In this article, we learn about ERC 621, 884, 1411, 1400, 777, and 1404
ERC 884
The Ethereum blockchain’s ERC-884 token standard is specifically made for managing securities, especially ones that adhere to Delaware corporate law. Using blockchain technology, it enables businesses to handle shareholder records and tokenize their shares. The standard incorporates features like whitelisting and KYC compliance to meet regulatory standards, and each ERC-884 coin represents a distinct share.
Purpose
Companies can now issue shares as digital tokens on the Ethereum blockchain to ERC-884, which attempts to streamline the digitisation of equity ownership.
Compliance:
It is made to satisfy the requirements of US securities legislation, especially Delaware’s, where businesses can now register shares using blockchain technology.
Key Features:
Whitelisting: Token owners must be validated and added to the whitelist in order to adhere to KYC/AML rules.
Comparable to a shareholder registry, the standard keeps track of token holders for legal compliance and transparency.
Off-chain Data: Issuers must keep an off-chain database up to date in order to store data pertaining to KYC regulations.
One-to-one correspondence:
There is a clear mapping between digital tokens and equity ownership because each ERC-884 token represents one share of a corporation.
Benefits:
By offering a more effective and visible approach for controlling share ownership, ERC-884 may make fractionalised, liquid, and transparent equity trading possible.
Limitations:
Legal complications and the popularity of more adaptable token standards like ERC-1400 have made ERC-884 adoption rare.
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ERC1411 and ERC1400
ERC-1400 and ERC-1411 are ERC security token specifications. Security token sales regulatory compliance is the focus of ERC-1411. A more focused implementation or expansion of ERC-1400 is ERC-1411.
Key Differences:
Scope:
ERC-1411 concentrates on compliance-related issues, whereas ERC-1400 is a more general standard that addresses the overall characteristics and capabilities of security tokens.
Implementation:
ERC-1411 adds jurisdiction filtering, error messaging, and whitelisting for compliance and regulation to ERC-1400.
Purpose:
ERC-1411 ensures security tokens comply with legislation, while ERC-1400 provides a framework for creating, managing, and transferring them.
In simpler terms:
ERC-1411 is a specialised model that adds equipment like airbags and safety systems for particular countries, while ERC-1400 is a blueprint for manufacturing an automobile. The fundamental framework is provided by ERC-1400, while compliance features are added by ERC-1411 to guarantee that the vehicle satisfies legal requirements for safe driving.
ERC 777
A proposed standard for the upcoming generation of fungible tokens, the ERC-777 standard is intended to be an enhancement to the ERC-20 standard. Its primary goal is to rectify some of the shortcomings seen in ERC-20 and ERC-223.
This is a thorough description of the ERC-777 standard:
Relationship to ERC-20: ERC-777 is a backward-compatible upgraded ERC-20. ERC-20 tokens are fungible, like currency. A number of sophisticated functionalities for working with ERC-20 tokens are also defined by ERC-777.
Improvements in Token Transfer: ERC-777’s token transfer mechanism is one of its most notable enhancements. A “push transaction” is usually used by ERC-20, in which the sender starts the transfer directly. This procedure is improved in a number of ways by ERC-777:
Token holders can grant smart contracts (called operators) permission to move tokens on their behalf and revoke that authorization using the operators (authorizeOperator and revokeOperator functions). An operator in ERC-777 only needs to be authorised once to carry out numerous subsequent transfers, in contrast to ERC-20’s “pull transaction” method, where authorisation is frequently required for each transfer.
Hooks (functions tokensToSend and tokensReceived):
The tokens Received method in the receiving contract can be used to specify which ERC-777 tokens it is prepared to accept or reject (via a revert mechanism). Rejecting a token will prevent the transfer from being finished. This stops tokens a prevalent issue with ERC-20 from being inadvertently delivered to contracts that are unable to handle them.
In a similar vein, a tokens-to-send hook can be provided to a contract that requests a token transfer, allowing it to reverse the transaction.
Data Field in send function: The ERC-777 send function has a data field. The sender can now include specialised logic that can initiate a function in the receiving contract in addition to sending tokens to the contract. This feature is comparable to the way Ethereum transactions are carried out.
Enhanced Control for Token Holders: The addition of “hooks” gives token holders greater authority over their tokens. This feature allows recipients to call an ERC721Received method to see if they can manage received tokens. The transfer is terminated if this method is not used by the receiver.
Status of Adoption: Although the ERC-777 standard is better than ERC-20, the industry has not yet embraced it extensively. The main cause of this is the high switching costs for all parties involved. The new standard would require token holders to exchange their current tokens for the new one, and projects would have to develop new token contracts. Exchanges and decentralized apps (dapps) would also need to adjust their systems in order to include ERC-777.
To ensure that applications dealing with Ethereum smart contracts know which functions and inputs to call, the Ethereum community has worked to formalise and enhance token specifications through ERC-777. It is one of the Ethereum ERCs (Request for Comments).
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ERC 1404
One Ethereum Request for Comments (ERC) standard that permits the production of tokens with regulatory transfer restrictions is ERC-1404.
Important features of ERC-1404 consist of:
The goal of these limitations is to give users various options for managing token transfers. An issuer may decide to check for time constraints on the senders’ tokens or grant tokens only to a recipient who has been whitelisted.
Relationship to ERC-20: ERC-1404 adds two additional features to the current ERC-20 standard in order to include control and restriction mechanisms.
Defined Functions: ERC-1404 added two functions, which are:
Public view returns (uint8) from the function detectTransferRestriction (address from, address to, uint256 value);
Function messageForTransferRestriction returns (string) in the public view (uint8 restrictionCode);
ERC 621
The ERC-621 token adds functionalities to the ERC-20 Ethereum blockchain standard. This means ERC-20 is expanding.
A detailed description of ERC-621 tokens is here:
Foundation on ERC-20: ERC-621 coins use the popular ERC-20 standard.
In contrast to the fundamental ERC-20 standard, they offer more functionality and flexibility.
Notable Functionality: The ability to change the quantity of ERC-621 tokens is vital. This provides greater flexibility for a range of application situations.
ERC-621 is a Versatile solution that may be used to create a variety of tokenised assets. ERC-621 can be a flexible approach for building utility tokens, security tokens, or any other tokenised asset.
ERC-621 tokens use Ethereum smart contracts.
ERC-621 token developers must know Solidity, the Ethereum smart contract programming language.
Demand: ERC-621 tokens and other Ethereum-customized tokens are in high demand as blockchain technology and cryptocurrencies evolve.
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