Solana is revolutionizing the functionality of its token, granting developers more control through customizable ownership and usage rules.
The Solana Foundation recently unveiled the activation of “token extensions” on Solana’s SPL token standard, a project formerly known as Token-2022, which has been in development for over a year.
The primary goal of these token extensions is to enhance compliance capabilities for entities creating tokens on the Solana network. By embedding specific functionalities directly into their tokens, businesses can now enjoy features like whitelisting, automatic transaction fees, and confidential transfer mechanisms, representing a significant upgrade from previous options.
Solana’s extensions are available in two main forms: mint and account extensions. The platform has introduced a range of mint extensions that are currently accessible for use.
These include features like confidential transfers, which protect the privacy of transaction amounts, interest-accruing tokens, and transfer hooks. Transfer hooks work by triggering a program to validate token transfers, enabling the revocation of transfers that do not meet the specified criteria. These innovative mint extensions now offer a variety of new functionalities on Solana.
The update is particularly beneficial for stablecoin issuers, as highlighted by the Solana Foundation. Leading crypto service providers such as Paxos and GMO-Z.com Trust Company, a New York-based issuer of Yen and USD-pegged stablecoins, have already integrated Solana’s new token extensions into their stablecoin operations on the platform.
In response to this announcement, the market price of SOL has experienced a positive reaction, with the altcoin seeing an increase of nearly 6% in the past 24 hours.