Non-Transferable Token - Nexis Network Docs

Summary

In the original Token Program, creating non-transferrable (sometimes called “soul-bound”) tokens is impossible
The Token Extension Program’s non-transferrable token enables non-transferrable tokens

Overview

In the Token Program, it’s impossible to create a token that cannot be transferred away. While this may seem unimportant, there are several reasons one may want to issue a non-transferrable (or “soul-bound”) token. Take the following example: Say you are a Nexis Native Chain game dev, and your new game, “Bits and Bytes”, wants to award achievements to the players. Achievements are not transferrable, and you want their hard work to be proudly displayed in their wallet. The solution is to send them a non-transferable NFT. However, in the Token Program, this is not possible. However, it is in the Token Extension Program! Enter, the non-transferable extension. Token Extension Program has the non-transferable extension which can be used to create non-transferable mints. These mints can be burned, but they can’t be transferred.

Creating non-transferable mint account

Initializing a non-transferable mint involves three instruction:

SystemProgram.createAccount
createInitializeNonTransferableMintInstruction
createInitializeMintInstruction

The first instruction SystemProgram.createAccount allocates space on the blockchain for the mint account. This instruction accomplishes three things:

Allocates space
Transfers lamports for rent
Assigns to itself it’s owning program

Like all other extensions, you’ll need to calculate the space and lamports needed for the mint account. You can do this by calling: getMintLen and getMinimumBalanceForRentExemption.

const extensions = [ExtensionType.NonTransferable];
const mintLength = getMintLen(extensions);

const mintLamports =
  await connection.getMinimumBalanceForRentExemption(mintLength);

const createAccountInstruction = SystemProgram.createAccount({
  fromPubkey: payer.publicKey,
  newAccountPubkey: mintKeypair.publicKey,
  space: mintLength,
  lamports: mintLamports,
  programId: TOKEN_2022_PROGRAM_ID,
});

The second instruction createInitializeNonTransferableMintInstruction initializes the non-transferable extension.

const initializeNonTransferableMintInstruction =
  createInitializeNonTransferableMintInstruction(
    mintKeypair.publicKey,
    TOKEN_2022_PROGRAM_ID,
  );

The third instruction createInitializeMintInstruction initializes the mint.

const initializeMintInstruction = createInitializeMintInstruction(
  mintKeypair.publicKey,
  decimals,
  payer.publicKey,
  null, // Confirmation Config
  TOKEN_2022_PROGRAM_ID,
);

Lastly, add all of the instructions to a transaction and send to Nexis Native Chain.

const mintTransaction = new Transaction().add(
  createAccountInstruction,
  initializeNonTransferableMintInstruction,
  initializeMintInstruction,
);

await sendAndConfirmTransaction(
  connection,
  mintTransaction,
  [payer, mintKeypair],
  { commitment: "finalized" },
);

And that’s it! You now have a mint account, that when minted, cannot be transferred. This extension gets more exciting when you mix it with the metadata and metadata-pointer extensions to create soul-bound NFTs.

Lab

In this lab, we will create a non-transferable token and then see what happens when we try to transfer it (hint: it will fail the transfer).

1. Getting started

To get started, create an empty directory named non-transferable-token and navigate to it. We’ll be initializing a brand new project. Run npm init and follow through the prompts. Next, we’ll need to add our dependencies. Run the following to install the required packages:

npm i @nexis-network-developers/helpers @nexis-network/spl-token @nexis-network/web3.js esrun dotenv typescript

Create a directory named src. In this directory, create a file named index.ts. This is where we will run checks against the rules of this extension. Paste the following code in index.ts:

import { Connection, Keypair } from "@nexis-network/web3.js";
import { initializeKeypair } from "@nexis-network-developers/helpers";
import dotenv from "dotenv";
import {
  createAccount,
  mintTo,
  TOKEN_2022_PROGRAM_ID,
} from "@nexis-network/spl-token";
// import { createNonTransferableMint } from './create-mint';
dotenv.config();

/**
 * Create a connection and initialize a keypair if one doesn't already exists.
 * If a keypair exists, airdrop a sol if needed.
 */
const connection = new Connection("http://127.0.0.1:8899", "confirmed");
const payer = await initializeKeypair(connection);

console.log(`public key: ${payer.publicKey.toBase58()}`);

const mintKeypair = Keypair.generate();
const mint = mintKeypair.publicKey;
console.log("\nmint public key: " + mintKeypair.publicKey.toBase58() + "\n\n");

// CREATE MINT

// CREATE SOURCE ACCOUNT AND MINT TOKEN

// CREATE DESTINATION ACCOUNT FOR TRANSFER

// TRY TRANSFER

This file has a main function that creates a connection to the specified validator node and calls initializeKeypair. This main function is where we’ll end up calling the rest of our script once we’ve written it. Go ahead and run the script. You should see the mint public key logged to your terminal.

esrun src/index.ts

If you run into an error in initializeKeypair with airdropping, follow the next step.

2. Setting up dev environment (optional)

If you are having issues with airdropping devnet NZT. You can either:

Add the keypairPath parameter to initializeKeypair and get some devnet NZT from Nexis Native Chain’s faucet.
Run a local validator by doing the following:

In a separate terminal, run the following command: solana-test-validator. This will run the node and also log out some keys and values. The value we need to retrieve and use in our connection is the JSON RPC URL, which in this case is http://127.0.0.1:8899. We then use that in the connection to specify to use the local RPC URL.

const connection = new Connection("http://127.0.0.1:8899", "confirmed");

3. Create a non-transferable mint

Let’s create the function createNonTransferableMint in a new file src/create-mint.ts. Inside the file, create the function createNonTransferableMint with the following arguments:

connection : The connection object
payer : Payer for the transaction
mintKeypair : Keypair for new mint
decimals : Mint decimals

Inside the function, we’ll call the following:

getMintLen - to get the space needed for the mint account
getMinimumBalanceForRentExemption - to get the amount of lamports needed for the mint account
createAccount - Allocates space on the blockchain for the mint account
createInitializeNonTransferableMintInstruction - initializes the extension
createInitializeMintInstruction - initializes the mint
sendAndConfirmTransaction - sends the transaction to the blockchain

import {
  sendAndConfirmTransaction,
  Connection,
  Keypair,
  SystemProgram,
  Transaction,
  TransactionSignature,
} from "@nexis-network/web3.js";

import {
  ExtensionType,
  createInitializeMintInstruction,
  getMintLen,
  TOKEN_2022_PROGRAM_ID,
  createInitializeNonTransferableMintInstruction,
} from "@nexis-network/spl-token";

export async function createNonTransferableMint(
  connection: Connection,
  payer: Keypair,
  mintKeypair: Keypair,
  decimals: number,
): Promise<TransactionSignature> {
  const extensions = [ExtensionType.NonTransferable];
  const mintLength = getMintLen(extensions);

  const mintLamports =
    await connection.getMinimumBalanceForRentExemption(mintLength);

  console.log("Creating a transaction with non-transferable instruction...");
  const mintTransaction = new Transaction().add(
    SystemProgram.createAccount({
      fromPubkey: payer.publicKey,
      newAccountPubkey: mintKeypair.publicKey,
      space: mintLength,
      lamports: mintLamports,
      programId: TOKEN_2022_PROGRAM_ID,
    }),
    createInitializeNonTransferableMintInstruction(
      mintKeypair.publicKey,
      TOKEN_2022_PROGRAM_ID,
    ),
    createInitializeMintInstruction(
      mintKeypair.publicKey,
      decimals,
      payer.publicKey,
      null,
      TOKEN_2022_PROGRAM_ID,
    ),
  );

  const signature = await sendAndConfirmTransaction(
    connection,
    mintTransaction,
    [payer, mintKeypair],
    { commitment: "finalized" },
  );

  return signature;
}

Now let’s invoke this function in src/index.ts to create the non-transferable mint:

// CREATE MINT
const decimals = 9;

await createNonTransferableMint(connection, payer, mintKeypair, decimals);

The script should run with no errors

esrun src/index.ts

The non-transferable mint has been set up correctly and will be created when we run npm start. Let’s move on to the next step and create a source account and mint a token to it.

4. Mint token

Let’s test that we can’t actually transfer tokens created from this mint. To do this, we need to mint a token to an account. Let’s do this in src/index.ts. Let’s create a source account and mint one non-transferable token. We can accomplish this in two functions:

getOrCreateAssociatedTokenAccount: from the @nexis-network/spl-token library, this creates an associated token account (ATA) for the given mint and owner.
mintTo: This function will mint an amount of tokens to the given token account.

// CREATE PAYER ATA AND MINT TOKEN
console.log("Creating an Associated Token Account...");
const ata = (
  await getOrCreateAssociatedTokenAccount(
    connection,
    payer,
    mint,
    payer.publicKey,
    undefined,
    undefined,
    undefined,
    TOKEN_2022_PROGRAM_ID,
  )
).address;

console.log("Minting 1 token...");

const amount = 1 * 10 ** decimals;
await mintTo(
  connection,
  payer,
  mint,
  ata,
  payer,
  amount,
  [payer],
  { commitment: "finalized" },
  TOKEN_2022_PROGRAM_ID,
);
const tokenBalance = await connection.getTokenAccountBalance(ata, "finalized");

console.log(
  `Account ${ata.toBase58()} now has ${tokenBalance.value.uiAmount} token.`,
);

Run the script and confirm a token has been minted to an account:

esrun src/index.ts

5. Attempt to transfer a non-transferable token

Lastly, let’s try and actually transfer the token somewhere else. First we need to create a token account to transfer to, and then we want to try and transfer. In src/index.ts, we will create a destination account and try to transfer the non-transferable token to this account. We can accomplish this in two functions:

createAccount: This will create a token account for a given mint and the keypair of said account. So instead of using an ATA here, let’s generate a new keypair as the token account. We’re doing this just to show different options of accounts.
transferChecked: This will attempt to transfer the token.

First, the createAccount function:

// CREATE DESTINATION ACCOUNT FOR TRANSFER
console.log("Creating a destination account...\n\n");
const destinationKeypair = Keypair.generate();
const destinationAccount = await createAccount(
  connection,
  payer,
  mintKeypair.publicKey,
  destinationKeypair.publicKey,
  undefined,
  { commitment: "finalized" },
  TOKEN_2022_PROGRAM_ID,
);

Now, the transferChecked function:

// TRY TRANSFER
console.log("Attempting to transfer non-transferable mint...");
try {
  const signature = await transferChecked(
    connection,
    payer,
    ata,
    mint,
    destinationAccount,
    ata,
    amount,
    decimals,
    [destinationKeypair],
    { commitment: "finalized" },
    TOKEN_2022_PROGRAM_ID,
  );
} catch (e) {
  console.log(
    "This transfer is failing because the mint is non-transferable. Check out the program logs: ",
    (e as any).logs,
    "\n\n",
  );
}

Now let’s run everything and see what happens:

esrun src/index.ts

You should get an error message at the very end that says Transfer is disabled for this mint. This is indicating that the token we are attempting to transfer is in fact non-transferable!

Attempting to transfer non-transferable mint...
This transfer is failing because the mint is non-transferable. Check out the program logs:  [
  'Program TokenzQdBNbLqP5VEhdkAS6EPFLC1PHnBqCXEpPxuEb invoke [1]',
  'Program log: Instruction: TransferChecked',
  'Program log: Transfer is disabled for this mint',
  'Program TokenzQdBNbLqP5VEhdkAS6EPFLC1PHnBqCXEpPxuEb consumed 3910 of 200000 compute units',
  'Program TokenzQdBNbLqP5VEhdkAS6EPFLC1PHnBqCXEpPxuEb failed: custom program error: 0x25'
]

That’s it! We have successfully created a non-transferable mint. If you are stuck at any point, you can find the working code on the solution branch of this repository.

Challenge

For the challenge, create your own non-transferable token with the metadata extension and keep a “soulbound” NFT to yourself.

​Summary

​Overview

​Creating non-transferable mint account

​Lab

​1. Getting started

​2. Setting up dev environment (optional)

​3. Create a non-transferable mint

​4. Mint token

​5. Attempt to transfer a non-transferable token

​Challenge