Web3Decision Guide
ERC-20 vs ERC-721
ERC-20 is for fungible tokens (currencies, points). ERC-721 is for non-fungible tokens (unique items, collectibles).
Quick Verdict
Choose ERC-20 if...
- You're creating a currency or utility token
- All tokens should be interchangeable
- You need divisible tokens
- You're building loyalty points or governance tokens
- High transaction volume is expected
Choose ERC-721 if...
- Each token represents a unique asset
- You're creating digital art or collectibles
- Items have individual properties/metadata
- You need provable ownership of unique items
- You're tokenizing real-world assets
Side-by-Side Comparison
Feature
ERC-20
ERC-721
Fungibility
Fungible (interchangeable)
Non-fungible (unique)
Divisibility
Yes (decimals)
No (whole tokens only)
Token ID
No (balance-based)
Yes (each token has ID)
Metadata
Contract-level only
Per-token metadata
Transfer Cost
Lower gas
Higher gas
Use Cases
Currencies, governance
Art, collectibles, assets
Enumeration
Not needed
Optional extension
Approvals
Amount-based
Per-token or operator
Complexity
Simpler
More complex
Marketplace Support
DEXes
NFT marketplaces
Decision Checklist
Ask yourself these questions to guide your decision:
1Should tokens be interchangeable?
2Does each token need unique properties?
3Do you need fractional/divisible tokens?
4Will tokens represent unique real-world items?
5What marketplaces need to support your tokens?
6How important is gas efficiency?
7Do you need per-token metadata?
8What is the expected transaction volume?
Tradeoffs & Gotchas
ERC-20 cannot represent unique items
ERC-721 costs more gas per transfer
ERC-20 is simpler to implement
ERC-721 requires metadata management
ERC-20 has better DeFi integration
ERC-721 has better marketplace integration
ERC-20 scales better for high volume
ERC-721 enables richer ownership experiences
Our Recommendation
Pick ERC-20 for currencies and utility tokens
Pick ERC-721 for unique digital collectibles
Pick ERC-20 for governance tokens
Pick ERC-721 for gaming items with unique stats
Pick ERC-20 for reward points systems
Pick ERC-721 for certificates or credentials
Frequently Asked Questions
Can I convert between ERC-20 and ERC-721?
Not directly. They serve different purposes. You could create wrapping mechanisms, but it's usually not practical.
Which is better for gaming?
Often both. ERC-20 for in-game currency, ERC-721 for unique items. Consider ERC-1155 for games with both.
Can ERC-721 tokens have different values?
Yes. While each token is unique, marketplaces determine value based on metadata, rarity, and demand.
Which is cheaper to deploy?
ERC-20 contracts are typically simpler and cheaper to deploy. ERC-721 adds complexity for metadata and enumeration.
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