A Non Fungible Token (NFT) is a special type of cryptographic token that represents something unique. Unlike a cryptocurrency, which is a fungible token (FT) like bitcoin or ADA, NFTs are unique, indivisible, and scarce, but they are also transferable just like FTs.
Since March 2021, with theHard Fork Mary, was enabled on the Cardano blockchain the feature to mint native tokens, which supports user-defined NFTs natively, without the need for smart contracts, unlike Ethereum.
The possible uses of NFTs are innumerable. The most common current use of NFTs is as collectibles, that is, artistic digital cards, for example of a famous sports figure of limited existence and with unique digital markings. ADA Handle has made innovative and useful use of the NFT.
What is ADA Handle
The typical solution to the naming problem has been domain names, until now. For example, there is a product built on Ethereum called ENS (Ethereum Name Service), which provides domain resolution for an address. The main idea is to replicate the registry service DNS (Domain Name System), known and used on the web, but within the blockchain ecosystem.
ENS works in the form of registration contracts, which it uses to resolve domain names. Also, these contracts can point to IPFS (semi-decentralized storage) hashes and tend to work like normal addresses, allowing subdomains to be added.
There is an application similar to ENS in Cardano: adadomains.
But ADA Handle is not a domain service. Let’s see what it is.
Cryptographic hashes form the address markers for crypto wallets; they are unique and never duplicated. But these alphanumeric texts are intimidating and impractical for everyday use, and to complicate matters further, UTxO-based blockchains like Bitcoin and Cardano, use multiple addresses: a user gets a new address (or UTxO address) every time they want to send native assets. I leave an article so you can understand this topic (1).
A simple and elegant solution for the Cardano ecosystem was launched on mainnet on March 13, 2022: a username for your address, easy to remember. It’s a sNFT-based naming solution for a wallet address on the Cardano network.
ADA Handle is based on the NFT standard that allows on-chain secured personalized Cardano addresses, dynamically resolving the address of the holder’s wallet.
For example, instead of typing the standard network address, which might be: addr1qyenp9mzyjlvx0m0hsf5695a948qxguh70j4q4nszdewpavm33x8hfgs9ln5c92edmrkgd0sa33z7tagfw3uclq5exnsap7hh7 it’s much easier to write, and remember, $mynickname (both address and handle are non-existent, used for explanation).
ADA Handle can be thought of as a domain service that owns the address, and the chain (rather than a DNS) takes care of the routing details.
The ADA Handle standard makes the location of a handle, and its corresponding address, very simple.
Each Handle is a unique NFT, minted and issued on the Cardano blockchain, and they act as unique identifiers for the UTXO they reside on.
Since all this data is stored on-chain in its entirety, anyone can consult it.
An ADA Handle issued NFT is delivered to the buyer’s shipping wallet address. Once confirmed on the blockchain, the handle associates an address of the wallet in which it is located, and directs the funds to it each time it is cited in a transaction. The handle can be sent to another wallet, keeping the same name, but it will change the address for receiving funds to the new wallet.
The ADA Handle does not own the data associated with the address and never requests or interacts with the wallets private key, instead returning a valid Cardano cryptographic address each time a $handle is sent.
ADA Handle uses the format $handle ($mynickname, taking my previous example) and denotes it with $. The reason for using $ instead of @ is to differentiate yourself from social media platforms as an identifier of a user, and it could cause errors as it could tag a random user.
There can be two NFTs with the same asset name, but to differentiate the identity, the solution was to standardize the NFTs, which are protected by Policy ID.
In Cardano, all NFTs are minted with a unique Policy ID, which can only be generated by the Policy’s private key, and therefore acts as a guarantee of the NFT’s identity, thus being cryptographically secure, and guaranteeing that a handle is true and not can be copied. You can see the ADA Handle Policy ID, and the more than 200 thousand handles minted to date: f0ff48bbb7bbe9d59a40f1ce90e9e9d0ff5002ec48f232b49ca0fb9a
One of the advantages of UTXO-based blockchains is the increase in privacy, since for example, each time you send funds a new UTXO is created, and thus you can hide your real balance by fragmenting it into different “sub-wallets”. Address reuse is generally discouraged to improve privacy.
Writer’s note: $handle by definition is not a privacy solution. By purchasing a $handle, the address it points to is simply the UTXO it resides in, and this is why anyone can technically query the data.
The development is open source, and is published in GitHub, reviewable by the community.
The Roadmap
The ADA Handle team has recently released an update to their 2023 Roadmap:
The Team
The company Kora Labs is the developer of ADA Handle.
The 3 founders of ADA Handle tell on the website who they are:
—Calvin has nearly 15 years of web software experience ranging from small side-projects to fortune 500 companies, to Facebook. Before starting ADA Handle, he started The Crypto Drip with Goose, a growing community of like-minded crypto enthusiasts intent on redefining decentralized media.
—Conrad is an InfoSec and IT infrastructure engineer, with 20 years of corporate experience, 10 of those in New York City. Conrad is a sports aficionado. When he’s not working, you’ll catch him on the West Side Highway cycling or skateboarding.
—Mr. Goose comes from the competitive suit-and-tie world of commercial lending in Silicon Valley. After years of stringent professionalism working with some of the largest tech companies in the world, Mr. Goose decided it was time for an about face. Finding Cardano was a perfect fit for his ethos as he brings a light-hearted yet severely professional approach to negotiation, management, and business strategy.
You can see the rest of the team here.
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(1)Accounting Models in Blockchain: UTxO, eUTxO and Account Models
