Fungible Token Standards

ERCs vs EIPs vs RSKIPs

Ethereum Requests for Comment (ERCs), and Ethereum Improvement Proposals (EIPs) refer to the same thing - they were originally called ERCs, and then subsequently renamed to EIPs. These are all focused on improvements to Ethereum.

RSK Improvement Proposals (RSKIPs) use a similar process to improve RSK.

A small subset of EIPs, albeit an extremely popular subset, are tokens standards, which have to do with smart contracts, and do not have much to do with the Ethereum nodes. Instead, they focus on the Solidity smart contract implementations with the intent to standardise the ways in which tokens get implemented.

Ethereum Token Standards work on RSK

Since the RSK Virtual Machine (RSKVM) is compatible with the Ethereum Virtual Machine (EVM) at the op-code level, smart contracts that are compiled to target the EVM can be executed in exactly the same way on the RSKVM.

Note: Some differences exist, most notably to do with how gas costs are calculated, both in terms of the schedule per op-code, as well as the calculation methodology. At the time of writing, like-for-like smart contract function invocations cost 2% to 2.5% on RSK compared to Ethereum.

Owing to this level of compatibility, the same smart contracts standards that work on Ethereum also work on RSK - there is no need to create "mirror RSKIPs" that are the equivalent of EIPs for token standards, since they will be virtually identical.

Fungible Tokens

address -> amount

At their core, fungible tokens are smart contracts which store a mapping of addresses to amounts. This is used to represent an understanding that each particular address is the owner of a particular amount of tokens.

transfer(...)

These smart contracts will also have a transfer function, that allows them to transfer the tokens held in one address to another address.

Of course, there is a lot more to fungible tokens than the above, the above is merely a rudimentary illustration.

ERC20

The ERC20, or EIP20, token standard is the most well-known among all fungible tokens standards. In fact, it was so popular, that at some point 3 in 4 smart contracts on the Ethereum blockchain implemented this standard. To this day, it remains a dominant force, and in fact the term "ERC20" is almost synonymous with the term "fungible token".

The above is also true on the RSK network, virtually all fungible tokens implement this particular token standard.

Its continued relevance stems from the fact that whenever a new fungible token standard comes out, the most critical factor to enable adoption is to be "ERC20 compatible". This means that new fungible tokens standards implement the interface specified by the ERC20 token standard, and then add their own additional functions on top of it.

ERC677

The ERC677 token standard is also a fungible token standard, and it extends the ERC20 token standard.

transferAndCall(...)

The key addition is the transferAndCall function, which allows the user to combine a transfer function invocation on the fungible token smart contract with another function invocation of their choice on a different smart contract. This allows the user to accomplish both operations in a single transaction submitted to the blockchain network.

On the RSK network, the LINK token from Chainlink, and the RIF token from RSK, both implement this standard.

More standards

There are many other smart contract standards used to build fungible tokens, including ERC223, ERC777, and ERC1363. These all happen to be backwards compatible with ERC20 standard, however have not seen much by way of widespread adoption yet.