Simple Ledger Protocol (SLP)

The most important thing you need to know is that with SLP, version 1, tokens can be easily destroyed if they are held by, or transferred to, a non-SLP wallet.  Non-SLP wallets will not correctly interpret the SLP metadata and would treat the token as vanilla Bitcoin Cash, resulting in a burned token.

You should not use a non-SLP wallet that has tokens on it. If you do this, the non-SLP wallet may end up spending the coin (the UTXO) that contains the tokens.  For example, with the Electron Cash SLP Edition wallet, once you have tokens on a wallet file, only open that wallet file with the Electron Cash SLP Edition wallet.  Other versions of Electron Cash may unwittingly burn the tokens held by that wallet file.  This applies not just to wallet files per se, but also wallets that you restore from seed, as they will contain a particular set of addresses and coins.

For more information read this article:  The Why and How for SLP Token Wallets.

We hope to address this issue with SLP version 2, as it would greatly improve the user experience and expand the range of potential applications, since tokens could be sent to any Bitcoin Cash address without needing to know whether or not the receiving wallet was SLP compatible.

We became motivated to create SLP because we believed most previous token proposals were overcomplicated. We wanted something simple and easy to use.

Try the Electron Cash SLP desktop wallet, the Mint web wallet, or the Bitcoin.com wallet.  Ask your friends to send you tokens, or mint your own.

In many ways, yes. Anyone can issue, or “mint” a new token type. Tokens can be traded, spent, or given to someone else. They operate in a distributed manner like most cryptocurrencies. Custom token behavior can be added using bitcoin Script programming language in novel ways.

SLP also offers good support for non fungible tokens (NFT). Like Ethereum’s ERC-721 standard, meta data for each token can be stored off-chain. Each non fungible token in SLP can have a unique, static token identifier which is also the genesis transaction id. All NFT tokens for a project can be issued from the same address for easy classification.

You can think of SLP as a ‘transaction within a transaction’. SLP transactions live within a special output known as OP_RETURN, which is a part of a standard Bitcoin Cash transaction. If Alice wants to send Bob some tokens, she sends a minimal (dust) amount of BCH, and the transaction also contains the data to transfer the tokens. You may be interested in reading the protocol specification, which is comprehendable to the average Bitcoin-minded reader.

Yes, simply download the Electron Cash wallet to create new tokens.

You should carefully review all of the available protocols on Bitcoin Cash for tokens. Some may be more suited to your purpose than others. We have listed many of the benefits of SLP above.

Token creators can generate a token with a 1-time issuance, thus guaranteeing 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.

Token issuance authority can also be delegated to someone else after the token has already been created.

The initial genesis minting of a token is also a Bitcoin Cash transaction. The BCH transaction Id is then one and the same with the hash Id of the token.

Token issuers can also specify a name for their token within the data. However, there are no reserved names. Names can be duplicated, sometimes maliciously. (This is also true of ERC-20). Therefore, users should always check the hash Id against a trusted source.

The Bitcoin protocol deals directly with smallest granular units, which are called satoshis, but amounts in wallets are often expressed in decimal format (i.e. 3.0723432 BCH). A similar system is used in SLP; the protocol itself deals with integer units, but some tokens are better displayed with decimals. The genesis mint of a transaction can set a decimal preference if desired.

Yes. “SLP Addr” is a new encoding for addresses, similar to CashAddr. Theoretically, tokens could be sent and received from any address format, but we strongly encourage wallet implementations to use SLP Addr format. This helps prevent user mistakes when transacting in either Bitcoin Cash or tokens.

The SLP protocol is simple, which makes it robust.  The protocol simplicity makes it easy for new wallet software builders to pass the protocol unit tests and achieve perfect SLP compliance.

SLP is a simple platform to keep track of anything quantifiable, sort of like a public and immutable spreadsheet on a blockchain.  What could possibly be the risk of that?  Using the SLP wallet software recommended on this site will prevent any accidental loss of your tokens.