The #kripto world is currently being shocked by the emergence of a new trend, namely ERC-404 standardized tokens. Even though it is still in the experimental stage and has not been fully audited by external parties, this token has succeeded in attracting the attention of investors.
### Get to know ERC-404
ERC-404 is an unofficial #Ethereum token standard that gained popularity thanks to the Pandora project. Currently, Pandora's capitalization stands at US$234 million, with the #PANDORA token having a value of US$29,000, an increase of 10,000% since its launch on February 2.
ERC-404 combines the advantages of ERC-20 (regular tokens) and ERC-721 (NFT), where every purchase of one token will get one NFT. It is important to note that ERC-404 transactions occur in integer multiples, for example, one token gets one NFT, two tokens get two NFTs, and so on.
### Risks of ERC-404 Tokens
While it offers innovation, ERC-404 also has some risks to consider:
1. Unrecognized Status: ERC-404, although following the ERC standard format, is not yet recognized as an official Ethereum standard, it is only experimental.
2. Can't Choose NFT: Users purchasing ERC-404 tokens on Uniswap cannot choose which NFT to acquire, presenting a practical challenge.
3. Potential for Manipulation: There is a risk that NFT scarcity manipulation, with predictable algorithms, unfairly influences the market and distribution.
4. Experimental Stage: ERC-404 is still in the experimental stage, so investors are reminded not to be too tempted by hype and FOMO, while evaluating long-term practicality and stability.
While ERC-404 promises greater NFT flexibility, it is important for market players to consider these risks before fully adopting this mechanism.