ERC-404: A New Token Standard Combining NFTs and Cryptocurrencies
An innovative token standard called ERC-404 has gained significant traction in the Ethereum ecosystem, boasting a market cap of $170 million and generating $87 million in trades. Unlike existing token standards like ERC-721 (non-fungible) and ERC-20 (fungible), ERC-404 merges the features of NFTs and fungible tokens. The first token to utilize this standard, Pandora, has seen a remarkable surge, trading at $16,600—an exponential increase of 5000% since its launch in early February.
A Unique Approach to Liquidity and Fractionalization
According to Pandora’s GitHub, ERC-404 brings native liquidity and in-standard fractionalization. This implementation has attracted significant interest from traders, resulting in substantial trading volume on decentralized exchanges and NFT marketplaces. Although the token standard has yet to undergo a full external audit, it presents a promising solution for improving liquidity and access to funds for NFTs, which have traditionally suffered from illiquidity.
Trading Volume Spikes and Consequences
The ERC-404 token standard has influenced trading volume on decentralized exchanges, particularly due to users attempting to acquire rare Replicant tokens. When a full token is sold, the linked NFT is destroyed, leading to increased trading activity. This has been advantageous for liquidity providers within the Uniswap pool associated with the token, collecting nearly $1 million in fees since early February.
PANDORA Tokens Experience Unprecedented Surge
The PANDORA token, the first to utilize the ERC-404 token standard, has reached astonishing levels, currently trading at $21,344—a surge of over 126% in the past 24 hours. Traders have profited immensely from this surge, with one trader making $1.2 million in just two days. Lookonchain tweeted about this remarkable profit, highlighting the trader’s success with the PANDORA token.
“The price of #Pandora, the first token built on the #ERC404 token standard, has now risen to over $8,600. A trader has made a total profit of ~$1.2M on #Pandora in just 2 days! The trader spent 97,484 $USDT to buy 154 #Pandora at $633 2 days ago and sold 25 #Pandora for 188,695 $USDT at $7,548 1 hour ago, realizing a profit of 91,211 $USDT. The trader currently holds 129 #Pandora ($1.1M), and the unrealized profit is $1.1M.”
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