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MAR 15, 2024

But You're A Part Of This World? Aren't You?

by 2Eyr..75fG, Cat Russell

Contracts, Proposals and Standards (On ETH and its L2s)
Cat Russell Essays are a series of musings and educational pieces to help artists in the space of web3.  They often will be written for a beginner-intermediate web3 artist so that they can understand nuanced aspects of the space.  Most importantly though, I try to write them in a manner where I am not telling you what to do, but giving you the correct information and questions to ask so that you can make informed decisions and uniquely shape your creative presence in the space and move with intention.
So maybe you have just joined the NFT space.  Or maybe you have been around for a couple years but just always minted where everyone else did.  Maybe you saw minting 'metas' ("oh open editions on Manifold") and jumped on them because why swim against the current?  Regardless of which, if you feel disconnected with understanding the Where, How, or Why on what you mint then this essay is for you.  
Pippin would think it important not to ignore the foundations of how the web3 space works I think
Pippin would think it important not to ignore the foundations of how the web3 space works I think
First, lets knock out some definitions:
What is a Smart Contract
I am stealing the answer from IBM's website: "Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met". I think that is a pretty good definition. Basically, on the Ethereum network we can store a program that will execute computations, inform output, or carry out other tasks. Currently there are a handful of contract standards that artists may choose to mint art on, such as ERC 721 and ERC 1155 just to name two.
What is an ERC
The 'Ethereum Request for Comment' is what happens when we see an Ethereum Improvement Proposal (EIP) reach a group consensus.  But it is important to note that they exist on an application level, so not everyone has to adopt them.  

Okay lets break that down real quick and make it more understandable.  Ethereum will have developers propose improvements to the network (EIPs).  If a large group of devs say 'oh this is a good idea', they work it up and battle test it and it becomes an ERC standard.  At this point, applications can choose to integrate it.  Let's use that new Transient Labs contract as an example: ERC7160 was proposed (EIP)-->then standardized (ERC)--> and now other marketplaces have the option to allow minting, trading, ect of NFTs created with it.

For most artists in the space, ERC standards will be where you want to stay versus diving into EIPs.  Even then, utilizing the latest and coolest ERC may not be a good fit for all artists.  There is value in knowing that something has passed through both a quality control test form the community and giving it time to let it be battle-tested to ensure no exploits exist.
ERC Standards of Note
1. ERC 20- The classic 'Fungible' token
Many of the alt coins you see degens in the space telling you will 'moon' exist as ERC20 contracts, the standard contract for tracking values of a specific fungible token among wallets on the network. "Fungible? What does that mean Cat?". Here let me break it down with a hypothetical: Let's say you have a dollar bill in your pocket. I sneak over and steal that dollar bill and replace it with a different one. You later pull this different dollar out of your pocket. Has anything really changed? In short, no. each dollar is a dollar regardless of 'which' dollar you have. They Are Fungible.

It is important to note they are VERY fungible.  you can own 1/millionth of an ERC 20.  Because of this (and a bunch of other reasons) we dont see art be on an ERC20.
2. ERC 721- The Classic 'Non-Fungible' token
In 2018 we saw the passage of ERC721. This standard is quite similar to an ERC20, except it tracks value for a specific non-fungible token. "Non Fungible? Cat...English please."  Ummm similar hypothetical: you have a hand written letter from your mom in your pocket.  I sneak over and steal that letter and replace it with a letter she wrote me ( ͡° ͜ʖ ͡°).  Later you pull this different letter out of your pocket.  Has anything changed?  Absolutely.  Because these letters are Non-Fungible.
For artists, the ERC 721 contract is what you would deploy and mint on to put out 1of1 art.
3. ERC 1155- The 'Semi-Fungible' token
Art Editions.  Each token is a whole and not natively able to be broken down into millionths of parts, but they are still 'fungible' at their core and can be interchanged between their editions.
4. ERC 6551- The 'folder' token
'The folder token' isn't the real name.  Just an easy descriptor to help your brain remember.  A 6551 can turn any 721 token into its own wallet.  That wallet can store any tokens and manage them.  Why?  Lots of reasons.  I think the easiest example is one form the gaming industry: The account character and inventory.  In this example, your video game character is a 6551 and all his gear, spells ect are nested in the character.  You decide 'I hate this game' and want to sell your account and you are able to sell it all with just the sale of the character and everything can transfer along with him.
For artists I believe it has a lot of fun applications.  I built a collab series where artists nested art into the nfts I made and we sold them as bundles.  You could also use it to nest work in progress nfts or backstory nfts.  Lots of uses, idk use your imagination with it, you are the artist after all.
5. ERC 404- The 'Even more hybrid' token

Shocker 'the even more hybrid token' isn't what people call it.  Again, we are trying to put this stuff in easier terms.  Basically this standard allows fractionalization of art and can turn art into that fully fungible erc20 style shitcoin.  I honestly cannot speak too much more on it as I don't see them as a fit for my path in this space.
6. ERC 7160- The Transient Standard. AKA Multi-metadata 721s
Transient has really spearheaded this.  Essentially you got a 721 and you want more from it.  Maybe you want more images (doppleganger contracts by them), or you want more depth to the metadata.  This is the standard for that stuff.  
But now back to you, the artist
"But Cat, why did I need to know all this if you are just going to tell me to understand 4 ERC standards and use these politely packaged items?"  Two reasons: The first is that if you are trying to be your own guiding light you shouldnt wander in the dark.  A perfect example is the following:
In 2021, some artists begin stressing the benefits of custom contracts versus shared contracts.  It initially didn't catch on.  Then Manifold released a public product and suddenly everyone swore it was absolutely essential for the provenance.  Pieces that were lazy minted on Opensea suddenly begin to receive criticism for doing so.  Fast forward to now.  Recently a couple marketplaces have being to release 'new' products that all artists to release art on ETH without an initial gas fee.  I have seen very little negative criticism, despite this being lazy minting with a fresh coat of paint. "Wait so lazy minting is bad?"  You are missing the point.  I am not arguing the validity of the lazy minting mechanism here, only pointing out something I find myself quoting more and more these days- "you arent immune to propaganda."   While we may not be immune, I assure you a little bit of knowledge goes a long way to ensuring wherever your opinion lands on something you arent accidentally contradicting yourself.
Now, the second reason: Moving without compromise.  Let's say you have a great idea for a novel way to collect art.  Then you may want to act on it.  Understanding the different standards that exist and where proposals for new standards live is a great way to research the feasibility of your exciting idea.  You may find a fledging proposal or standard that can accommodate your needs.  And even better, you may find the best people to work with right then and there to make it happen.  After all, I always am excited to find people building things I am actively searching for. 
Thanks for reading, hope this helped. It was written March 2024, so keep that in mind as it may be inaccurate in parts a year from now.  GIF is from Lord of the Rings and isnt my art.  Want to see my art (of course you do), go to catrussellart.com
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