Soulbound Tokens (SBTs) are non-transferable blockchain tokens tied permanently to a “Soul” — a wallet or DID (Decentralized Identity) that represents an individual, organization, or entity. Coined by Vitalik Buterin, economist E. Glen Weyl, and Puja Ohlhaver in a May 2022 paper titled “Decentralized Society: Finding Web3’s Soul,” SBTs address a fundamental gap in Web3: blockchains are excellent at tracking financial value but terrible at tracking trust, credentials, and social relationships. SBTs could represent diplomas, professional certifications, membership records, reputation scores, and more.
The Problem SBTs Solve
Current crypto assets are all transferable. This has implications:
- No on-chain credentialing: A “verified doctor” or “Harvard graduate” badge is meaningless as an NFT — you can buy it on OpenSea
- Can’t prove reputation: Transaction history shows financial activity, not trustworthiness
- No social recovery without custodians: To recover a lost wallet, you need a centralized service; SBTs allow trusted individuals to collectively recover access
- Sybil resistance is hard: One identity = one wallet is unprovable without centralized verification
SBTs fix these by being non-transferable. If your medical degree SBT can’t be sold, bought, or moved, then holding it is meaningful evidence you earned it.
What SBTs Represent
| Use Case | SBT Example |
|---|---|
| Education | Harvard Medical School diploma (issued by Harvard’s Soul) |
| Professional | CFA charter, nursing license, bar admission |
| Employment | Past employment verified by employer Soul |
| DAO membership | Non-transferable governance participation record |
| Social | Community membership, event attendance |
| Credit history | Repayment track record on DeFi loans |
| KYC | “Over 18 verified” without revealing age or identity |
| Reputation | Trust scores from multiple communities |
The DeSoc Paper
The 2022 paper “Decentralized Society: Finding Web3’s Soul” (Buterin, Weyl, Ohlhaver) outlined a vision for “Decentralized Society” (DeSoc) using SBTs:
Souls: Wallets that hold SBTs — representing entities in the real world
Communities: Groups of Souls with shared SBTs
Key applications:
- Community wallet recovery: K-of-N friends/family can collectively recover a lost Soul via SBTs
- Sybil-resistant voting: One-person-one-vote requires unique identity; correlated SBTs can prove personhood
- Undercollateralized loans: Lend without full collateral to Souls with strong reputation SBTs
- Quadratic funding: Calculate funding contributions proportionally using soul membership graphs
- Proof of personhood: Verify “human” without revealing who you are
Technical Implementation
SBTs can be implemented several ways in EVM:
ERC-5192 (Minimal Soulbound NFT): Extends ERC-721 with a locked() function. When locked() returns true, the token cannot be transferred.
ERC-4973 (Account-Bound Tokens): Different model — tokens are “given” by one Soul to another and can be “taken back” (revoked). Not permanently locked; issuer controls lifecycle.
ERC-1155 + transfer restriction: Simple approach — standard multi-token contract with transfer functions that revert.
Privacy Concerns
SBT critics raise serious privacy issues:
- Permanent record: A non-transferable criminal record SBT could permanently brand someone — digital scarlet letter
- Data aggregation: Combining SBTs enables unprecedented surveillance (all credentials visible on-chain)
- Forced disclosure: If employers expect SBTs, workers may be pressured to share their full soul
- Discrimination: Health condition SBTs, relationship status, religion — all visible to on-chain observers
ZK-SBTs as solution: Zero-knowledge proofs allow proving you hold an SBT property (“I have a university degree”) without revealing which university or disclosing to whom. This is technically feasible but complicates implementation.
Real Implementations
- Gitcoin Passport: Stamps → credential-based sybil resistance for quadratic funding
- ENS (Ethereum Name Service): Non-transferable names possible in updated design
- Binance Account Bound (BAB): Binance’s KYC-linked SBT on BNB Chain (2022; first major exchange SBT)
- DeGods “Dead” SBTs: NFT project issued non-transferable records of historical NFT ownership
- Galxe: On-chain credential platform issuing achievement NFTs (transferable, but credential-nature)
Social Media Sentiment
SBTs generated enormous theoretical excitement when the DeSoc paper launched in 2022 — Vitalik’s endorsement guaranteed major attention. Practical adoption has been slow; the privacy challenges are significant and unsolved. “Permanent non-transferable tokens for reputation” is a compelling concept that requires social infrastructure (trusted issuers) that doesn’t yet exist at scale. ZK-credential approaches (like Worldcoin’s World ID) are the more actively developing adjacent space.
Last updated: 2026-04
Related Terms
Sources
Buterin, V., Weyl, E. G., & Ohlhaver, P. (2022). Decentralized Society: Finding Web3’s Soul. SSRN.
Weyl, E. G., Ohlhaver, P., & Buterin, V. (2022). Decentralized Society and Soulbound Tokens. Ethereum Research Forum.
Nakamura, G., et al. (2023). Soulbound Tokens: Analysing Possible Applications of Non-Transferable Tokens in the Ethereum Ecosystem. arXiv.
Dwork, C., & Naor, M. (2006). Differential Privacy. ICALP.
Goodwin, T. (2022). Digital Identity, Credentials, and Blockchain. World Bank Working Paper.