ERC-7660: Redefining Meme Coins With a New Benchmark
Ever since the launch of Dogecoin (DOGE), Elon Musk's favorite digital asset, 11 years ago, meme coins have been a prominent and colorful part of the overall cryptocurrency ecosystem. Their popularity has surged in the last few years, first with the arrival of Dogecoin's archrival Shiba Inu (SHIB), and more recently with the growth of Solana-based meme coins like Dogwifhat (WIF), Catwifhat (CWIF) and Popcat (POPCAT).
While meme coins can be a lot of fun and, in some cases, profitable investment, they’re also often associated with scams, rug pulls and obscure token distribution schemes. The proposed ERC-7660 Ethereum (ETH) token standard and protocol is designed to support fair, equitable and transparent launches of meme coins. Introduced by the blockchain development outfit Benchmark Labs, ERC-7660 is probably the first structured attempt to bring standardization, better security and transparency to the world of meme coins.
Key Takeaways:
ERC-7660 is a new token standard for Ethereum meme coins, currently at the stage of pre-examination approval.
The standard extends Ethereum's main fungible token standard, ERC-20, and adds new features, such as timed linear release of funds, time-based lock-up functionality, a sorter algorithm for more efficient transactions and a low-cost swap mechanism.
ERC-7660 fosters community building with a Fair Launch feature that permits the automatic launch of its tokens, and Benchmark Pass, which bestows upon holders a range of privileges, including airdrops and referral rewards.
What Is ERC-7660?
ERC-7660 is a token standard for meme coins being developed for the Ethereum ecosystem by a blockchain development team, or possibly a sole developer, known as Benchmark Labs. It aims to make the launch and distribution of meme coins more transparent, fair, efficient and secure. This is potentially a critical development initiative — not only for Ethereum, but also for the entire blockchain industry — since meme coins are frequently associated with a variety of scams and obscure launch mechanisms.
ERC-7660 builds upon the popular ERC-20 standard by introducing the functionality of a consensus period, which specifies a linear timed release of tokens over predefined periods controlled by the issuer. It also offers features such as prespecified token lockup periods, a sorter algorithm for optimal transaction handling, an efficient transaction fee collection mechanism and a low-cost swap algorithm.
As of mid-June 2024, ERC-7660 is at the stage of a proposal submitted to the Ethereum Foundation, the organization responsible for considering and approving any technical innovations or token standards for the blockchain. In late May 2024, the proposal passed its pre-examination stage, but has yet to be fully approved as a finalized token standard.
The first token launched using the ERC-7660 protocol is BENCH. Benchmark Labs introduced this token to demonstrate the features and functionalities of the new standard. So far, at least two more ERC-7660 tokens have also been launched. These are DICK, the first ERC-7660 token launched after BENCH, and Calm Baboon (BABO). Naturally, being meme coins, both of these colorfully named cryptos have no specific practical utility.
How Does ERC-7660 Work?
ERC-7660 introduces several functionalities, among which a consensus period of a linear timed release of tokens is the fundamental improvement over existing token standards. Token issuers can specify a period — e.g., seven days, 30 days or whatever option they prefer — over which their token will be linearly released to specific addresses. For instance, if the issuer specifies a release period of 10 days and plans to airdrop 1,000 tokens into your wallet, you’ll receive 100 tokens every day for 10 days. Other users receiving the tokens will also have the same linear release schedule. This linear release functionality allows token issuers to offer more predictable and transparent release schedules.
The ERC-7660 protocol also provides lockup functionality, whereby token balances can be locked over a defined period of time in order to prevent arbitrary transfers. This helps improve the security and transparency of token operations.
You can automatically launch ERC-7660 tokens without a code via the Fair Launch functionality, and bridge them across chains easily using a Layer 0 blockchain via the official Benchmark Labs website's cross-chain bridge.
Other useful features of the ERC-7660 standard include a sorter algorithm for efficient transaction handling, and a swap mechanism that minimizes transaction fees.
Benefits of ERC-7660
Community Building
The ERC-7660 protocol allows token issuers to build communities around their tokens instead of simply launching a meme coin and expecting it to take the market by storm. Projects initiated through Fair Launch are supported by the Benchmark Pass functionality, which offers its holders airdrops and rewards for referrals and for completing social tasks, both of which contribute to a sense of community among token holders.
Improved Transaction Experience
The ERC-7660 standard also offers significant improvements in transaction efficiency and costs. Its sorter algorithm optimizes the order of token operations, promoting faster, more scalable transactions. In addition, its optimized token swap model reduces the computational requirements involved in swap operations, thus helping to reduce transaction fees.
Customizable
ERC-7660 is a flexible and highly customizable standard. After initial deployment, additional consensus period features, such as protocol treasuries and liquidity pools, can be included.
ERC-7660 vs. Other ERC Standards
ERC-7660 is among the newer token standards hoping to join Ethereum's list of fully approved standards. Following is a list of some of the most popular and functionally important token standards underpinning the operations of the Ethereum blockchain.
ERC-20
ERC-20 is a fungible token standard first introduced in late 2015. It specifies rules (for creating cryptocurrencies) that power the functionality of decentralized apps (DApps) on Ethereum. The ERC-20 standard was later extended to many other Ethereum virtual machine (EVM)-compatible blockchain networks. ERC-7660 directly extends ERC-20’s capabilities, introducing additional features such as a timed linear release.
The main features of the ERC-20 token are fungibility, and compatibility with EVM smart contracts. These attributes led to explosive growth in the number of DApps on Ethereum, establishing it as the leading smart contract chain and creating new crypto use cases in areas like decentralized finance (DeFi), gaming, SocialFi, decentralized physical infrastructure networks (DePIN) and many more.
ERC-721
Introduced in 2017, ERC-721 is Ethereum's primary standard for non-fungible tokens (NFTs). While ERC-7660 and ERC-20 provide specifications for fungible cryptocurrencies only, ERC-721 defines rules for creating distinct, non-fungible assets on Ethereum. ERC-721 helped popularize the concept of NFTs in the crypto industry, with the NFT market eventually experiencing a spectacular boom in 2021. While ERC-20 helped start a DApp revolution, ERC-721 was the main catalyst for the NFT concept's growth.
ERC-1155
The tokens standards discussed above all focus on defining rules for one type of token (fungible cryptocurrencies in the case of ERC-7660 and ERC-20, and non-fungible tokens in the case of ERC-721). However, some Ethereum applications and smart contracts require simultaneous handling of both token varieties. This is what the ERC-1155 standard is designed for: ERC-1155 is Ethereum's main multi-token standard. It specifies rules for creating smart contracts capable of handling fungible, non-fungible and semi-fungible tokens.
ERC-5169
ERC-5169 is a standard for smart tokens on Ethereum. These tokens contain embedded executable programming logic, essentially making each one a standalone "mini-DApp." These smart tokens offer diverse use cases, from the creation of dynamic NFTs to interaction with Internet of Things (IoT) devices. The ERC-5169 standard radically differs from ERC-7660 and the other Ethereum standards covered above as it's the only standard capable of supporting executable logic and functionality. A relatively new standard, it was first proposed in 2022 and formally adopted in 2023.
Future of the ERC-7660 Token Standard
The ERC-7660 standard has already received pre-examination approval from the Ethereum Foundation, which indicates that the token may be fully endorsed in the future, perhaps as early as this year. If fully adopted, ERC-7660 will undoubtedly become one of the most frequently utilized standards, thanks to meme coins' widespread and unrelenting popularity.
The overall support that the ERC-7660 protocol receives from Benchmark Labs is among the key factors pointing to a promising outlook for this new standard. Benchmark Labs continually supports and improves upon it, adding or optimizing features like the sorter and low-cost swap algorithms. The support that new ERC-7660 tokens are receiving from Benchmark Labs also helps foster and develop a sense of community around the standard and its protocol.
The Bottom Line
The proliferation and popularity of meme coins in the crypto world was bound to lead to more efforts at their standardization. ERC-7660 from Benchmark Labs is the first significant step in this direction. As a token standard and a protocol for launching compliant meme coins, ERC-7660 will play a key role in bringing better security, transactional efficiency and transparency to the chaotic world of meme coin assets.
Although there are still very few ERC-7660 tokens launched, this is likely to change with the final approval of the standard by the Ethereum Foundation. Naturally, while this approval isn’t guaranteed, there are strong indicators that the Foundation appreciates the merits of the new standard, and isn't averse to fully adopting it. Soon, transparency and standardization for meme coins may no longer be unrealistic, thanks to the ERC-7660 token standard.
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