What are Soulbound Tokens (SBTs) and Souls? Why do they matter?
Vitalik Buterin proposed a non-transferable token dubbed Soulbound Token to enable a web3 user identity system. Web3 has made impressive progress over the past few years, but the absence of a reliable identity system prevents its mass adoption. In a co-authored paper, Vitalik Buterin discussed the “Soul” of web3 and how to build a decentralized society through Soulbound Tokens.
- The paper titled Decentralized Society: Finding Web3’s Soul introduced a non-transferable token that can be utilized to form the social credit system of web3.
- You could see a Soulbound token as a non-transferable, personal NFT.
- The lack of identity in web3 has led to many issues, including heavy dependence on web2 infrastructure and crypto crimes.
- Soulbound tokens can be used to reduce NFT forgery, enable undercollateralized lending, help DAOs mitigate Sybil attacks, etc.
- Ultimately the SBT concept could make your passport,…