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Introduction
Welcome to the Solana Name Service (SNS). SNS has a simple mission of providing a decentralized and yet affordable way to map domain names (represented as .sol) to on-chain data. Where on-chain data can be anything from a Solana (SOL) address to IPFS CID, images, text, and more.
One of the clear benefits of the name service is a human-readable name that maps to a SOL address. Essentially, creating an identity for users in the metaverse.
Why does this matter you may ask? Well, wallet address formats can be a barrier to entry, and therefore having an identifiable address can facilitate payments and its efficiency.
Nonetheless, Solana domain names can have much broader applications than just payments. Most decentralized apps (dApps) have a single point of failure which is their centralized and censorable domain name. However, on-chain domain names cannot be censored or taken away! Thus a website hosted on IPFS (or Arweave) using a Solana domain name would be completely decentralized and very difficult to censor.
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Disclaimer

In order to prevent scammers, it was decided to add a safeguard mechanism by preserving some domains for people who might be at risk of being impersonated.
These domains will appear as “RESERVED BY BONFIDA”

Twitter handles & .sol domain names

Both Twitter handles and .sol domain names are a part of SNS, yet are slightly different. A Twitter handle can only be claimed by the owner of the Twitter account. In order to guarantee this, the user needs to tweet the wallet address they want to associate with the account and then sign a transaction using the same wallet address. An oracle then verifies that the public key contained in the tweet matches with the signer. In practice, this means that Twitter names are already reserved. Twitter users just need to claim their public key by tweeting it.
Still, this has privacy implications that require you to have an identifiable Twitter account. This is where .sol domain names are useful. The domain names serve the same purpose as Twitter handles except they do not require you to reveal any personal information or a Twitter account.
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Disclaimer
Twitter handles & .sol domain names