The gambling industry appreciates blockchain technology and the products it has birthed. Casinos adopted cryptocurrencies as payment methods even when many others were in doubt. When NFTs made their way into the digital space, software providers also looked into it to see how it could significantly change online casino games. Today, we have multiple GambleFi tokens in the decentralized market. All these put-together show operators are always on deck to see how gaming can move to the next level. The next big thing everyone is talking about is SFTs. But will they change anything since NFTs came first? Well, time will tell. NFT vs SFT is a crucial topic to discuss.
In this casino news, we will help you understand what they mean and how they differ.
NFT vs SFT: Digital Rarity or Standard Currency?
When you compare NFT vs SFT, you find that they have a different starting from what they represent. SFTs mean “Semi-Fungible Tokens”, while NFTs mean “Non-Fungible Tokens.” Fungible, the principal concept common to both, means equal asset exchange. Let’s break this down. Let’s say you have a gold bar worth $1,000, and a friend of yours has a gold wristwatch also worth $1,000. If you exchange your bar for the wristwatch, do they still hold the exact monetary worth? Yes, they do. That is what fungibility is all about. Crypto coins and fiat fall under the fungible tokens category.
Now, what are NFTs? Non-fungible tokens are assets that cannot be “equally” exchanged because they are distinct in utility, value, characteristics, and availability. NFTs are often paintings, pictures, music, videos, literature, memes, in-game assets, and many other items that can be in digital form. But, once you obtain an NFT, you cannot exchange it with another, even if they are similar. This is because every NFT has a unique digital stamp on the blockchain network, often Ethereum. They are under the ERC-721 protocol.
SFTs, on the other hand, are hybrid tokens. They are fungible first and non-fungible later. A semi-fungible token is an asset that can be exchanged for another token of the same class or value. But once used, it loses its exchange properties and becomes Non-Fungible. An SFT is created using the ERC-1155 protocol.