With no pre-mining and a fair launch, how did the FairERC20 protocol become so popular overnight?

How did FairERC20 gain overnight popularity despite no pre-mining or unfair launch?

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In March of this year, the BRC20 token was successfully deployed on the Bitcoin chain through Ordinals. With its fair distribution mechanism, simple protocol design, and decentralized features, it has attracted a lot of attention and funding from users. BRC20 has created a new era, not only for the Bitcoin ecosystem, but also for other public chains’ thinking about the concept of fair coin distribution.

Ethereum, as the largest mainnet public chain in the current ecosystem, has always had a drawback in its ERC20 token issuance protocol. The customizability of smart contracts may lead to unfairness in the token issuance process for some projects. Malicious contracts, blockage attacks, and exchange manipulation can all disrupt the fairness of token issuance. Bitcoin has a relatively simple and decentralized advantage in equal distribution, while Ethereum provides more flexibility through smart contracts and programmability. The combination of the two has been an industry goal in achieving a fair distribution model on Ethereum.

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Recently, a new protocol based on the ERC20 scheme called FairERC20 has been active in various communities. Through smart contracts, it implements the idea of fair coin distribution of BRC20 on Ethereum (and other EVM chains). The protocol has developed a simple and fair token issuance platform on Ethereum, where anyone can issue coins, enhancing transparency and community participation, achieving technological inclusiveness and decentralization. Therefore, this protocol has exploded in various communities on the second day of its launch.

In response to this phenomenon-level product, Web3CN interviewed jackygu and made a detailed report on the protocol. (See the end of the article for the interview transcript with Professor Gu Qianfeng.)

What is FERC20

We know that ERC20 is a standard token issuance protocol based on the Ethereum network. With ERC20, developers can efficiently, reliably, and inexpensively mint their own project’s dedicated tokens. ERC20 has a public function called totalSupply, which displays the current circulation of the token and can be called by all functions. Whenever a new token is added to the market through mining, the logic will update the value of the internal variable totalSupply_.

There are generally two ways to issue totalSupply: one is to first mint all the tokens and send them to the management account, which will distribute them to the target accounts; the other is similar to Bitcoin, by minting from scratch through contracts, without going through the management account, and directly sending them to the target account, with a hard cap to set a ceiling.

Currently, the first model is the most well-known. This model is relatively centralized, with account management generally controlled by the team, making it prone to misconduct. However, users generally feel better because totalSupply does not increase. The second model gives the impression of increasing supply, but in fact, it only increases from zero to hardcap, giving the impression of ongoing token inflation. However, this model does not mint all tokens at once, which to some extent reduces the risk of team misconduct.

FERC20 is essentially based on the ERC20 standard. It combines the decentralized issuance of BRC20 with the programmability of the ERC20 smart contract to create a new token protocol standard for fairer token issuance on Ethereum.

FERC20 Features

Since FERC20 is based on the ERC20 standard protocol, it has features that BRC20 does not have, including but not limited to:

• Can be conveniently transferred in wallets that are familiar to the public without downloading new wallet software;
• Can be used in Ethereum’s powerful DEFI ecosystem, including DEX, lending, multisig, and more;
• FERC20 tokens have no owner permission, i.e., there are no owner tokens;
• Tick character count can be upgraded;
• No pre-mining, tokens are mined from zero to hardcap;
• Highly decentralized, the system architecture is serverless, including search, lookup, and other functions, all of which are performed in smart contracts;
• Users interact directly with the contract.

However, since FERC20 is implemented on Ethereum, it still needs to guard against 51% attacks and smart contract robots. Therefore, the protocol adds three sets of attributes based on the ERC20 standard contract:

• Freezing period:

After the user mints for the first time, they enter a freezing period during which they must pay a fee to continue minting. Each additional minting doubles the fee. For example, for the first minting during the freezing period, 0.00025 ETH is paid, for the second minting, 0.0005 ETH is paid, and for the third minting, 0.001 ETH is paid, and so on.

It should be noted that for FERC20 with a cooling-off period, bulk coinage (Rollup Mint) cannot be performed.

• Holding Conditions:

The deployer can set holding conditions to prevent witch accounts from minting coins on a large scale and quickly.

Holding assets include NFTs and other ERC20 tokens.

• Presale/Crowdfunding:

The deployer can set the presale/crowdfunding price of the token to charge a fee when minting coins.

There are eight subtypes in total depending on the different combinations of the three groups of attributes. The issuer can set the above three groups of attributes as needed when deploying the token contract.

Deploy FERC20 Token:

Free (only pay Gas fee)

Mint FERC20 Without Cooling-off Period:

Free (only pay Gas fee)

Mint FERC20 with Cooling-off Period:

The first time is free. After entering the cooling-off period, the second time will be charged 0.00025ETH, and the third time will be charged 0.0005ETH, doubling each time until the cooling-off period ends, and there is one free minting again.

Mint Crowdfunding FERC20:

A 1% handling fee is charged each time. If the crowdfunding price is 0.1ETH per FERC20, the handling fee is 0.001ETH, and 0.099ETH will be immediately transferred to the organizer’s account.

Analysis of the Reasons for the FERC20 Boom

The reason why FERC20 has caused a huge response in the community in just a few days since its launch is that its appearance has allowed the community and users to see the co-construction, consensus, and fair and free cryptocurrency environment, which has brought more decentralization practices to Ethereum. Like Bitcoin, the technical value, consensus value, and fair concept have jointly promoted the success of FERC20.

1. From an ecological perspective, as the first token on the erc20.cash platform, $ferc has opened up a new chapter in the fair distribution of tokens on Ethereum. The huge traffic on Ethereum gives it ample room for imagination, and in the future, $ferc will empower various project ecosystems. The perfect underlying protocol and sufficient ecological construction have also raised users’ expectations of it.

2. From a fundamental perspective, FERC now has over 4,000 addresses, and the holding addresses are dispersed, indicating that the token has undergone sufficient turnover and has a high degree of decentralization. In terms of trading volume, holding addresses, and pool amount in the FERC20 sector, it is ranked first, so funds are naturally willing to gather here.

3. From a social perspective, all dissemination is now spontaneous by the community, reflecting a strong community consensus. A community sBlockingce was held on the evening of June 5th, which lasted nearly four hours and was attended by 1,500 people. Many of the speakers and listeners were KOLs, and there was also attention from overseas communities. This represents the initial formation of the FERC20 consensus, and the next step is the process of continuous diffusion.

FERC20 opportunities and risks

Opportunities

Since its release, FERC20 has quickly become popular in various communities. FERC20 applies the mechanism of BRC20 (no VC, no reserved tokens, no rat warehouses) to the ETH chain to issue tokens with one click. It not only absorbs the fair distribution characteristics of BRC20, but also combines the combinability gameplay of DeFi ecology in Ethereum. Therefore, it can be used in the Ethereum ecology, and may be the main battlefield for meme coins in Ethereum in the future, which is also the reason for the sensation.

Of course, its greatest competitiveness still lies in its backing of the Ethereum network. DeFi, wallets and other ecosystems may be seamlessly integrated, combined with a more decentralized token issuance mechanism, and the next round of FERC20 frenzy may promote the narrative based on FERC20’s unique DeFi ecology.

Risks

Firstly, the contract has not been audited. Secondly, FERC20 has only solved the problem of fair distribution of tokens, and the tokens have not been empowered and have low liquidity, so caution should be exercised when participating to prevent token price speculation.

Attachment: Interview with Gu Qianfeng

Web3CN: What was the idea and purpose behind creating erc20.cash at the time? How long did it take to deploy this platform?

jackygu: In mid-April, I started to get in touch with BRC20 and felt its two characteristics: fair sales and ownerless tokens. At that time, I didn’t think about whether this mechanism could be applied to Ethereum, but I think it should be feasible. When I consulted several friends, they raised a question that there are too many bots on Ethereum. If this mechanism is implemented on Ethereum, it is technically feasible. However, BRC20 of Bitcoin naturally prevents the brush-ordering robot through the slow mechanism of Bitcoin. Although Ethereum has a lot of traffic and users, to implement this mechanism on Ethereum, the problem of “brush-ordering robots” must be solved first. If this problem is solved, then this is definitely a great product. So, I started to study this problem and began to write contracts and front-ends from May 26. The deployment was completed in 5 days.

Web3CN: Your first token, $ferc, was minted within a few hours of deployment and its price skyrocketed in just a few days. Was this within your expectations? Did you anticipate such a big reaction from the community?

jackygu: Actually, it was completely unexpected, because I initially guessed that it would take three to four months for FERC20 to be minted. This is because @domodata took about two months from proposing the BRC20 protocol to issuing the first token, $ordi. Also for this reason, I only minted one (1000) for testing myself.

As for the other question, I would like to say that I have always had some ideas about the current coin circle, which is completely different from the Bitcoin era. In the Bitcoin era, people often focus more on sharing, co-construction, consensus, and fairness, but in the Ethereum era, especially in the ICO of 2017, a series of very negative effects were caused, such as a large amount of capital entering, making the coin circle a purely profit-making tool. I have always believed that there will be something new to change this situation, and this new thing will cause a great reaction in the community, but I did not expect this new thing to come so soon, and I did not expect it to be a small application that I made unintentionally.

Web3CN: Why do you think $ferc has risen and what is the reason for its success? What kind of people are holding $ferc and even pushing up its price?

jackygu: The reason why $ferc rose is not believable when I say it. Many people think that I must be manipulating it and injecting millions of liquidity, but in fact, our team has not paid our salaries for more than half a year and we are broke.

I think the reason why ferc20 is sought after is the same as Bitcoin, which is driven by three forces. The first is technology, which represents productivity and products; the second is culture, which represents dissemination power, and can promote and form consensus, just like the “gift coin movement” I initiated on Twitter today, which is essentially a cultural movement; the third is fairness. On the homepage of my Twitter, there is a picture that vividly explains what is fairness, what is equality, and what is the status quo. When you see this picture, you will understand. In human history, it is very difficult to achieve fairness, but it can be achieved through technological means. We block big capital and scientists (the term for people who use scripts to operate in batches and cheat) through a fair launch mechanism. Currently, FERC20 has been upgraded to the V2 version, but it has not yet blocked all the cheaters. We hope that the next version, V3, can block most of the scientists and allow everyone to participate fairly in the fair launch.

These three points are the reasons for the rise of $ferc. As for the type of person who is holding or even promoting the price, I think there is a consensus that everyone is holding and pushing it.

Web3CN: We see that you are launching a “coin-giving campaign” on Twitter. Your point of view is that the recipients of the given coins will not sell, thus achieving a locked and deflationary state. However, from a human perspective, most people buy cryptocurrencies for profit, and not realizing their profits is actually against human nature. I wonder what your views are on this issue?

jackygu: I have thought about these issues from a human perspective. Airdrops are very popular in the cryptocurrency world, but I have my own opinion. If tokens are airdropped to strangers who only provide an account, these strangers will immediately sell the tokens once they receive them. However, if these tokens are given as gifts between friends and relatives, especially those who have heard of cryptocurrencies and bitcoin but have never owned them, they will cherish this gift and may not sell it. I have experienced this firsthand.

The value of giving away cryptocurrencies lies in the fact that this gift is tamper-proof, just like a permanent diamond. This kind of human relationship means a lifetime, and the cost is not high, it is a truly light but deep gift. In addition to human relationships, there is also knowledge sharing. When you teach friends how to create a wallet, you are actually sharing knowledge about the future digital world. This cryptocurrency is part of the future digital world.

Therefore, the social value of giving away cryptocurrencies is very high. It can even be said that the reason why bitcoin can come to this day is closely related to the large-scale giving away of bitcoin in the early days. It should be noted that if strangers only leave their address and ask me for coins, I will not give them. I will only send tokens to offline friends I know, such as relatives and friends on WeChat. By giving away tokens, we expand the circle, make the currency circle warm, sunny, and full of positive energy, and make the currency circle an industry respected by others. Isn’t this a good thing?

Web3CN: The success of $ferc has also caused many imitations. They have deployed this model on chains such as arb, zksync, etc. What do you think of these imitations? Will they dilute the value of $ferc?

jackygu: Actually, I am very welcoming of imitations, because it can expand the influence of this matter, which is a very good thing. However, compared with technology and products, the more important thing is the spirit of fairness. If those platforms recognize and practice this spirit, there is no possibility of cooperating together to promote it.

$ferc is certainly important, but I am looking forward to seeing the promotion of this matter to the cryptocurrency industry. Having one more platform participating in the action is good in my opinion.

Web3CN: I saw you say in your circle of friends that $ferc will be an important empowerment for your web3 social project Chatpuppy, could you share more details?

jackygu: This empowerment is a series of actions. I have an action list, but this list cannot be made public for the time being. I think that in addition to technological and application empowerment, the empowerment in the currency circle cannot ignore cultural empowerment and fairness empowerment. Fairness occurs at the contract layer and is achieved through technologies such as smart contracts to achieve fairness. Cultural dissemination occurs at the social layer. For example, the “coin gifting movement” is actually social and has cultural attributes. It allows everyone to participate in this matter, own this coin, and make friends with each other. Social needs tools, we cannot do it on Web2 social tools such as Telegram or Discord, because they do not have wallet and encrypted asset holding filtering mechanisms, so we need to use Chatpuppy. For example, there are many $ferc holders on Chatpuppy, and a requirement of 100 $ferc can be set, and you must have these assets to enter the group.

The above $ferc empowering Chatpuppy is just a case of self-experimentation, as a stepping stone, I hope more people will use the social attributes, cultural attributes, and fairness of $ferc and various FERC20s.

Web3CN: $ferc itself represents a completely decentralized, fair issuance concept. If artificially empowering $ferc, will it destroy this spirit and make it centralized?

jackygu: Indeed, many people in the community are asking how to empower $ferc. I always answer that there is no empowerment plan, because the biggest empowerment comes from the community, not from a certain project or individual. I cannot empower $ferc. The only empowerment can only come from their respective communities, which is the spirit of decentralization.

In recent years, we have seen too much “empowerment” jargon, empty talk, and scams, and heard too many “ecological” myths, but we have been constantly cut. This time, let go, no empowerment, no empty talk, no jargon, no ecology, no official, let each community play a subjective initiative, and see if we can open up a new sky.

Web3CN: Your recent popularity has drawn more attention to you personally, and it is known that your health may have been a bit of a problem, and people have some concerns. Can you share your current physical and mental status? Do you have any new thoughts or inspirations about life?

jackygu: I am in very, very good spirits now, perhaps because of the medication, quite excited! I originally wanted to keep it a secret all the time, but because of a small negligence, it was dug up by netizens. Now, let’s confess honestly, I discovered it myself in February of this year, and then went to check at Shangzhong and Ruijin Hospital. I was finally diagnosed in early April. I was quite uncomfortable for a while after the diagnosis, not physically uncomfortable, but psychologically uncomfortable. Later, I realized that I couldn’t stop doing things just because I was sick. Then I went to Hong Kong to attend the Web3 conference. As you can see, I didn’t look like I was sick in Hong Kong! But I was admitted to the hospital the day after I returned from Hong Kong to start treatment.

As for the question of what new ideas and inspirations I have about life, it’s like this. I often ask myself a question: What is the most important thing I want to do if I can only live for one year?

For this question, I believe everyone has their own answer. My answer is that if I can only live for a year, then I will treat this year as ten years, whether it is in family or work. I believe that with the current level of technology and medical care, there should be no problem for five or six years, and there may be a chance for ten years or more. If I live for more than ten years, according to the calculation of one year as ten years above, won’t I live longer than anyone else in the world?

Some of the things you are seeing now may have been accomplished under this motivation.

In conclusion:

Health is the foundation of the years, and success comes from having dreams! I hope Gu Lao takes care of his body and recovers soon! Firmly stick to your original intention and bring more vitality to the industry!

Disclaimer: This is an original work in Chinese by web3. The content only represents the author’s position and does not constitute investment advice. Please use caution. If this article/material infringes on any rights, please contact official customer service for resolution.

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