ERC-6147: Interpretation of the Semi-Mandatory NFT Property Separation Standard

On March 7, 2023, the Ethereum Improvement Proposal EIP-6147 officially entered the Final stage. This standard is an extension of ERC-721, aiming to separate the ownership and transfer rights of NFTs and SBTs, and introduces a new "Guardian" role that can set expiration times. This innovation makes applications such as anti-theft, lending, leasing, and SBTs more flexible for NFTs.

Background

The insufficient liquidity of NFTs has always been a heavily discussed issue. This problem not only arises from the NFT protocols themselves, but more importantly, how to give NFTs practical use value rather than relying solely on market speculation. Existing NFT protocols have some limitations that affect the utility value of NFTs.

Property Coupling Issues

The current NFT protocols have the issue of property coupling. For example, in NFT lending, the owner needs to transfer the NFT to the lending contract, losing the right to use the NFT during the lending period. This is different from asset collateral in the real world, which typically does not affect the right to use the asset.

In addition, SBT (soulbound token) faces similar issues. When a user's private key is lost, recovering the SBT becomes very difficult. Ideally, the SBT should be recoverable or reclaimable under specific conditions.

The challenges of the property separation plan

There have been previous attempts to implement property separation schemes, such as ERC-4907 and ERC-5058. These schemes face challenges in controlling the degree of enforceability.

ERC-4907 adopts a simple philosophy, where the vision is defined and then decided by consensus. It adds a "user" dimension on top of ERC721, but the mandatory aspect is limited; transfer operations can forcibly terminate rental authorization.

ERC-5058 adopts a "zero trust" philosophy, implementing a strict locking mechanism through code. It offers the functionality of locking upon transfer, but may not be widely adopted due to high mandatory requirements and operational complexity.

The Operating Mechanism of ERC-6147

ERC-6147 defines a role called Guard, similar to UserInfo in ERC-4907. Only the current owner of the NFT or an authorized address can set the Guard. The information of the Guard includes the address and expiration time, which can be queried through the guardInfo method.

The Guard has the authority to enforce transfers. For NFTs that have a Guard set, only the Guard can execute transfer operations. The original holder retains only the holding rights and loses the transfer rights. This means that on some NFT trading platforms, although the original holder's signature is valid, they cannot actually execute the transfer.

It is worth noting that if the Guard directly transfers the NFT, the Guard's settings will not be automatically cleared. To address this, ERC-6147 provides the transferAndRemove method, which can clear the Guard information after the transfer.

Guard cannot set up automatic deduction authorization, which is to prevent the situation where after Guard returns the transfer rights, the NFT is transferred through the approve method.

Summary

Compared to ERC-4907, ERC-6147 has optimizations in terms of compatibility. It does not require the project to actively acknowledge new roles; it is sufficient to acknowledge the owner, making it easier to adapt to existing application protocols.

In addition, ERC-6147 also proposed the concepts of "manageable SBT" and "effective SBT", providing new ideas for the management of SBTs, such as social recovery and reclaiming SBTs.

With the continuous development of the Ethereum ecosystem, there have been over 6,500 proposals surrounding EIPs. The emergence of ERC-6147 provides more possibilities for the application of NFT and SBT, and is expected to drive further innovation in this field.