In January 2022, Ethereum founder Vitalik Buterin tweeted a single word that changed the way we think about non-transferable tokens forever.
That word? Soulbound.
Picture this: a digital realm where your achievements, affiliations, and social interactions are securely represented by unique, non-transferable tokens. Sounds a bit like something out of a sci-fi movie, right?
But this is the promise of Soulbound Tokens (SBTs). They aim to transform how we connect and engage in decentralized communities, placing emphasis on social value over cold, hard cash.
In this article, we’ll dive into the world of SBTs, their historical roots, how they function, and the groundbreaking work being done by Ordict in this exciting field.
History of Soulbound Tokens
SBTs first emerged in May 2022 when Vitalik Buterin, E. Glen Weyl, and Puja Ohlhaver introduced them in their groundbreaking paper, “Decentralized Society: Finding Web3’s Soul.”
This concept aims to create a framework for a decentralized society (DeSoc) where community-driven networks can thrive.
Since then, numerous projects have jumped on the SBT bandwagon.
One of the first notable examples is Binance’s BAB token, which acts as a verification tool for users who have completed Binance’s KYC (Know Your Customer) process. It demonstrates how SBTs can effectively link digital identities with real-world validations.
Then there’s Whitechain, a platform that’s all about ushering in a new era of digitalization. They’ve developed the WB Soul Ecosystem as part of their journey into Web3.
This ecosystem includes WB Souls (your digital representation), Soul Attributes (changeable characteristics like your WBT holding level), and of course, Soulbound Tokens, which are non-transferable assets that stay put at the address they were minted to, serving as achievements, rewards, and event passes.
In another major advancement, Solana has introduced the Seeker Mobile Phone, marking the next step in its mobile evolution after the Saga. This launch features the integration of Soulbound Tokens — allowing users to access exclusive airdrops and rewards by verifying their on-chain identity.
But let’s not forget the best example out there: Ordict. They’re creating something even more powerful and versatile with their Soulbound Inscription Protocol on the Bitcoin network.
Ordict’s protocol enables businesses, educational institutions, gaming companies, and various other industries to issue verifiable credentials on the most secure and decentralized blockchain in existence — Bitcoin!
The Soulbound Inscription Protocol developed by Ordict is designed to be utilized across multiple sectors, including gaming, professional certifications, loyalty programs, and proof of expertise.
By using Bitcoin as its backbone, Ordict offers permanent and tamper-proof credentials that serve as proof of skill, achievement, and participation. These credentials are uniquely non-transferable, adding layers of authenticity and trust to digital verifications.
Why Build Soulbound Inscriptions on Bitcoin?
Before we dive into what Soulbound Tokens (SBTs) are, it’s essential to highlight why Ordict has chosen to develop its Soulbound Inscription Protocol.
Bitcoin has long been the gold standard of blockchain technology, known for its unparalleled security, decentralization, and staying power. However, with the advent of ordinal theory, Bitcoin’s functionality has expanded in exciting ways.
Ordinal theory introduced the concept of inscriptions, allowing for the permanent storage of data directly on the blockchain — something that was previously limited in scope on Bitcoin.
This advancement makes Bitcoin not only the most secure and decentralized platform but also one that supports fully on-chain digital artifacts.
By building the Soulbound Inscription Protocol (SIP) on Bitcoin, Ordict ensures that all data remains immutable and on-chain, which is crucial for the long-term preservation of verifiable credentials.
Unlike other blockchains that rely on off-chain data storage — introducing risks such as server dependencies — Bitcoin offers true decentralization, where the data stays on the chain forever.
What Is Soulbound Inscription?
The term “Soulbound” takes a page from the gaming universe — especially from World of Warcraft.
What does that mean, you ask?
In the game, certain items become permanently attached to players after completing specific quests.
In a similar vein, SBIs are designed to stick with their original holders, reinforcing the idea of earned achievements and social identity over mere financial wealth.
From a Web3 perspective, SBIs differ from traditional cryptocurrencies and NFTs by being intrinsically linked to “Souls,” which are unique wallet addresses crafted to establish provenance and reputation.
Ordict’s CEO, Varun Choudhary, put it quite simply in a recent interview.
https://x.com/i/spaces/1jMJgBlgDoeGL
He explained that in the GameFi sector, players are often motivated by earnings. However, once they sell their assets, their emotional connection to the game fades. Ordict shakes up this dynamic by ensuring that achievements remain eternally recorded on-chain through Soulbound Inscriptions.
This way, players can carry their past victories into new games, enhancing their gameplay experience while showcasing their accomplishments.
How Soulbound Inscriptions Work
While the concept of Soulbound has generated significant buzz, few projects have taken the leap, and none have ventured into Bitcoin — except for Ordict. So, how do these inscriptions work?
Let’s break it down.
The defining feature of SBTs is their non-transferability, which sets them apart from standard NFTs and cryptocurrencies. SBTs are issued and stored within Souls — wallets that hold these tokens as representations of achievements and affiliations.
Mechanics of SBTs
- Issuance and Storage: SBTs are issued by one Soul and stored in another, creating a network of trust and validation. For example, an educational institution could issue an SBT certifying a student’s graduation, permanently linking it to that student’s Soul
- Verification: The integrity of SBTs is upheld through blockchain technology. Once issued, these tokens cannot be altered or transferred, ensuring their authenticity and protecting against fraud. The immutability of the blockchain guarantees that the information tied to the SBT remains unchanged and publicly verifiable
This powerful framework allows credentials to be easily verified, facilitating seamless interactions across various sectors, from education to finance.
Use Cases of Soulbound Tokens
The potential applications of SBTs are as vast as your imagination. Here are some compelling use cases:
- Gaming: Ordict is leading the charge in revolutionizing the gaming industry with Soulbound Inscriptions, providing players with verifiable in-game achievements that can’t be traded or sold. Imagine finishing a grueling quest and earning a unique SBI that showcases your accomplishment, enhancing your in-game identity and making those victories genuinely yours
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- Education: Educational institutions can leverage SBIs to issue verifiable, non-transferable digital certifications, allowing students to display their skills and achievements with absolute confidence. Picture a world where your degree is not just a paper certificate but a secure, blockchain-verified credential that guarantees the authenticity of your qualifications
- Loyalty Programs: Businesses can create verifiable loyalty programs using Soulbound Inscriptions, rewarding customers with non-transferable tokens as a testament to their ongoing patronage. Imagine earning exclusive rewards based on your loyalty, all tracked securely on the blockchain
- KYC and Credit Scoring: SBIs offer innovative solutions for Know Your Customer (KYC) and credit scoring by securely verifying user identities while protecting privacy. Financial institutions can implement SBIs to build transparent credit scoring mechanisms, allowing borrowers to present their credit history as a collection of verifiable credentials — demonstrating reliability without compromising personal information
- Proof of Attendance: SBIs can serve as proof of attendance for events and conferences, allowing participants to showcase their involvement in various communities. For instance, picture yourself attending a blockchain summit and receiving an SBI certifying your participation, proudly displayed on your professional profiles
Future of Soulbound Tokens
Recently, Donald Trump and his team announced their own crypto venture — World Liberty Financial — making waves in the blockchain space.
Interestingly, the venture’s token, WLFI, is a Soulbound Token that will be utilized for the firm’s governance.
This move highlights how even high-profile personalities and major corporations are beginning to embrace soulbound technology.
It’s becoming clear that big brands and organizations see tremendous potential in this innovative approach to digital assets.
The future of SBTs is undeniably bright — In the future, Ordict plans to enhance its capabilities by adopting established inter-blockchain communication protocols and rollup services. This will enable multichain operations and widening the spectrum of possibilities for Soulbound Inscriptions.
