ERC vs. SPL Token Standards: A Comparative Analysis

In the dynamic world of blockchain, the recent surge in cross-chain interoperability and decentralized finance (DeFi) applications underscores the critical role of token standards. Among these, the Ethereum Request for Comments (ERC) and Solana Program Library (SPL) standards stand out, not just for their technological innovation but for their pivotal role in shaping the future of digital transactions and asset management. As we delve into the intricacies of SPL and ERC, we highlight their unique features, applications, and potential to revolutionize blockchain technology, guided by the analytical prowess of Bitquery API.

The Backstory of SPL and ERC Standards

Enter ERC – The Standardization Protocols within Ethereum

ERCs are pivotal in defining Ethereum's core protocols, client APIs, and contract standards. Born from the Ethereum Improvement Proposals (EIPs), ERC standards, particularly ERC-20, ERC-721, and ERC-1155, have become the backbone of Ethereum's digital asset ecosystem, ensuring consistent behaviour and interoperability of tokens, since the adoption of ERC20 in 2017.

The Ethereum blockchain's ERC token standards, offer a comprehensive framework for digital assets, ranging from fungible tokens like UNI and SHIB that facilitate utility and governance, to unique non-fungible tokens (NFTs) represented by ERC-721, enhancing the digital art, collectibles, and virtual assets market with examples like CryptoKitties and CryptoPunks. ERC-777 and ERC-1155 further evolve these concepts by introducing transactional 'Hooks' for more complex interactions and a unified standard for managing diverse asset types within a single contract, respectively, showcasing Ethereum's versatility and innovation in blockchain tokenization.

Read more about ERC token standards here: https://ethereum.org/developers/docs/standards/tokens

Introduction to SPL Standards

In contrast, the SPL standard of the Solana blockchain offers a unified approach to token management, accommodating both fungible and non-fungible tokens under a single protocol. This reflects Solana's architectural ethos of efficiency and scalability, catering to the high-performance demands of modern blockchain applications. It was launched alongside the Solana mainnet in 2020.

Read more about SPL token standards here: https://spl.solana.com/token

SPL Tokens: Unveiling Unique Features

SPL tokens distinguish themselves through several key features that deviate from the Ethereum-centric standards like ERC-20:

• Unified Standard for Fungibility: SPL tokens can be either NFTs or fungible tokens, with differences primarily defined at the minting stage. This contrasts with Ethereum's separate standards for fungible (ERC-20) and non-fungible tokens (ERC-721 and ERC-1155).

• Composability: Leveraging Solana's composability, SPL tokens can easily reuse code to facilitate rapid development and deployment of new tokens, enhancing the ecosystem's flexibility and developer efficiency.

• Efficiency: Reflecting the high-speed transaction processing of the Solana network, SPL tokens offer a more efficient transaction experience compared to their Ethereum counterparts.

Solana's Token-2022 Enhancements

In response to the complexities of crafting transactions with multiple token programs on the Solana blockchain, and the need for wallets and on-chain programs to trust supported token programs, a new solution named Token-2022 has been introduced. Deployed to a unique address, Token-2022 is designed to add new token functionalities with minimal disruption to users, wallets, and dApps, while ensuring the safety of existing tokens. This initiative promises new minting functions, including interest-bearing tokens and enhanced transfer capabilities, further solidifying SPL's position as a versatile and dynamic standard.

SPL vs. ERC-20 Tokens: A Comparative Overview

The main technical divergence between SPL and ERC standards lies in their architectural design and blockchain foundation. Ethereum's ERC standards, including ERC-20, ERC-721, and ERC-1155, provide specialized protocols for different token functionalities. This specialization allows for a broad range of applications but can lead to increased complexity and gas costs associated with deploying and interacting with multiple token types.

Conversely, the SPL standard on Solana streamlines token management by incorporating fungible and non-fungible token functionalities within a single protocol. This unified approach, combined with Solana's efficient consensus mechanism, offers lower transaction fees and faster settlement times, making it particularly advantageous for applications requiring high transaction throughput.

The ERC and SPL token standards both facilitate innovative blockchain applications but face distinct challenges, particularly regarding cross-chain interoperability. While ERC tokens benefit from Ethereum's extensive ecosystem and established standards, they are often criticized for high gas fees and network congestion. In contrast, SPL tokens offer efficiency and scalability but must overcome challenges in achieving widespread adoption beyond the Solana ecosystem, service failures and validator decentralisation.

The evolving landscape of blockchain technology, with emerging solutions like blockchain bridges and layer 2 scaling, suggests a future where SPL and ERC standards might increasingly interoperate or influence the development of new, more versatile standards. The blockchain community continues to debate the trade-offs between scalability, security, and decentralization, indicating that the evolution of token standards will remain a dynamic area of innovation.

Leveraging Bitquery API for Token Analytics

Bitquery API offering deep insights into token transfers, dApp interactions, and more. Bitquery indexes data from 40+ blockchains and provides GraphQL APIs and additional interfaces, including WebSocket.

With its comprehensive support for Ethereum's ERC and SPL tokens in V1 and the upcoming inclusion of Solana's SPL tokens in V2, the Bitquery API represents a crucial tool for developers, analysts, and enthusiasts seeking to navigate the complexities of the blockchain space. To get started for free, please create an account here with your email (https://ide.bitquery.io/) to get your API key and access to the bitquery IDE.

In the next seciton, we are going write GraphQL queries to fetch transfers data from both Ethereum and Solana.

If you're new to GraphQL or Bitquery, please check our documentation which shows how to get started with our IDE.

Fetching ERC20 Transfers

We will explore a simple query to fetch ERC20 token from Ethereum mainnet on 2nd March. You can try the query in the IDE.

{
  ethereum {
    transfers(
      date: {is: "2024-03-02"}
      options: {limit: 10, desc: "block.timestamp.iso8601"}
    ) {
      amount
      receiver {
        address
      }
      sender {
        address
      }
      transaction {
        hash
      }
      currency {
        name
        symbol
        address
      }
      block {
        timestamp {
          iso8601
        }
      }
    }
  }
}

Fetching SPL Transfers

We will explore a simple query to fetch ERC20 token from Ethereum mainnet on 2nd March. You can try this query in the IDE.

{
  solana {
    transfers(
      options: {limit: 10, desc: "block.timestamp.iso8601"}
      time: {after: "2024-03-02T23:45:00Z", before: "2024-03-02T23:50:00Z"}
    ) {
      amount
      block {
        timestamp {
          iso8601
        }
      }
      currency {
        address
        name
        symbol
      }
      receiver {
        address
      }
      sender {
        address
      }
      transaction {
        signature
      }
    }
  }
}

Conclusion

To sum things up, we looked at the key differences and similarities between the ERC and SPL token standards. While they both ultimately let you create and use digital assets, their approaches vary quite a bit because Ethereum and Solana have pretty different blockchain architectures and design goals. The ERC standards are more specialized for different token types, giving developers flexibility for all sorts of apps. But SPL takes a unified approach, prioritizing efficiency and scalability.

At the end of the day, it'll be up to projects and users in the space to decide which standard works best for their needs and use cases. No matter which way things go, Bitquery's API is super useful for deep analytics and monitoring across these standards. More than just tracking transfers, their API unlocks a ton of possibilities - compliance tools, custom dashboards, you name it. That versatility could be a game-changer for devs, analysts, and enthusiasts trying to make sense of this constantly evolving blockchain landscape.

About Bitquery

Bitquery is a set of software tools that parse, index, access, search, and use information across blockchain networks in a unified way. Our products are:

• Coinpath® APIs provide blockchain money flow analysis for more than 24 blockchains. With Coinpath’s APIs, you can monitor blockchain transactions, investigate crypto crimes such as bitcoin money laundering, and create crypto forensics tools. Read this to get started with Coinpath®.
• Digital Assets API provides index information related to all major cryptocurrencies, coins, and tokens.
• DEX API provides real-time deposits and transactions, trades, and other related data on different DEX protocols like Uniswap, Kyber Network, Airswap, Matching Network, etc.

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This article has been written by guest writer Anish Majumdar