🟣 Shopify, Stripe & Visa Can Build on Solana Now
Token Extensions Explained
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GM DOers!
Do you know the main reason behind why enterprises are not building in web3 today?
👉 Control.
One thing that big companies demand today in order to function and profit is control over their operations, money and data.
If they were to build in web3 today, using a public blockchain like Solana or Ethereum, these things would all become transparent.
Enterprises would therefore lose control. They don’t want that.
Instead, they need privacy, security and, most importantly, compliance.
Well, Solana Labs might just be able to offer all of these things with their new token standard called ‘Token Extensions’.
This is a new feature built into the protocol, that allows for the creation of customized tokens.
Now, companies and enterprises can launch tokens that are tailored to their unique requirements, enhancing functionality, security and utility.
This feature has the potential to attract big businesses like Visa, Shopify and Stripe to Solana.
Let me tell you why. ⏬
At its core, Solana's token extensions are advanced features that can be added to Solana tokens.
The extensions are like customizable options or tools that developers can use to tailor the tokens to specific needs or functionalities.
Imagine you're creating a customizable toy car.
The basic model can roll and turn, but with extra kits (extensions), you can add features like remote control, special lights, or even a mechanism to make it fly short distances.
In Solana's case, these "kits" are the token extensions, and the toy car is the digital token.
These extensions enable tokens to have more complex behaviors and properties than just being sent and received.
Here are a few concrete examples of how Token Extension can be used by Visa, Shopify, Stripe, Netflix, Adobe, Bank of America, and EA. ⏬
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Confidential Transfers: Keep transaction details and balances private, great for secure payments and for companies paying employees, since this uses zero knowledge technology.
👉 Visa can use this feature for private, automated cross-border payments, streamlining B2B transactions, recurring subscriptions and employee remuneration with enhanced privacy.
Transfer Hooks: Manage how tokens move and who can use them, useful for verifying users and managing royalties.
👉 Shopify can use this feature to automate KYC for merchants and attribute digital products to creators, ensuring authenticity and automating royalty payments in their ecommerce ecosystem.
Transfer Fees: Add fees to transactions, good for ongoing royalties or service charges.
👉 Stripe can use this feature to introduce new revenue through transaction fees and issue secure digital certificates or licenses that cannot be transferred, enhancing security and exclusivity.
Permanent Delegation: Give certain programs lasting control over tokens, helps with subscriptions and legal compliance.
👉 Netflix can use this feature to automate monthly subscription fees, allowing a designated program to handle payments seamlessly, ensuring uninterrupted service access and adherence to automatic billing cycles.
Metadata Pointer: Connect tokens with additional information for checking authenticity and ownership.
👉 Adobe can use this feature to authenticate software licenses and user subscriptions, linking digital tokens to user accounts for verifying ownership and usage rights.
Default Account State: Set rules for how token accounts work to boost security.
👉 Bank of America can use this feature for enhanced security in digital banking transactions, setting strict rules on token accounts to prevent unauthorized access and ensuring compliance with financial regulations.
Non-Transferrable Tokens: Make tokens that can't be passed on, except by the creator, for special kinds of digital items or rights.
👉Electronic Arts (EA) can use this feature for exclusive in-game items or memberships that cannot be traded, ensuring that special rights or digital assets remain with the original purchaser or are only accessible through official channels.
I'm confident in Solana's approach and success for a few key reasons:
Their control over the entire system lets them move quickly and in sync.
Their skilled business team is great at building partnerships with big names like Visa and Shopify, showing they know how to work with top companies.
Their tech team is really good at making and releasing new features that solve real problems.
Solana is using these strengths to stand out amongst other blockchains.
Another interesting thing that Solana does extremely well is marketing.
If you haven’t watched Solana’s presentation video of Token Extensions, I recommend you watch it below.
It's awesome how they make easy-to-understand, high-quality videos about their blockchain updates.
This is a smart way to get developers and businesses interested – something that the Ethereum Foundation lacks for example.
If we want more people to get into blockchain, we need clear explanations and good marketing, and Solana is nailing it.
The next big step for Solana is for a well-known company, like Shopify, to start using Solana's token extensions.
If Solana can show how much money Shopify saves—since Solana's transactions are cheaper than credit card fees—it would prove Solana's value big time.
If you’d like to dive deeper into Solana, and understand why it’s such an exciting investment, then I recommend you read 3 of our recent onchain reports.
Tokenomics Report on Solana – understand how the token accrues value
Price Predictions Report – based on previous cycles, how high can $SOL go this time around?
Is Solana the Next Big Thing? – a ‘state of Solana’ report, analyzing various onchain metrics.
Thanks for reading. And remember, you're strong, you’re powerful, you’re alpha! ❤️
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Disclaimer: This article is for informational purposes only and not financial advice. Conduct your own research and consult a financial advisor before making investment decisions or taking any action based on the content.
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