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Solana Reveals Major Network Development
- Solana (SOL) price jumps 6% amid broader market slump, fuelled by announcement of token extensions.
- Token extensions are a new feature set to enhance Solana token functionality for developers.
- There are five key extensions, including confidential transfers and permanent delegate authority.
- The extensions will be particularly useful for stablecoin issuers and other real-world businesses/governments joining the crypto scene.
Solana (SOL) has bucked the overall market trend in the past 24 hours, jumping nearly 6% amid middling performance from most other coins in the top-10 market cap. The catalyst for this resurgence was the announcement of “token extensions” a new feature on the Solana blockchain set to deliver a swathe of new possibilities for app developers.
What are Token Extensions?
Token extensions have been in the works for over a year now, with development kicking off in the tail-end of 2022. The upgrade, originally called Token-2022, is a significant enhancement of the current Solana token standard, SPL.
Much of the token extensions’ ideology revolves around compliance, specifically, delivering new options for compliance to businesses building on Solana’s network. This is made possible by adding new permutations for who can hold certain SPL tokens, and how holders can store/transact them.
The five extensions are:
- Transfer hooks: Programs that check if the transaction is permissible or not.
- Confidential transfers: Users can hide transaction details like the amount being sent – but actual wallet addresses cannot be made anonymous.
- Transfer fees: Enforceable fees (like royalties) on specific token transfers.
- Non-transferability: Disable token holders from sending assets between wallets.
- Permanent delegate authority: Token issuers retain complete control over the tokens, including the ability to cancel them or move them regardless of ownership.
While this level of control sounds bad from a broader crypto perspective, it can be especially useful for bringing in government or business to the Solana ecosystem.
In practice, this might introduce features such as whitelisting, anonymous transfers and automatic transaction fees – elements that were previously unable to be coded into SPL tokens. The extensions may particularly benefit stablecoin issuers, who in exchange for seeing greater real-world adoption, must abide by a constantly evolving regulatory environment.
Author
Ben Knight
Ben Knight is a writer and editor from Melbourne with a passion for all things music and finance. He enjoys turning complex topics – especially the technical details of cryptocurrency – into digestible bites that anybody can understand. He acquired his Master’s in Writing, Editing and Publishing from RMIT in 2019 and has run his own creative writing business ever since.
