An Ethereum standard called “ERC-404” is currently being developed by pseudonymous developers under the project name Pandora. The standard aims to combine the technology behind ERC-20 fungible tokens with ERC-721, which is used for non-fungible tokens (NFTs) like those found in the Bored Ape Yacht Club collection. Despite the name, ERC-404 has not been audited and is still in the proposal stage.
The goal of ERC-404 is to bind NFTs to ERC-20 tokens, allowing for fractionalized ownership of NFTs. This means that multiple wallets can each own a portion of a single NFT and use that portion for trading or staking. The developers behind ERC-404 are working on submitting an Ethereum Improvement Proposal (EIP) for the standard.
While the project aims to combine two incompatible standards in a robust manner, there are concerns about its safety. One developer claimed that NFTs using ERC-404 could be vulnerable to theft if deposited in a lending protocol that is not properly configured for ERC-404. However, the developer behind ERC-404 dismissed these concerns, stating that the vulnerability was due to improper usage of the standard.
Despite the safety concerns, ERC-404 has gained support from crypto wallets Binance and OKX. The first ERC-404 token, called Pandora, was launched on February 5 and has seen significant gains in value. Additionally, there are several other projects that have launched using ERC-404, including a frog-themed NFT collection and a collection of NFT pet rocks.
Overall, ERC-404 is an experimental Ethereum standard that aims to combine fungible and non-fungible tokens. While there are concerns about its safety, the project has gained support and has seen success in the market.