NFTs are probably not that new to you. I mean everybody is talking about those JPEGs. Some even sold for millions of dollars. Anyways, post the rise of Non Fungible Tokens, we got to Soulbound Tokens aka SBTs.

Like NFTs, these things have a place in the concept of digital ownership. And in this article, we are gonna talk what these tokens can do, and how they are being used.


To get into SBTs, let’s understand what NFTs are on a basic level.

NFTs, which stands for Non-Fungible Tokens, are like digital certificates that say, “Hey, this thing is uniquely mine!”

Imagine you have a special sticker on your favorite toy that proves it’s yours and yours alone – that’s kind of what NFTs do for digital stuff.

It’s not just art! NFTs are also wiggling their way into the world of gaming. You know those super-rare items you score in video games? With NFTs, they become even more special. They can’t be copied or duplicated, which makes them as unique as your gaming skills. And they are being used in real life too, not just for the sake of digital world.

Now, let’s talk digital ownership. In the physical world, owning something means you can hold it, show it off, or even sell it to someone else.

With NFTs, you can own digital items just like you own a real-world treasure. It’s like getting the bragging rights and a digital key that proves it’s legitimately yours. And this matters because it opens up a whole new door of possibilities. All thanks to the Blockchain Technology and Smart Contracts.

Soulbound Tokens

Soulbound Tokens are nothing but non-transferrable NFTs. And that means you can’t just transfer it or sell it anyone once you have it in your wallet, unlike any other NFT.

SBTs are described as non-transferable digital tokens that represent social identity in a decentralized society in the paper ‘Decentralized Society: Finding Web3’s Soul‘.

BTW, from where do you think it got the name Soulbound?? It came from the concept of ‘Soulbound Items’ in the World of Warcraft game. And all thanks to Vitalik Buterin for the name, who was the first person to bring the idea of SBTs, via his blog post.

How Does SBTs Work

The entity’s wallet that issues these non-transferrable tokens are called ‘Souls’.

A ‘Soul’ can be a college that issues certificates as SBTs to its student, directly in their wallet addresses. Or a company that issues work experience certificates to their employees.

SBTs are issued by and stored within Souls and they are mainly utilized to establish provenance and reputation.

Unlike NFTs, SBTs hold zero monetary value as they cannot be traded once issued to someone’s wallet.

So what we need to understand here is that NFTs act as digital ownership certificate to something (a piece of art, an mp3 file, etc) that can be traded or showed off to other people (as status symbol).

Whereas an SBT is something that will be assigned to your wallet, permanently, and not trade it. It is basically a permanent certificate.

Use Cases Of SBTs

Soulbound tokens can be a pretty good use case for medical records, education details, work history, and any type of information that makes up a person or entity. Let’s look in detail, how they can be helpful.


We can say goodbye to Fake Degrees. You know those fancy certificates (that probably might have never helped you in your career) you get when you graduate from school or university?

Well, SBTs can make them even cooler. Instead of paper certificates that can be copied or faked, SBTs are like digital certificates with a superpower – they can’t be forged.

Imagine using SBTs to prove your attendance. When a school or college issues you an SBT that contains all your academic achievements and confirms that you’ve been a dedicated student.


Imagine you’re applying for college or a job. Instead of lugging around tons of papers and documents, you simply whip out your trusty SBTs. These tokens hold all your achievements and educational history. It’s like having your entire academic journey neatly packaged in your pocket.

Now, colleges or employers can easily see your skills, your projects, your achievements – all verified and secure through SBTs.


SBTs in healthcare mean seamless transitions. They cut through the red tape, making it easier and faster for you to get the care you need. How?

Imagine this scenario: You’ve decided to switch doctors because you’ve moved or just want a fresh perspective. With an SBT, all your medical history is right there, securely stored. No more digging through old files or calling your previous doctor to get records sent over. It’s all in your SBT.

You stroll into your new doctor’s office, and they ask for your medical history. Instead of fumbling with papers or trying to remember the last time you had a tetanus shot, you simply grant access to your SBT. It’s like giving your new doctor a backstage pass to your health journey.


SBTs does an amazing job when it comes to the secure verification of users affiliation and prove the membership status.

Louis Vuitton, the big-shot in luxury fashion, dropped an NFT collection called ‘Treasure Trunks collection’. And they’ve used SBTs to make it extra exclusive.

As it’s an SBT, you can’t just flip the whole trunk for a quick buck. However, you do have some room to play. You can sell individual items from your trunk that you’ve turned into NFTs. So, it’s like saying, “Hey, this diamond-studded necklace in my trunk? Yeah, you can buy it from me.”

So, the exclusivity comes from the fact that these trunks can’t be easily passed around or resold as a whole.

They stay tightly connected to their owners, making them super rare. It’s like owning a limited-edition item that only a select few can have. This rarity and uniqueness enhance the value of what’s inside – the fashion pieces in this case.

Digital Identity

No more fumbling through a stack of physical cards. SBTs let you carry your ID and memberships in your pocket. Show that you’re a gym member, library cardholder, or part of an exclusive club with just a tap on your phone.

SBTs let you build a reputation online, just like you do in the real world. Whether you’re paying back loans, earning trust in DeFi (that’s decentralized finance), or participating in DAOs (those are fancy self-governing groups), SBTs help you show you’re the real deal.


From schooling to job-hunting, healthcare to fashion, SBTs are simplifying it all. They’re adding a dash of trust and uniqueness to our digital existence.

With SBTs by our side, I believe the future will be a whole lot more secure, trustworthy, and connected in the digital realm.