Witek Radomski, the co-founder and Chief Technical Officer [CTO] of Enjin.com, has created a new standard known as ERC-1155 for tokens on the Ethereum [ETH] blockchain. The standard in question is for defining tokens for video game items on the blockchain.
Notably, Enjin is a service that allows users to build video games on the blockchain, with support for fungible and non-fungible tokens to represent game items. The coin, with the name ENJ, is ranked 163 on CoinMarketCap, with a value of $0.05.
The ERC-1155 token standard allows for the creation of tokens, with a slight twist. The items are stored in one contract, as opposed to previous standards, where each token had to define a new contract for itself. The contract contains the minimum possible amount of data required for distinguishing the contained token from others.
The new token standard also allows for easier atomic swaps between tokens. As illustrated by Radomski in his Medium post, a swap between two tokens established on previous standards would require 4 steps. This is due to the additional approval step required for each token being swapped.
The ERC-1155 tokens can be swapped in just 2 steps, as there is only one approval step as opposed to multiple steps for each. It can also allow users to send any number of items to one or many recipients on the blockchain in one transaction, saving gas costs and congestion.
Moreover, the standard allows for the creation of fungible and non-fungible items. Fungibility is the property of a commodity wherein individual units of the said commodity are interchangeable. Video games feature both of these kinds of assets, with ammunition, health kits, and other such assets being fungible, and armor, weapons, and other items being non-fungible. As said by Radomski:
“When you need to attach unique history, provenance, and identity to every copy of a certain weapon, these would be designed as non-fungible items. ERC-20 is limited to fungibles, and ERC-721 is limited to contracts with individual unique copies of items. The two token types are not very compatible or mixable.”
The ERC-1155 contract can also allow anyone to create their own tokens through the Enjin program, which features a GUI to create and launch tokens. The token standard has been released to the game development and Ethereum community to encourage adoption and support. Radomski ended the post by saying:
“ERC-1155 brings a new level of efficiency and potential to any application that needs to work with tens, hundreds or thousands of tokens, and removes barriers imposed by existing token designs.”
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Coin Metrics data reveals inaccuracies in Kik’s claim of being as dominant as BTC, ETH blockchains
Upon investigating Kik’s claims in response to SEC’s lawsuit filed earlier this month, CoinMetric data reported inconsistencies in the on-chain activity and adoption rate of its native token, Kin.
In a study dubbed, “An Analysis of Kin’s On-Chain Activity,” the crypto-asset elaborated on the two assertions made by Kik in its letter to the US Securities and Exchange Commission.
Kik’s first claim was regarding its blockchain activity. Its in-house token, Kin, supposedly exceeded Ether and Bitcoin to record the fifth highest daily blockchain activity. This was debunked by CoinMetric’s investigation after taking into account its “Operation Count” [the same metric used by Kik to support their claim] and “Transfer Value.”
In terms of the Operation Count, the report explained,
“According to Kik’s source for the metric, “blockchain activity” is defined as “the number of operations on the blockchain in the last 24 hours.” Operations are broadly defined as any type of action that could be recorded on chain. But operations are not standardized across blockchains which makes comparing across chains difficult.”
Besides, drawing parallel comparisons across blockchains with radically different use cases and operations is difficult.
Although Kik’s original research showed a high number of account creations, Coin Metrics data revealed that many of these accounts were empty.
Additionally, Kin’s “create account” operation has a fee of .001 Kin. The report highlighted that a metric such as “operations count” for the purpose of blockchain activity cannot be used as a measurement tool since Bitcoin and Ethereum blockchains do not track account creations on-chain.
In terms of Transfer of Value, the report elaborated,
“Theoretically, high daily transfer value should signify high activity. But transfer value is often quite noisy, especially on low fee blockchains where there are minimal costs to sending transactions. Some transfers might simply be users moving money around between addresses they own”
Instead, Coin Metrics contrived “adjusted transfer value” metric to eliminate what it called, “noise and certain artifacts like self-sends, or deliberate spammy behavior.” Coin Metric noted that this gives a clearer picture of the on-chain activity, resulting in a decreased transfer value when compared to other blockchains, even if it had a high number of daily blockchain operations.
Additionally, Kin’s average transaction value was also low, when compared to other blockchains. For the first claim, Coin Metrics concluded that the Kin platform had more micro-transactions than Bitcoin and other dominant blockchains, while highlighting the fact that the latter blockchains are not primarily used for such transactions.
Regarding Kik’s second claim that said that over 300,000 users were earning and spending Kin as a currency, Coin Metrics assessed its blockchain usage. The number of addresses is not necessarily equal to the number of users since a single user could have multiple addresses. Hence, Coin Metrics took the number of active users into account, which the report defined as “the number of unique addresses that were active in the network [either as a recipient or originator of a ledger change] during that day.” The report noted,
“Kin 2 has significantly more originating active addresses than Kin 3. Although Kin is in the process of migrating to Kin 3, it appears that Kik is using data from the Kin 2 chain to support their claims about usage.”
Further, Kin 2 and Kin 3 had more active addresses that received payments than originated payments, which meant that there were more “earners” on Kin than “spenders,” also noting that only 35,000 addresses held over 10,000 kin [nearly $0.23]. The report added that the figures are lower than other blockchains which have a minimum of 1,000,000 addresses with at least $1.
After examining multiple critical aspects, Coin Metrics concluded that Kin fell below dominant blockchains in terms of daily active addresses, despite maintaining steady growth. It said,
“A majority of Kin’s active addresses have small account balances. While this makes sense for a network built around micropayments, when viewed across multiple metrics, our data show that Kin is not more widely used than dominant chains such as Bitcoin or Ethereum.”
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