Author: Joyce, BlockBeats

On January 3, Anatoly Yakovenko, co-founder of Solana who previously popularized Silly, retweeted a post on his social media, bringing significant attention to a protocol called "Tiny SPL." According to the tweet, Tiny SPL is a new token standard protocol on Solana that introduces a "state compression" method, allowing users to hold tokens on Solana without having to pay storage rent.

The token asset based on Tiny SPL is "DN (Deez Nutz)," which was initially available for free minting. After minting, some users listed DN for trading on the market, and the floor price of DN rapidly dropped after breaking 0.2 SOL, reaching 0.00089 SOL at the time of writing. Currently, DN is circulating on NFT trading platforms Magic Eden and Sinper.

From the price changes, it seems that market interest in Tiny SPL may not be high. However, Solana co-founder Anatoly still has the retweet about Tiny SPL pinned on his Twitter homepage. The technological innovation represented by Tiny SPL, "state compression," was also a hot topic in the Solana ecosystem in 2023. Given this, Tiny SPL may see new developments in the future.

Tiny SPL, a smaller version of SPL

"Rent" in Solana Accounts

Before introducing the special features of Tiny SPL, it is necessary to explain the concept of "rent" in the Solana account model. Rent is different from transaction fees. Users pay rent to store data on the Solana blockchain, while transaction fees are paid to process instructions on the network.

Unlike Ethereum, Solana charges a fee for accounts on its network to store data states, known as rent. Rent is charged periodically based on the size of the token balance stored in the account. If an account cannot pay the rent, the system will delete that account to reduce storage costs for data that is no longer maintained. If the assets in an account exceed the minimum balance for two years' rent, that account can be exempt from paying rent.

According to the official website, rent is derived from the underlying hardware storage costs. Therefore, as technology advances and hardware costs decrease, rent is expected to decline. However, since rent is paid in SOL, and with the recent rise in SOL prices, the actual rent paid by users will also increase. Asset management company VanEck mentioned in a valuation report on Solana that the rent storage fee on Solana is 0.00000348 SOL per byte, with a wallet data size of 372 bytes, meaning each active wallet holder must maintain 0.0026 SOL. Similarly, applications and token smart contracts must also cover these storage fees. A program like Serum, which is about 340 KB in size, needs to maintain a balance of 2.4 SOL to avoid paying rent.

Solana's token standard is SPL, and Tiny SPL aims to create a "smaller" version of the SPL token standard. Through state compression, users can own tokens without paying rent.

Attracting Helium Mobile to Migrate to Solana with State Compression

State compression is a new method for storing data that Solana launched in April 2023, significantly reducing the cost of on-chain storage. This technology relies on Merkle trees, which can compress the verifiability of a data tree into a hash. The compression-friendly structure allows developers to store a small amount of data on-chain and update it directly in the Solana ledger, greatly reducing data storage costs while maintaining the security and decentralization of the Solana base layer.

Related reading: 《MT Capital Research Report: The Eve of a Full Explosion in the Solana Ecosystem》

The first application scenario for state compression was in NFT minting, which reduced the cost of minting NFTs on Solana by 2,400 to 24,000 times. According to the Solana Foundation, as of April 5, 2023, minting 1 million uncompressed NFTs on Solana cost over $250,000. In contrast, the minting cost for NFTs using state compression is approximately $110.

Last month, the popular DePIN project Helium Mobile minted nearly 1 million NFTs when migrating to Solana, with a minting cost of only $113. This became a typical test case for the state compression method, as these NFTs can serve as network credentials for Helium and verify hotspots, while also integrating functionalities for the entire ecosystem, including token gating and access for hotspot owners.

Related reading: 《Detailed Analysis of Current Popular DePIN Projects: Honey, DIMO, and Helium (Mobile)》

Through the state compression feature, Solana provides creators and brands with a way to offer a large number of NFTs to a broader audience without incurring significant costs. Now, Tiny SPL applies the state compression method to token assets, meaning that compared to tokens using the conventional SPL standard, Tiny SPL tokens do not require rent payments. Additionally, Tiny SPL tokens do not appear in the user's wallet balance but are only visible in the NFT section.

Interaction Process of Tiny SPL

In terms of user experience, the token management aspect of Tiny SPL is quite unique. Currently, the token asset "DN (Deez Nutz)" based on this protocol has been minted, and interested readers can purchase it on the secondary market. Please note that DN has no actual value; this section is solely to introduce the interaction process of Tiny SPL and should not be considered investment advice.

Visit the Tiny SPL official website at https://tinys.pl/, and click "Get started" to connect your wallet. It is recommended to use a test wallet without significant assets.

After connecting the wallet, the page will detect the number of Neez Nutz you own and display it (if any). The icon for Neez Nutz is two peanuts.

When trading token assets, you need to determine the quantity to be traded. In Tiny SPL, determining the trading quantity requires a "split" or "combine" process.

First, click on Neez Nutz to enter the token management interface. If you want to send 1 DN, you need to split 125 DN into 124 DN and 1 DN before the transfer. Here, 312 DN has already been split into 112 DN, 109 DN, and 100 DN.

If you want to continue splitting, select the asset 100 DN and click "Split." In the pop-up page, enter the quantity to be split, and after confirming, click "Split."

In the wallet pop-up page, confirm the signature. Here you can see that the operation on the wallet side is "send 100 DN, receive 99 DN and 1 DN." It is important to note that there are transaction gas fees involved in this process.

After confirmation, wait, and when the following page appears, it indicates that the split was successful. Click "Done" to view the split tokens.

To combine Neez Nutz, select the DN you want to combine and click the pop-up "Combine." The subsequent steps are the same as the splitting steps.

After successfully splitting or combining, it will reflect on the wallet's NFT section showing the Neez Nutz assets. Here, "2" represents 2 (different counts) of DN, and then users can trade Deez Nutz in the form of NFT transactions.

Retweeted by Anatoly, worth paying attention to in the future

The founder of Tiny SPL, sol_idity, is also a full-stack engineer at the Web3 payment infrastructure Sphere. Currently, Tiny SPL seems more like a technical experiment. After the launch of Tiny SPL, the split and combine functions experienced issues, which have now been fixed. If Tiny SPL truly has application scenarios, it may be aimed at projects with a huge demand for token issuance. Currently, its token Deez Nutz is positioned more as a combination of meme and NFT.

Additionally, although Tiny SPL's feature is "storing tokens without paying rent," during the split and combine process, the wallet will display that a certain gas fee needs to be paid. Many people split Deez Nutz into the smallest unit of 1 DN for trading. The founder stated that 1 of 100 DN is the same as 100 of 1 DN and is considering creating a batch combine tool to make it easier for users to combine DN.

In addition to technological innovations like "state compression," Anatoly Yakovenko's action of retweeting and pinning posts related to Tiny SPL is also a reason why Tiny SPL is worth paying attention to. As a co-founder of Solana, Anatoly's "pump and profit" effect is evident. The most well-known meme coin in the community, derived from Anatoly's tweets and his dinosaur persona, is SILLY, which was the most followed meme on Solana last month, with holders experiencing a maximum profit of 27,000 times.

Related reading: 《Reviewing the Journey of Silly: How a Meme Became the Spiritual Totem of Solana?》

On January 2, Anatoly replied with a dragon emoji under a tweet related to Solana's new meme coin "LFG," after which the LFG token surged over 50%, reaching an all-time high. However, it is important to note that the trading process for Deez Nutz is more complex than that of typical meme coins, and its narrative is not as interesting as SILLY. The potential for future development remains to be seen.