Blockchain developers introduced an upgraded version of the ERC721 standard with a cashback function for NFT purchases
The standard of tokens based on the Ethereum blockchain under the code ERC721 received an upgraded version with a chargeback function. A novelty called ERC721R adds functionality to smart contracts to refund funds for issuing non-fungible tokens (NFTs) at cost during a specified refund period.
As stated in the description, the technology could potentially solve the problem of fraud, when the creators of NFT collections hide after the sale of tokens without fulfilling other obligations. Also, the cashback feature addresses the threat of an NFT dump in order to lower the average price tag for tokens, since there will always be an opportunity to request a refund.
“The NFT market needs more accountability. It faces too many obstacles, and for the health of the NFT ecosystem as a whole, we need better mechanisms to prevent them,” the developers say.
In fact, the ERC721R standard works like this:
- When creating an NFT collection, the funds spent on generating tokens are held by a smart contract in escrow.
- Collection creators cannot withdraw funds until the investment freeze period has ended.
- During the prescribed period of time, buyers can return NFT to the smart contract and receive back the ETH cryptocurrency (subject to payment of transaction fees).
It is known that some projects have already taken advantage of the refund function. For example, the Exodia project offered 14 days for a refund, and the NFT game Curious Addy’s Trading Club offered a “window” of 100 days. In the future, the developers plan to add the function of gradual unfreezing of assets.
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