The Solana blockchain has introduced a new standard called “token extensions” to expand the capabilities of tokens issued on Solana’s native SPL standard. These extensions will enable more complex functionality for tokens comparable to Ethereum’s ERC-20 tokens.
As announced on January 24, the extensions cater to developers across industries like payments, stablecoins, and real-world assets. They provide advanced controls similar to blockchains while leveraging Solana’s strengths like speed and low transaction costs.
Potential features include transfer hooks for intricate token mechanics, transfer fees to charge on swaps, confidential transfers using zero-knowledge proofs, permanent authorities that can revoke tokens, and non-transferable tokens for credentials.
The goal is to make it easier for enterprises to adopt blockchain technology by streamlining security, compliance, and other needs. Token extensions give businesses flexible tools to transition business logic on-chain while meeting their standards.
Early adopters like Paxos and Japanese company GMO-Z.com Trust are using extensions to launch stablecoins on Solana. As a regulated platform, Paxos can innovate while staying compliant. Extensions allow balancing regulation with experimentation.
According to Solana Foundation’s Head of Payments Sheraz Shere, enterprises are choosing Solana for its performance. With token extensions solving needs around compliance, Solana aims for more enterprise adoption and mainstream blockchain usage. The new functionality cements Solana as a versatile blockchain for applications.
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