A group of crypto developers has unveiled an alternative solution to the experimental ERC-404 token standard, aiming for the same functionality but with reduced impact on Ethereum transaction fees.
Launched in early February by Pandora, ERC-404 aimed to combine ERC-20 tokens and ERC-721 NFTs, enabling users to split and merge NFTs (fractionalization) with relative ease. While innovative, the approach caused a surge in Ethereum transaction fees, prompting concerns about its real-world usability.
The alternative DN-404, recently released on February 12, aims to improve on this. Launched by developers "cygaar" and "quit," it promises a 20% reduction in transaction fee impact. Their key difference lies in the contract structure. While ERC-404 attempts to merge NFT and token functionality into a single contract, DN-404 utilizes two separate contracts: a standard ERC-20 token and a mirrored ERC-721 NFT. This split approach, the developers argue, mitigates potential security risks and adheres to established standards, ultimately streamlining the process.
However, there are caveats. The DN-404 code remains unaudited, meaning there are inherent risks involved. Additionally, unlike ERC-404, the developers haven't yet deployed their version in an actual token-NFT hybrid project.
While "quit" acknowledges the experimental nature of their creation, they see it as a response to the community's interest in utilizing the core ERC-404 concept. Their goal is to offer a more efficient and secure implementation for those exploring this innovative token-NFT combination.
Source : Yahoo Finance / Feb 14, 2024