📄What is a Smart Contract?

Information about what an Smart Contract is

Smart contracts are an integral part of NFT infrastructure - without them NFTs cannot operate. They are made up of code that allow the storage and display of information, visible to anyone. This information is immutable due to the nature of blockchain networks, meaning it can’t be changed. If a smart contract is published containing code errors, it will remain that way forever. Smart contracts are used to determine certain actions, such as verifying ownership, showing token metadata, and enabling and recording transfer. They can also be extended to handle other useful and relevant use cases, such as royalty payments for an artist in future sales of an NFT.

The metadata of an NFT describes and gives information about the NFT.

Smart contract standards

The code in a smart contract determines the characteristics of the NFT and the way in which its data is displayed. Smart contracts tend to follow standards. In Ethereum, the primary standards for NFT smart contracts are ERC-1155 and ERC-721. In its simplest form, ERC-1155 is generally used for contracts with many non-divisible tokens with the same underlying metadata (think of a concert ticket or a library pass - they are unique and you cannot own 'half' a ticket, they are non-divisible; example). ERC-721 is generally used for non-divisible tokens, all of which have different metadata (example) whilst living in the same contract (think of individual players within a football team).