Flexible As SFTs possess the traits of changing from being fungible to non-fungible, the token holders can utilize them as per their trading needs.
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With the introduction of NFTs, the probability of assets being a victim of forgery can greatly be reduced by converting any type of asset into Non-Fungible Tokens. Any typical asset, when converted into an NFT, isn’t prone to duplication. The NFT trading platform where these NFTs are bought and sold will function on the basis of conditions that are embedded in the smart contracts. In contrast, semi-fungible tokens (SFT) wear dual attires - fungibility and non-fungibility.
These semi-fungible tokens can be exchanged like cryptocurrencies during their fungible state and become unique and non-interchangeable during their non-fungible state. For the purpose of converting fungible tokens to NFTs and vice versa, smart contracts are coded and executed. With Appdupe as your SFT development company, you can avail of development services for semi-fungible, non-fungible tokens, and NFT marketplaces.
As the name is self-explanatory, semi-fungible tokens represent the property of being both fungible and non-fungible, however, not both at the same time. An SFT will first carry the trait of being fungible, i,e., it will possess a certain value that can be redeemed or exchanged for another token. Once that token is utilized in the said way, it will lose its fungibility and become entirely non-fungible.
The best example you can relate to resides in the P2E gaming platforms. In such gaming platforms, the players will purchase the in-game assets using native tokens, which are fungible, of course. And the in-game assets like weapons, skin and other assets purchased by the players are non-fungible tokens.
Redeemable Tickets Digital tickets have now become the norm, irrespective of them being movie tickets, concert tickets, or any event tickets. These digital tickets will be fungible tokens before it is redeemed, i.e., the ticket holder can exchange the ticket with another ticket specifying the same event details. However, once the ticket is used, it becomes a digital collectible, a.k.a an NFT.
In-Game CollectiblesBlockchain games featuring Play-To-Earn models contain semi-fungible tokens. The native tokens with which the player buys collectibles are fungible, and those collectibles are non-fungible.
Coupons A typical coupon containing utility values can also be an SFT. Similar to tickets, promotional coupons are also SFTs before they are redeemed and NFTs after redemption.
Now you know that the definition of SFTs lies between fungible and non-fungible tokens. The pre-coded smart contract decides the transformation of the fungible tokens into non-fungible ones. These smart contracts will permit the transfer of multiple tokens all at the same time and run multiple tokens on the same smart contract as well.
As of the present time, SFTs are still in their budding stages with respect to their use cases in different business applications. However, the SFTs have acquired the gaming niche, where their use cases are prominent. Similar to tickets and in-game currencies, semi-fungible tokens also find their application in lotteries, where the lottery ticket will initially be a fungible token. After an individual buys that lottery ticket and draws the prize money, then that ticket becomes unique and non-interchangeable and hence, a non-fungible token.
Flexible As SFTs possess the traits of changing from being fungible to non-fungible, the token holders can utilize them as per their trading needs.
Reliable A typical SFT is built using the Ethereum standard, which assures the reliability of those tokens.
Liquidity SFTs, when exchanged between the owner and the buyer, remain fungible, which denotes that the token still holds face value. Thus, those fungible tokens will enhance liquidity.
Easy To MintSemi-fungible tokens are relatively easy to mint and cost fewer gas fees when compared to fungible or non-fungible tokens.
Single Smart ContractBoth fungible tokens and NFTs can be deployed on a single, smart contract itself.
SFTs are currently finding their use case in blockchain games. If you’re puzzled about the token standard used for creating such tokens, here is an outline of the same. Generally, NFTs that are built on Ethereum use the ERC-721 token standard. Whereas fungible tokens built using the Ethereum blockchain will be based on ERC-20. To put it in exact words, SFTs are developed using the ERC-1155 token standard to indicate their property of being semi-fungible.
Having around 10 years of focused experience in blockchain application development, we stand as a pioneer in delivering futuristic and robust development solutions. In that sequence, we provide semi-fungible token development services alongside our established white-label NFT marketplace development solutions. Get to know what makes us your preferable technology partner for developing your SFTs.
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