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2. Intermediate Course

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  1. 1. Ethereum 2.0 - What is it? 
  2. 2. What is cryptocurrency burning?
  3. 3. How to create your own cryptocurrency? 
  4. 4. Blockchain Oracle - what are oracles? 
  5. 5. How to make money with NFT?
  6. 6. What is an ERC20 token and how is it created?
  7. 7. The Metaverse – a new virtual world
  8. 8. Metaverse – TOP 15 virtual reality projects
  9. 9. Technical analysis – is it worth using?
  10. 10. What are DeFi liquidity pools?
  11. 11. Second layer (layer 2) - what is it? 
  12. 12. What are wrapped tokens 
  13. 13. What is the Lightning Network, and how does it work?
  14. 14. What are security tokens?
  15. 15. What is Play-to-Earn (P2E) and how does it work?
  16. 16. What are Social Tokens? 
  17. 17. Examples of the use of WEB3 on the blockchain
  18. 18. What is Web5? 
  19. 19. Ethereum London Hard Fork - what is it ? 
  20. 20. Segregated Witness - what is Segwit Bitcoin all about?
  21. 21. Polkadot - Decentralized blockchain and DOT cryptocurrency
  22. 22. Polkadot Parachain - Next-generation blockchain
  23. 23. Trading order types: stop loss, trailing stop loss, LIMIT
  24. 24. Set up of Stop Loss and Take Profit orders
  25. 25. What are Decentralized Cryptocurrency DEX Exchanges?
  26. 26. What is Curve Finance?
  27. 27. What is GameFi and how does it work?
  28. 28. Non-fungible tokens and NFT exchanges
  29. 29. Cryptocurrency steps - What is move to earn M2E?
  30. 30. What is Proof of Reserves (PoR)? How does it work?
  31. 31. Interoperability in the world of cryptocurrencies and blockchain
  32. 32. Blockchain and its layers - What is layer three in Blockchain (L3)?
  33. 33. What is Layer 0 in Blockchain technology?
  34. 34. What is layer 1 in Blockchain?
  35. 35. What is MakerDAO and DAI Stablecoin?
  36. 36. What is Blockchain sharding?
  37. 37. What is the NFT licence fee?
  38. 38. What is the SubDAO protocol, and how does it work?
  39. 39. The main differences between static NFT and dynamic NFT
  40. 40. What is minting an NFT?
  41. 41. Mainnet versus Testnet on the Blockchain. The complete guide!
  42. 42. What are NFT Ordinals? A guide to Bitcoin NFT.
  43. 43. Market Cap versus Fully Diluted Market Cap - the most important differences you should know!
  44. 44. MINA Protocol: the lightest blockchain in the world!
  45. 45. NFT Gas Fee - what is it? How can you reduce your gas fee?
  46. 46. Liquidity Provider Tokens (LPs). What are they, and why are they so important?
  47. 47. What is KnowOrigin NFT, and how does it work?
  48. 48. What is decentralized social media?
  49. 49. What is the Ethereum Name Service (ENS) and how does it work?
  50. 50. Arbitrum: Ethereum scaling solution - everything you need to know
  51. 51. Ethereum ERC-4337 - what is it and how does this standard work?
  52. 52. Sustainable Blockchain - Proof of Useful Work & Flux
  53. 53. Ethereum Proof-of-Stake (PoS) - what should you know?
  54. 54. Atomic Swap: What is an atomic swap, and how does it work with cryptocurrencies?
  55. 55. What Is Cryptocurrency Vesting? What Are Its Advantages?
  56. 56. What Is the Metaplex Candy Machine Protocol? How Does It Work?
  57. 57. What Is the BNB Greenfield Ecosystem?
  58. 58. Real Yield in DeFi - what is this trend? What does it consist of?
  59. 59. What Is Slashing in Cryptocurrencies?
  60. 60. How to Create Your Own Decentralized Autonomous Organization (DAO)?
  61. 61. The ERC-721X VS ERC-721 Standard – Key Differences!
  62. 62. Royalties – What Are They? How Does This Type of Licensing Fee Work?
  63. 63. Polygon 2.0 - the value layer for the Internet
  64. 64. ERC-6551 - the new NFT standard. What does it bring to the non-exchangeable token sector?
  65. 65. What is TradFi? The importance for cryptocurrencies!
  66. 66. What is the Real World Asset (RWA) trend in cryptocurrencies? Explanation and examples!
  67. 67. Pyth Network: a powerful oracle harnessing the power of Solana!
  68. 68. Vampire Attacks in Decentralized Finance (DeFi): Explanation and Examples
  69. 69. What are stables in the world of cryptocurrencies?
  70. 70. What Is Binance Oracle?
  71. 71. What is NFT Lending all about? An innovative solution in the world of cryptocurrencies!
  72. 72. Shibarium: A new era in the Shiba Inu ecosystem?
  73. 73. What is an ETF? How will an exchange-traded fund on bitcoin work?
  74. 74. Symmetric and asymmetric encryption - key cryptography techniques!
  75. 75. Cosmos SDK: Building the Blockchain Ecosystem
  76. 76. DAO Investment: A revolution in the world of finance and investment
  77. 77. What is cross-chain interoperability in Blockchain technology?
  78. 78. Blockchain trilemma - explanation of the problem. What is the impact on cryptocurrency payments?
  79. 79. Hedging in cryptocurrencies - great portfolio protection against risk!
Lesson 64 of 79
In Progress

64. ERC-6551 – the new NFT standard. What does it bring to the non-exchangeable token sector?

Is the ERC-721 standard going away? A little yes and a little no. Newer and newer standards are appearing on the market, including ERC-721X or ERC-6551, which we will discuss today.

ERC-6551 is a new Ethereum standard for NFT. It introduces new facilities like making non-exchangeable tokens more dynamic or interactive. Will the new proposed standard take Web3 to a new level? What do you need to know about ERC-6551? We invite you to read on!

ERC-6551 – definition

Before discussing the new standard, it is important to recall the definition of ERC-721. This is also the standard for NFT tokens, designed to create NFT on the blockchain Ethereum. However, with the exception that ERC-721 cannot interact with intelligent contacts and dApps. Nor can they own other assets or evolve at all in line with growing market demands and requirements.

The utility and scope of ERC-721 is somewhat limited. So it’s no surprise that the industry has come up with a new standard for Ethereum that extends the capabilities of NFT ERC-721. ERC-6551, as it is referred to, unlocks new NFT use cases.

What does the ERC-6551 standard bring to the table? First and foremost, it improves the functionality of non-exchangeable tokens. In its operation, it builds on the Ethereum Improvement Proposal 6551 (EIP-6551) update, which was implemented on 7 May 2023 in the Ethereum mainnet.

ERC-6551 creates accounts associated with the tokens, simultaneously running a portfolio of intelligent contracts for each ERC-721. In practice, this allows them to perform transactions, interact with other applications, store NFT or serve as an identity in a chain.

How does the ERC-6551 standard work?

NFT ERC-721 have limited utility. They can only be transferred and owned. They cannot own other assets. Nor can they interact with other contracts or evolve based on external factors or industry requirements.

ERC-6551 circumvents this problem. It uses an unauthorised registry compatible with the already existing NFT ERC-721. What is the register in question? It is a intelligent contract that acts as a directory for TBA. Any user can generate such a directory for any ERC-721 by calling a function in the registry and paying a small fee. The registry then implements such a contract, and it in turn acts as the TBA for the token in question.

The authentication contract is the representative for TBA. It inherits all the properties and metadata of the original non-exchangeable token ERC-721. Furthermore, it implements the EIP-1271 standard, thus enabling message signing and signature verification, on behalf of this token. This allows TBA to interact with other, intelligent contacts across the Ethereum ecosystem (decentralised DEX exchanges, lending platforms, gaming environments and others).

TBA (Token-based Authentication). Token-based authentication. In other words, a protocol designed to generate encrypted security tokens. TBA allow users to verify their identity. Such a token allows users to access protected information and resources for a limited period of time, without having to re-enter their password or username.

How does the ERC-6551 perform on the NFT?

In short, it streamlines them. With the new standard, we can combine all our NFT and other assets into one. One profile means convenience, a seamless user experience when transferring or selling their assets.

Additionally, with ERC-6551 we can create multiple on-chain identities. And this is all via NFT. We can use the identity generated in this way to interact with other smart contracts and dApps. We do not then have to rely on the wallet itself. This opens up new possibilities for use – rewards, credit ratings or even loyalty programmes.

Another feature of ERC-6551 will be interoperability. Tokens in this standard will be able to be used on different platforms, to serve as an identity and a means of transaction.

ERC-721 tokens have no utility history. This is their huge disadvantage. The account registry present in the ERC-6551 standard solves this problem. They allow the tracking of ownership, transaction or utility history of NFT.

Despite these many advantages, there are also many challenges facing this new standard. As a novelty in the world of cryptocurrencies, it makes it difficult for already existing platforms to implement this new standard.

Also, importantly – some platforms may not even be compatible with this standard! The technology for integration of ERC-6551 is demanding, which at the same time is a barrier to adoption.

Another disadvantage of ERC-6551 is counterintuitively their usability. As they can store other assets or interact with dApps, they are vulnerable to phishing and all kinds of fraud. When it comes to the issue of security, we still have a lot of room for improvement here.

And lastly, perhaps the biggest downside of the ERC-6551 standard is that they can overload the mainnet Ethereum.

Summary

Without doubt, ERC-6551 is a groundbreaking technology. It has many advantages and disadvantages. It opens up the possibilities of ERC-721 NFT, on various platforms as we know them.

At the same time, it brings new challenges – including security issues that need to be worked on with the introduction of this new token standard.

Complete today’s lesson!

  1. What is Ethereum? [BASIC LEVEL]
  2. Smart Contracts – what are they? [BASIC LEVEL]
  3. What is an NFT token? [BASIC LEVEL]
  4. Ethereum ERC -4337 – What is this standard and how does it work? [INTERMEDIATE LEVEL]