Non-Transferability describes a characteristic of certain digital assets or tokens that prevents them from being moved or sold from one holder to another. This restriction is often programmed into the asset’s smart contract or imposed by regulatory requirements. Tokens designed for specific purposes, such as identity verification or voting rights within a particular system, may exhibit non-transferability. This feature can enhance security or ensure the integrity of certain applications by limiting secondary market activity.
Context
The concept of non-transferability is gaining relevance in digital asset design, particularly for soulbound tokens or credentials that are tied to a specific individual or entity. While promoting unique use cases for identity and reputation on blockchains, it also presents challenges regarding liquidity and the potential for creating walled gardens within the decentralized ecosystem. Discussions center on the trade-offs between utility, security, and market dynamics for such restricted assets.
The Blockchain Designated Verifier Proof (BDVP) uses a verifier-held trapdoor to simulate fake proofs, restoring non-transferable privacy to ZKPs on public chains.
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