Apart from the creation of decentralized applications (Dapps), Ethereum can serve other purposes such as:
- issuing other cryptocurrencies, or
- generating Decentralized Autonomous Organizations (DAO).
With respect to tokens, other cryptocurrencies can be created on the Ethereum system. Presently, two of the best-known token protocols on Ethereum are:
ERC-20 is a standard protocol which sets the rules for the issuing of tokens on Ethereum. They are fungible, which means their value is the same and interchangeable.
ERC-721 tokens, on the other hand, are non-fungible, which means that they are non-interchangeable and completely unique.
Simply put, you can consider ERC-20 as money and ERC-721 as collectibles like baseball cards or action figures.
DAOs are completely autonomous organization governed through code and not by a single individual. This code is smart contract based and allows DAOs to replace the operation of conventional organizations.
Running on code ensures that it is not affected by human intervention and will run transparently. Ultimately, no external influence will have any effect on it. DAO token voting will decide decisions governance.
