The development of the Ethereum blockchain has transformed what was obtainable with the genesis blockchain of the Bitcoin network. The use of Ethereum for DeFi and NFTs has gained mainstream attention and further development of products that have seemed to defy the main purposes that users have thought it was meant to do. It is indeed pertinent to learn about the Ethereum blockchain.
What is the Ethereum Blockchain?
Ethereum is one of the most popular blockchain networks today, and it is much more than just a cryptocurrency. It is an open-source public service that leverages blockchain technology to offer smart contracts and secure cryptocurrency trading without any intermediaries.
The desire to make Ethereum technology easily understood has grown profoundly in recent times thanks to the capabilities of the Ethereum foundation to facilitate decentralized application development.
There are many aspects about Ethereum which make it indeed more than a crypto token and give it the required utility and value. This includes but is not limited to Ethereum transactions in Decentralized Finances (DeFi), Smart Contracts, Non-fungible tokens (NFT), token deployment, Ethereum consensus, and the development of decentralized applications (dApps) with a specific focus on distributed autonomous organizations (DAOs).
There are unique features developed by the Ethereum foundation which enable tokens to be created as non-fungible tokens (NFTs) such that each of the tokens is distinctively unique amongst each other and is properly stored in a distributed ledger within the Ethereum network.
What are NFT’s?
In simple terms, NFT is a type of token that is not interchangeable and is distinguishable from one another. In other words, it is distinctively unique. This characteristic makes it differentiated and quite desirable.
For example, if you have a music album, you can create a Non-Fungible Token to tokenize the songs. The NFT you now own reflects that the ownership of the song belongs to you. It is non-interchangeable as your song is unique. The NFT is stored on the blockchain as your property in a minted form.
In the past few months, NFTs have been heavily used for the purpose of creating a new financial opportunity in the blockchain and crypto space. This is such that many people have been creating digital art or different digital stuff including videos, artwork, songs, picture images, drawings, and even tweets which were sold for huge sums, and they were tokenizing it using NFTs to create value.
New protocols to support NFT’s
Due to the flexibility and scalability of the Ethereum network, which has given it the ability to deploy new projects upon a tier two-layer of the network, projects can be built on the ERC-20 for fungible tokens which consists of about 70 to 80 percent of all tokens created in the entire crypto ecosystem.
Subsequently, there is also the creation of ERC-721, which simply provides us with a standard to create and exchange Non Fungible Tokens. Each ERC-721 token is unique, which is not the case with ERC-20 tokens.
To make it even more clear: the key difference between ERC-721 and ERC-20 tokens is that ERC-20 tokens are divisible (fungible), just like you can divide $20 into two $10 bills. However, ERC-721 tokens are non-divisible hence the term Non-Fungible Tokens.
However, even though ERC-721 was an instant success, used to create probably millions of NFTs, it also had some limitations which led to high transaction fees. The Ethereum foundation then created the ERC-1155, which was developed in response to the limitations of ERC-721 and ERC-20, which makes it a better alternative.
Such that you can store the bulk of the code in a central contract for each token variation, which is given an identification number. It also allows you to perform more than one complex task in a single transaction. This will reduce congestion on the Ethereum blockchain.
In conclusion, all these features have dynamically improved the Ethereum network and made it an important blockchain network with a great utility that would be a topic of discussion for a very long time. The Klever marketplace is also a unique platform for trading various NFT’s, with our ability to integrate such incredible tokens onto our platform. The best is yet to come on the Klever marketplace.
