What is ERC-404 Token Standard?

The ERC-404 standard is an experimental and unofficial token standard for digital assets on the Ethereum blockchain. It aims to combine features of the popular ERC-20 (fungible tokens) and ERC-721 (non-fungible tokens) standards, creating so-called "semi-fungible" tokens. Here's what you need to know:
Key features:

• Fractional ownership of NFTs: ERC-404 allows splitting a single NFT into smaller parts, enabling multiple wallets to own a fraction of the asset. This contrasts with traditional NFTs, which are indivisible.
• Native liquidity: Unlike existing fractionalized NFT solutions, ERC-404 tokens can be directly traded on decentralized exchanges without relying on intermediaries.
• Potential for innovation: This novel approach opens up new possibilities for NFT use cases, such as lending, fractionalized ownership of expensive NFTs, and creating derivative products.

Important points to consider:

• Experimental and unaudited: While ERC-404 shows promise, it is still under development and hasn't undergone thorough security audits. This presents potential risks for investors.
• Limited adoption: As of February 12, 2024, the standard is in its early stages and currently supported by a limited number of projects and exchanges.
• Technical complexity: Integrating ERC-404 tokens with existing DeFi protocols can be challenging due to its unique nature.

Overall, ERC-404 is an exciting experiment with the potential to unlock new avenues for NFTs. However, it's essential to understand its limitations and inherent risks before considering investing in any projects utilizing this standard.

Here are some resources to learn more:

• Decrypt article: https://bress.xyz/post/TSqaBPJggugD6GSVHvibE14TRo0-8sIExxfSd5QiaXE
• CoinDesk article: https://www.coindesk.com/business/2023/01/10/coinbase-plans-to-cut-950-jobs-by-end-of-q2/
• GitHub repository: https://github.com/0xacme/ERC404