ERC-20 on Cardano: A New Standard for Managing Meta Assets
Harmonic Labs has proposed a new standard for managing ERC20-like assets on the Cardano blockchain. The Cardano Improvement Proposal (CIP) aims to provide a solution for interoperability and emulating the behavior of account-based ledgers tokens on Cardano.
What is Meta Assets?
Meta assets are digital assets that exist only within smart contracts. They are similar to digital coupons that you can use to buy something, but you don't own the coupon itself. You can transfer them from one person to another, like giving someone a gift card. However, the smart contract is like the store that issued the gift card. The store is the one that controls the card, not you. Meta assets, like ERC20 tokens, exist only within smart contracts and offer programmability over transfers. However, it also means that the ownership of the asset is held by the smart contract, not the individual.
This new standard, if adopted, would allow for greater flexibility and programmability when it comes to managing digital assets on the Cardano blockchain without the need for modification of the main ledger. It would be like having a digital wallet that can hold different types of digital coupons, and you can use them to make purchases without having to ask the store to change their system.
CIP Still a Draft
It is worth noting that at this moment this CIP is only a draft and may contain errors in the logic. Anyone who spots errors or has suggestions for improvements is welcome to contribute their thoughts. This proposal addresses the CPS-3 (Smart Tokens) which can be implementable already with V2 Plutus contracts. The CIP proposes a solution to CPS-3 which is related to the implementation of smart tokens on the Cardano blockchain.
Overall, this proposal offers a new way for Cardano to support different types of digital assets and provide interoperability which is similar to being able to use different types of plugs in one outlet, which can benefit the whole ecosystem.
The proposed standard for ERC20-like assets on Cardano is an exciting development that has the potential to greatly benefit the Cardano ecosystem. The ability to manage digital assets on the Cardano blockchain without the need for modification of the main ledger opens up a world of possibilities for interoperability and programmability.
The community's contribution and suggestions to improve the logic is always welcome, and this is a great opportunity for the community to come together and shape the future of the Cardano blockchain. This proposal is a positive step forward for the Cardano community and we look forward to seeing the potential impact it could have on the blockchain landscape.