Simple Ledger Protocol (SLP)

The Simple Ledger Protocol (SLP) is a standard for creating and transferring tokens on the Bitcoin Cash blockchain, introduced in 2018. It works by placing token information, such as the token's identity and the amounts being sent, in a small data field of ordinary Bitcoin Cash transactions marked with the OP_RETURN instruction of Bitcoin's Script language. Miners do not check these token rules; instead, SLP-aware wallets and indexing services read the data and work out balances, rejecting invalid transfers. This made SLP simple to deploy without a change to the base protocol, but it meant users depended on wallet software to validate tokens correctly. SLP was used for stablecoins, loyalty tokens and some NFTs on Bitcoin Cash. In 2023 Bitcoin Cash added CashTokens, a token system enforced by miners, which reduced reliance on SLP. Comparable token standards on other chains include ERC-20.