If you’ve done a fair amount of NFT research, you’ve likely come across the term “token standards.” Token standards can be a confusing topic, but gaining a baseline understanding of them is easier than you may think. Learning more about token standards is an excellent way to familiarize yourself with NFTs.

What is a token standard?

There are countless cryptocurrency tokens available, with new ones popping up everyday. Many of these tokens use existing blockchains, such as the Ethereum blockchain. Token standards help ensure these newly-minted tokens are compatible with existing exchanges. These standards enable people to create, issue, and deploy new tokens based on a specific blockchain. Token standards are primarily used on blockchains that utilize smart contracts, as they’re a subset of smart contract standards.

What is a smart contract standard?

Smart contract standards are the specific rules that a smart contract must comply with to utilize a specific blockchain. Smart contract standards include token standards, name registries, and more. These smart contract standards enable smart contracts to communicate efficiently between various dApps.

Ethereum token standards

• ERC-20: This standard allows for the creation of fungible tokens. It is the most popular token standard on Ethereum. Popular tokens like Shiba Inu, Tether, and ApeCoin were all created using the ERC-20 standard.
• ERC-721: This standard allows for the creation of non-fungible tokens. It is the standard used for many of the most popular NFTs.
• ERC-777: This is a fungible-token standard that improves upon the ERC-20 standard. This standard allows for sending tokens to a contract and notifying the contract in a single transaction, rather than requiring two calls like ERC-20. The ERC-777 standard also allows for enhanced privacy and fixes certain issues with decimals that exist with ERC-20 tokens.
• ERC-1155: This standard helps save costs by allowing transaction bundling. This standard can be used for fungible tokens like Basic Attention Token and non-fungible tokens such as CryptoPunks. 

Non-Ethereum token standards

Solana

Solana uses the SPL token standard for both fungible and non-fungible tokens. SPL tokens use the Solana Program Library and can be stored in most Solana-compatible wallets. The SPL token standard is essentially Solana’s version of ERC-20 tokens.

Binance

Binance’s two primary token standards are BEP2 and BEP20. The BEP2 standard is used for the Binance cryptocurrency exchange. BEP20 tokens are meant to interact with dApps on the Binance blockchain. Binance Smart Chain (BSC) tokens use the BEP20 standard.