Ethereum developers have upgraded the ERC-721 standard, which is the basis for the NFT purchase refund feature.
Blockchain developers have upgraded the ERC-721 token standard based on Ethereum, adding a refund feature. The updated version is called ERC-721R and provides refunds for buying NFTs within a certain period of time after a transaction.
- The functionality of ERC-721R tokens has been updated in this way:
- The funds will be held by the smart contract in escrow when an NFT is sold.
- The creator will be unable to withdraw the funds until the waiting period is complete.
- During this period, the buyer will be able to return the purchased NFT using the smart contract and receive their funds back.
If the creator fails to fulfill the obligations undertaken during the fundraising period, the buyer has the opportunity to request funds back before the waiting period is over, paying only the commission costs.
The developers justified the need for such innovations by the necessity of the NFT space for greater accountability and the provision of security guarantees for the market participants, in particular — to prevent fraud.
In the future, the creators of the new ERC-721R standard intend to implement a more sophisticated means of reimbursement for both the buyer of an NFT and its creator. The developers are considering options to partially release funds from the smart contract monthly. This would potentially allow creators to access some of the funds but still leave reimbursement guarantees for the buyer.
Several popular projects have already tested the new functionality. For example, Exodia offers a refund within 14 days, CryptoFighters offers a 45-day refund period, and popular gaming site Curious Addys’ Trading Club (CATC) has included a 100-day money-back guarantee in its NFTs.
