Simple Ledger Protocol (SLP), is a new token protocol invented to be used on the Bitcoin Cash blockchain. SLP token works on the distributed ledger technology and can be used for digitizing a number of real worlds and virtual assets. SLP tokens can be used for tokenization of company shares, gaming assets, real estate ownership, and many other physical assets.
SLP token protocol promises increased transparency, security, and immutability for any token created using the SLP consensus. The biggest advantage of SLP is that it is extremely easy to use and understand. All the transactions using the token is done on the blockchain, thus providing the users a sense of transparency and security.
The creators of the token say that they wanted to create a tokenization consensus which is not overly complicated as many other protocols in the decentralized space. Since its creation, various businesses of different sectors have used the protocol to create their own personalized tokens.
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Is SLP Token Similar to ERC-20 Token?
Among hundreds of tokenization protocols, ERC-20 is probably the most recognized one and most widely used. ERC-20 is an Ethereum network’s native tokenization protocol. While SLP is quite similar to the ERC-20 and even better on certain standards. SLP is a comparatively new protocol based on BCH blockchain.
People can use this protocol to create a token which can be issued to anyone, can be minted, traded or spent like any other cryptocurrency. The users might also add custom token behavior using bitcoin script programming language.
SLP can also come handy for creating non-fungible tokens (NFT) like the Ethereum’s ERC-721 standard. SLP based non-fungible token promises to store the metadata off the chain. Every non-fungible SLP token carries a unique static token identifier, this identifier also acts as the Genesis transaction ID for the token.
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How SLP Works?
SLP based tokens can be thought of as a transaction within the transaction. The reason being SLP transaction live within a special output known as OP_RETURN, this output is a part of the standard Bitcoin cash transaction on the blockchain.
Let us suppose X wants to send a certain amount of the SLP token, so X would send a minimal amount of BCH, and this transaction also contains the data of the SLP token transfer. Anyone can create their own personalized token using the Simple Ledger Protocol.
The issuer can generate the token with 1-time issuance which can guarantee a fixed supply, or alternatively, a token that has multiple issuance rounds. These rounds can continue indefinitely until the issuer decides to switch it off permanently, marking the end-of-minting capabilities for that token.
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Is SLP Token Robust Enough For Mass Adoption?
The SLP based token’s USP is its simple nature and that what makes it robust. However, the protocol is quite new and still in its beta phase, thus its advisable to use the protocol only for testing purposes as of now, and do not consider it for serious projects. There might be many bugs in the testing phase before a more refined and real-world usable version comes out.
Bitcoin Cash network has decided to look for long term goals and usability and thus they have moved towards a complete ecosystem allowing its network for Dapp hosting and tokenization.
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