ERC-721

ERC-721 is another Ethereum token standard, but this one is designed for tokens where each unit is unique and cannot be swapped one-for-one with another. The “721” again refers to the proposal number. While ERC-20 handles identical, interchangeable tokens, ERC-721 handles tokens where every single item has its own identity and potentially its own distinct value. This is the foundation that makes NFTs (Non-Fungible Tokens) possible on Ethereum.

Under the ERC-721 standard, every token has a unique identifier number stored on the blockchain. Two ERC-721 tokens from the same collection might look similar, but they are recorded as separate, distinct items. Ownership of each token is tracked individually, so the blockchain can tell you exactly who owns token number 47 versus token number 48, and those two tokens might have completely different prices on a marketplace.

The standard also includes rules for transferring ownership, approving other addresses to move your tokens, and checking who owns a specific token — all in a way that wallets and marketplaces can universally understand.

Example: Think of ERC-721 tokens like house deeds. Even if two houses are on the same street and look similar, each one has its own legal deed, its own address, and its own unique history. You cannot swap one house deed for another as if they were the same thing — each one refers to a distinct, one-of-a-kind piece of property. ERC-721 tokens work exactly like that.