Solana Token Glossary
Clear definitions of Solana and SPL token terminology. Essential reference for token creators and blockchain newcomers.
A
Associated Token Account (ATA)
A standardised account derived from a wallet address and token mint. Each wallet has one ATA per SPL token. ATAs hold token balances and are automatically created when needed.
Authority
Permission to perform specific actions on a token or account. Common authorities include mint authority (create new tokens), freeze authority (freeze accounts), and update authority (change metadata).
Airdrop
Distribution of tokens to multiple wallet addresses at once. Often used for marketing, community rewards, or initial token distribution.
B
Burn
Permanently removing tokens from circulation by sending them to a null address or destroying them. Reduces total supply and can be used for deflationary tokenomics.
Blockchain
A distributed ledger that records all transactions across a network of computers. Solana is a high-performance blockchain optimised for speed and low cost.
C
Custodial
A service model where a third party holds your private keys or assets on your behalf. Custodial tools control your tokens temporarily or permanently. Opposite of non-custodial.
Circulating Supply
The number of tokens currently available and tradable in the market. Excludes locked, vested, or burned tokens.
D
DAO (Decentralised Autonomous Organisation)
A governance structure where token holders vote on decisions. DAOs can control mint authority, treasuries, and protocol upgrades without centralised leadership.
Decimals
The number of decimal places a token supports (0-9). A token with 9 decimals can be divided to 0.000000001 units. This setting is permanent and cannot be changed after creation.
DEX (Decentralised Exchange)
A platform for trading tokens directly from your wallet without intermediaries. Solana DEXs include Raydium, Orca, and Jupiter. Requires liquidity pools for trading.
Devnet
A test network for Solana where tokens have no real value. Used by developers to test applications before mainnet deployment.
F
Freeze Authority
Permission to freeze individual token accounts, preventing transfers. Most community tokens revoke this to signal decentralisation. Retained by regulated or compliance-focused tokens.
Fungible Token
A token where all units are identical and interchangeable. SPL tokens are fungible. Opposite of NFTs (non-fungible tokens), which are unique.
L
Liquidity Pool
A smart contract holding two tokens to enable trading on a DEX. Users deposit equal value of both tokens to earn trading fees. Essential for price discovery and trading.
M
Mainnet
The live Solana network where real transactions occur and tokens have actual value. Opposite of devnet (test network) or testnet.
Metadata
Information about a token stored on-chain, including name, symbol, image URL, and description. Displayed in wallets and explorers. Managed via the Metaplex Token Metadata program.
Mint
1) The act of creating new tokens and adding them to circulation. 2) The account that defines a token's properties (supply, decimals, authority). Also called the token mint or mint address.
Mint Authority
Permission to create new tokens and increase total supply. Can be retained, revoked (fixing supply permanently), or transferred to a DAO or multi-sig wallet.
Multi-Signature Wallet (Multi-Sig)
A wallet requiring multiple approvals (e.g., 3 of 5 signers) to execute transactions. Reduces single-point-of-failure risk for team-managed tokens.
N
Non-Custodial
A service model where you control your own private keys and assets. Non-custodial tools never access your wallet or hold your tokens. Opposite of custodial.
Network Fee
The cost of processing a transaction on the Solana blockchain. Paid to validators in SOL. Typically £0.0003-0.001 per transaction.
P
Private Key
A secret cryptographic key that proves ownership of a wallet and allows signing transactions. Must be kept secure and never shared. Loss of the private key means permanent loss of access.
Public Key (Wallet Address)
A public identifier for a wallet, derived from the private key. Safe to share. Used to receive tokens and verify ownership without exposing the private key.
R
Rent
A fee required to keep accounts stored on Solana. Accounts with sufficient SOL balance are rent-exempt and never deleted. Rent-exempt SOL can be recovered by closing accounts.
Revoke Authority
Permanently removing mint or freeze authority from a token. This action is irreversible and signals that the token supply is fixed or accounts cannot be frozen.
RPC (Remote Procedure Call)
A server that allows applications to interact with the Solana blockchain. Wallets and tools use RPC nodes to send transactions and query data.
S
Seed Phrase (Recovery Phrase)
A series of 12 or 24 words used to recover a wallet. Equivalent to your private key. Must be stored securely offline and never shared.
Signature
1) A cryptographic proof that a transaction was approved by the wallet owner. 2) The unique identifier of a transaction on Solana, used to track it on explorers.
Slippage
The difference between expected and actual trade price on a DEX. High slippage occurs in low-liquidity pools. Setting slippage tolerance prevents unfavourable trades.
SOL
The native cryptocurrency of the Solana blockchain. Used to pay transaction fees, rent, and as a trading pair for SPL tokens.
Solana
A high-performance blockchain known for fast transactions (5-15 seconds) and low fees (under £0.01). Launched in 2020, it supports smart contracts, tokens, and DeFi applications.
SPL Token
The standard for fungible tokens on Solana, managed by the Solana Program Library. Analogous to ERC-20 on Ethereum. All tokens created via this tool are SPL tokens.
Supply
The total quantity of tokens. Initial supply is set at creation. Total supply can increase if mint authority is retained, or remain fixed if mint authority is revoked.
Symbol
The short ticker code for a token (e.g., SOL, USDC, BTC). Typically 3-5 uppercase characters. Displayed in wallets, explorers, and DEXs.
T
Token
A digital asset created on a blockchain. Tokens can represent currency, utility, governance rights, or other value. SPL tokens are Solana's standard for fungible tokens.
Token-2022 (Token Extensions Program)
An upgraded SPL token standard with advanced features like transfer fees, confidential transfers, and interest-bearing tokens. Not yet universally supported but offers more flexibility.
Tokenomics
The economic design of a token, including supply, distribution, utility, incentives, and governance. Well-designed tokenomics align stakeholder interests with long-term project success.
Transaction
An instruction submitted to the blockchain, such as transferring tokens, minting, or updating metadata. Transactions require approval from your wallet and incur network fees.
U
Update Authority
Permission to change a token's metadata (name, symbol, image, description). Useful for fixing errors but can be revoked to make metadata immutable.
Utility Token
A token that grants access to a service, product, or ecosystem. Utility tokens drive demand through real use cases rather than purely speculative value.
V
Vesting
A schedule that releases tokens gradually over time. Used for team allocations, investor locks, or community incentives to prevent immediate sell pressure.
W
Wallet
A software or hardware application that stores your private key and allows you to interact with the blockchain. Examples: Phantom, Solflare, Ledger.
Wallet Adapter
A standard interface that allows websites to connect to multiple Solana wallets. Ensures compatibility across Phantom, Solflare, Backpack, and others.
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