MocktailSwap's ‘Semi-fungible token’ project launches on Binance Smart Chain
An up-and-coming DeFi protocol focused on automated market makers, MocktailSwap Finance has launched a so-called “semi-fungible token” on the Binance Smart Chain.
The semi-fungible token is based on Ethereum’s ERC-1155 standard which enables a smart contract to govern unlimited number of tokens.
ERC-1155 is a multi-token standard for “contracts that manage multiple token types,” according to a summary of the Ethereum Improvement Proposal (EIP). Moreover, ERC-1155 tokens can operate as either ERC-20 or ERC-721 standards at the same time even using the same address.
The benefits of ERC-1155, under the EIP proposal are described as follows:
“New functionality is possible with this design such as transferring multiple token types at once, saving on transaction costs. Trading (escrow / atomic swaps) of multiple tokens can be built on top of this standard and it removes the need to “approve” individual token contracts separately. It is also easy to describe and mix multiple fungible or non-fungible token types in a single contract.”
In the cake of Mocktail, the ERC-1155 token is “fungible” until it’s redeemed and while at the point of redemption, it becomes “non-fungible.” Upon redemption, the token will not hold any value and it could not be traded like a regular token. As such, these non-fungible tokens can be traded on the rapidly growing NFT market.
Launched in February 2021, MocktailSwap is a decentralized platform for token swapping which offers users higher liquidity and, in theory, more favorable rates. The protocol also claims to offer minimal fees and yield farming capabilities.