Usually, you hear about the terms “EIP” and “ERC” and most of you get confused after hearing these terms. EIP and ERC both are used in the Ethereum blockchain network for various purposes. EIP is a proposal for the improvement of the Ethereum network. On the other hand, the Ethereum blockchain network uses the ERC standard to create tokens. To know more about these two terms let’s deep dive into the EIP and ERC!
What Are EIP and ERC and How Are They Connected?
EIP and ERC, both are technical standards that are used in the Ethereum blockchain ecosystem, ERC is for Ethereum Request for Comments, whereas EIP stands for Ethereum Improvement Proposal.
EIPs are a kind of proposal that is submitted by the developers or community and is subject to make the improvements in the network. EIPs proposals can be submitted to anyone including developers, community members, researchers, and others who experienced the network. It contains suggestions and improvements, even minor bug fixes to advanced upgrades in the entire network. Overall, the purpose of EIPs is to improve the network according to the opinion of the experienced community of the Ethereum blockchain network. It is similar to the BIPs (Bitcoin Improvement Proposal). EIPs are open and transparent, which means each member of the Ethereum blockchain community can participate in it and can debate any suggestion. Everyone is free to give their personal opinions or suggestions after experiencing the network.
ERC is a set of rules and standards by following them the developer can create a token on the Ethereum blockchain network. With the help of ERC, developers can evaluate their created token whether it is compatible with all other Ethereum-based applications or not. Simply, if the new token is created using the Ethereum blockchain then it is a must that it meets the predefined condition by the Ethereum blockchain and it can also be easily used with each Ethereum-based application. It's a complete standard to develop a new token by using the Ethereum blockchain. The most well-known standard is ERC-20, by using this specific standard you can create ERC-20 tokens on the Ethereum blockchain network. Here most commonly used ERC standards are given below:
- ERC-20_ Fungible Tokens
- ERC-721_ Non-fungible Tokens
- ERC-1967_ Upgrade Smart Contract
- ERC-3000_ Standards for decentralized domain name systems (DNS)
- ERC-721x _ Standard for managing large-scale NFT
- ERC-998 _ Standard for composable tokens
- ERC-1400 _ Standards for Security Tokens
- ERC-777_ Standards for advanced tokens with additional features
- ERC-165_ Standards for Contract Metadata
Overall, EIP is the proposal for the improvements in the Ethereum blockchain ecosystem while ERC is the standard for the creation of new tokens on the Ethereum blockchain network. Both are technical standards one for (EIP) to implement the advancements in the network and the other one (ERC) for to develop the new digital asset in the network. Both are important technical terms for the Ethereum blockchain network.