Tokens on Ethereum are digital assets that conform to specific standards, such as ERC-20 for fungible tokens and ERC-721 for non-fungible tokens (NFTs for short, or Collectibles). These standards facilitate the creation, management, and interoperability of tokens within the Ethereum ecosystem. Tokens can represent a wide range of assets, including cryptocurrencies, utility tokens, and digital collectibles.
Interacting with tokens
You can interact with tokens by using Family and decentralized applications (dApps). Family allows you to view your token balances, send and receive tokens, and manage token approvals. dApps enable you to participate in various token-related activities, such as trading tokens on decentralized exchanges, staking tokens in DeFi platforms, or buying and selling collectibles on marketplaces.
Token standards and use cases
Ethereum offers different token standards for diverse functionalities: ERC-20 is widely utilized for fungible tokens, like cryptocurrencies and utility tokens, which maintain a uniform value and are interchangeable. In contrast, ERC-721 and ERC-1155 cater to non-fungible tokens (NFTs), representing unique digital assets like art, collectibles, or virtual property. These NFTs have grown popular owing to their ability to provide verifiable ownership and digital scarcity. Additional standards like ERC-777 and ERC-1400 add features such as enhanced security, compliance, and tokenization of tangible assets.