create more complex token structures.

Universal Digital Container

ERC-3525 can serve as a universal digital asset container, where any digital asset can be placed to form a uniform "solution". This container can be split and combined, making it very suitable for expressing structured financial assets.

Visual Smart Contract

ERC-3525 has visual characteristics that can clearly display all information and changes within the container. This enhancement of transparency, combined with the automatic execution of smart contracts, can significantly improve transaction security and trust, preventing the accumulation of systemic risks.

Future Application Areas of ERC-3525 Worth Paying Attention To

Real World Assets on Chain ( RWA )

ERC-3525 has significant advantages in representing real-world financial assets, especially in areas such as supply chain finance. It enables the tokenization of accounts receivable, addressing the financing challenges faced by small and medium-sized enterprises, and enhancing the liquidity and composability of supply chain finance.

virtual assets or commodities

ERC-3525 can be used to represent digital goods such as virtual land, upgradeable game items, and virtual membership cards. Especially in terms of customer loyalty programs, ERC-3525 shows great potential and may become a key scenario for driving large-scale applications of Web3.

Social, Identity Domain and Tokenized Accounts

ERC-3525 has advantages in areas such as expressing social graphs and implementing soul-bound tokens (SBT). In addition, it can itself serve as a feature-rich "wallet," providing possibilities for more innovative applications.

Summary

ERC-3525, as a split-combinable super NFT, universal digital asset container, and visual smart contract, has significant advantages in addressing the value packaging issues of digital assets. It shows great potential in multiple fields such as RWA, customer loyalty programs, and gaming, especially in subfields of RWA like supply chain finance, where it has advantages over other standards.

Although ERC-3525 currently faces challenges such as high cognitive thresholds and development difficulties, its potential is enormous and deserves our continued attention. We look forward to ERC-3525 playing an important role in the large-scale applications of Web3 in the future.