- Ethereum co-founder Vitalik Buterin has written a partially lengthy paper on “tokens,” or SBTs.
- They are non-transferable NFTs that he says can strengthen people’s social identities to fight fraud.
- Colleges can issue certificates via SBTs, and event organizers can verify a person’s attendance.
Get ready for a new buzzword to take over the coding space.
Vitalik Buterin, co-founder of Ethereum, co-wrote a 37-page paper this month outlining how the future of Ethereum will focus on an ecosystem called the decentralized community.
A key aspect of this theoretical future is “soul tokens”, which It will be available for use later this year. (Yes, it’s possible that the name derives from World of Warcraft’s “Spirit-Guaranteed Items,” which Buterin previously praised.)
SBTs are non-fungible tokens (NFTs) that anyone can earn based in part on their job and educational history. Unlike regular NFTs, they are not transferable (although people can revoke them if they choose). SBTs may represent a person’s reputation and achievements, a kind of “extended biography,” Buterin wrote.
The idea is to enhance people’s social identities by assigning them unique, non-interchangeable badges. In theory, tokens could help solve some of the problems plaguing decentralized finance, such as scams and theft.
Undergraduate degrees and “templates”
There are several ways we can use these symbols in real life, according to the paper.
Suppose universities start issuing certificates as spirit-bound tokens, or employers start awarding SBT certificates to workers, or event organizers distribute SBT certificates to attendees, such credentials could make it harder for scammers to impersonate someone, and make it easier for potential employers to verify of history or training when considering employment. .
Tokens can help decentralized autonomous organizations, or groups without a hierarchy or individual leader, to more easily recall members for an event or cause. For example, a DAO who cares about the environment, could airdrop SBTs on people who already have environmental SBTs in place as a recruiting tactic. Buterin called these types “moulds.”
Someone’s SBTs will then be validated by other “souls,” or people who can vouch for you and the credential or achievement that you earn a token for, similar to how a LinkedIn connection can verify your skill. All of these will be stored in a “soul” wallet on the blockchain, unlike the software wallets used in crypto and NFTs today.
So what’s the point?
According to Buterin and his co-authors, SBTs specifically can help move Web3 forward by reducing reliance on central companies and giving people more ownership of their digital selves.
NFT artists are often forced to rely on centralized places like Twitter or OpenSea to sell their work, the paper says, and many crypto users rely on software wallets controlled by companies like Coinbase rather than truly decentralized wallets.
SBTs can also help distribute some of the wealth-obsessed aspects of crypto culture that have infringed on what enthusiasts say is a truly decentralized movement.
For example, NFTs are transferable and whoever owns them can sell them to others. For example, if colleges offered degrees in the form of NFTs, they could theoretically also sell them online to people who didn’t attend college and completed their programs.
In theory, this risk is mitigated with SBTs – it will be difficult for people to buy their niche and achievements.
As Buterin wrote in his January article discussing World of Warcraft’s soul-specific items, “Making more items in the ‘guaranteed’ crypto space could be one path toward an alternative, where NFTs can represent much of your identity and not just what you can afford.” “