The identity and reputation of the Web3.0 world.

Editor’s note: This article from the value chain, the author: Sina Habibian, translation & proofreading: IAN LIU & Elisa, the daily planet unauthorized release.

 The identity and reputation of the Web3.0 world.

Why Identity & reputation is so important

Let us know how to release from the identity and reputation value to protocol level.

The one-time game into repeated game

The blockchain users are anonymous, and replace the new address of the cost is negligible, so it is difficult for the user agreement proper behavior. To today, we are accustomed to the concept of pledge or “punishment” to constraint, essence is through some of the funds confiscated participants (usually ETH or ERC20 tokens) to punish evil behavior.

Suppose we have a way of scarcity can reflect the identity and reputation in the digital way, can modify the existing equity mechanism, take the same way as the confiscation of funds, the perpetrator’s reputation suffered losses. In contrast, consensus protocols can also reward the high reputation of the participants in the network; for example, to give them more revenue (referred to with Cosmos and Keep project work in the “work token” token analogy). Participants have the motivation to optimize their own reputation, and not for short-term interests; then the one-time game into repeated game.


On sampling, the most important application is the consensus mechanism itself (like Proof-of-Work and Proof-of-Stake took the anti attack witch certification). This can be extended to other cases, for example, choose who store files, or by the who in the resource market execution work.

Current limiting and pricing strategy

Current limiting and pricing strategy of many network services through, to meet the different levels of consumer demand. In the case of Dropbox, it uses the freemium model (anyone can use the service for free, but free service Co.). The identity system, to the center of the protocol can achieve similar functionality. Like Filecoin, you can use the freemium model to user needs to provide more low price.

In addition to the protocol layer, we also see a lot of applications require identity.


The blockchain existing voting system, is based on token voting patterns. A token is a scarce resource, to provide anti witch attack mechanism, but this also leads to the chaebol autocratic, rich people have more of a say. The two party vote (Quartic Voting), although the mechanism can reduce the impact of wealth, but it can still take advantage of loopholes; such as a money will be distributed to multiple accounts.

And the identity authentication allows two parties to implement voting scheme.

Reputation from users in the agreement had behavior, or from the community trust of the user; can be used as a decision node voting weight basis.

No doubt, the vote of the security chain requirements more stringent than the above. For example, in order to avoid bribery occurs, participants should not open their vote (on the “anti stress” to describe the more general introduction, see Daian, Kell, Miers, and, Juels in this article.)

To loan

The chain of credit agreement cannot be trusted to participants, so completely to mortgage lending, the high cost of borrowing to curb the development of the application.

The identity system through the verification of the borrower in the real world of some of the features (credit records, proof of ownership, income and so on), to reverse the situation. Reputation, by the previous experience or other people to guarantee, can be regarded as collateral.

Security token

Will the real world collateral tokens, such as real estate, equity, art, can enlarge their value: value added is token can reflect partial ownership, with timely clearing, and participate in the global 7*24 market advantages. The issuing and trading of the token must abide by the Securities Law (the transaction participants were KYC, AML, and other qualification, examination), these restrictions can be internalized to the token itself (such as the use of Harbor method R-Token) or enforce exchange delivery (as in the call to the center of the transfer of the first implementation of such ERC20 exchange the limit function before).

Token sale & airdrop

Tokens can motivate participants in the network dropped. Some recent examples such as Livepeer Merkle drop Mine and Handshake ‘s airdrop, open source is drop mechanism. The identity and reputation system, we can design more sophisticated air distribution mechanism. Including the application, identity and reputation here: to build a social attribute chain game (such as the popularity of the game will affect the price of the goods, and the lowest income) login access control, DPoS, universal, and input the polymerization to the center of the oracle.

Now, let’s look at exactly what the identity and reputation.

What we say is the identity and reputation?

Identity is the most basic role in the system. In the etheric Fang, Fang can be said to Ethernet address is the identity account.

The identity can be used to prove themselves and others had some things, we have these things called the statement. With the passage of time, with the identity system established reputation.

Identity, statement, and reputation of the agreement, should be through the appropriate interface interaction. This system must be modular and extensible, also have the following characteristics:

  • To the center (Decentralization): protocol rules should be enacted and obeyed by the participants in the network, rather than by the central executive authority.

  • Autonomous (Self-sovereignty): the user to control their own identity, statement, and reputation. The Web and 2 network to form a great contrast; in the Web 2 network, such as Amazon; a businessman products accumulated reputation may be due to bankruptcy or Amazon decided unilaterally, removed.

  • Portability and interoperability (Portability & interoperability): the system should not detain the users, and users should be allowed to other systems on their own data migration.

  • Anti attack Witch (Sybil resistance): the protocol design, must consider the participants can gain an advantage by publishing multiple identities; in addition, the agreement replaced the old identity identity is not good. Build a go to the center of the anti attack witch identity system, is involved in all aspects of the problem. This problem can be easily calculated using a single function, but difficult to repeat the calculation; or is a kind of human action not by machine performance. For example, Proof of Work and Proof of Stake are common mode current.

  • Privacy (Privacy): Participants should be able to share data with others selectively. In addition, the identity of participants under the condition of default can be verified by not publicly identified.

  • Next, let us understand the three parts of this system: identity, statement, reputation.


    The identity can refer to the external account (held by private key control), or a smart contract (multi signature, DAO, etc.). The identity information can be used for data encryption, signature, or published on his own or another person’s statement.

    Identity management, key management is one of the most important. The private key and the biggest difference is the use of smart identity, contract management so that we can expand some function, such as key recovery, access control and dynamic cost limit etc..

    Identity management contracts should include key recovery mechanism, in the face of the following conditions:

  • The key is lost (lost user permissions)

  • The key is stolen (user permissions, the thief would have permission)

  • The key is stolen and lost (user loss, the thief has permissions)

  • There are many mechanisms can come in handy here: community recovery, suspended proof service, or through the Shamir secret sharing and Schnorr signature method.

    The separation of key specific functions, can be divided into different security levels. In the case of ERC-725, the proposal to hold different key for managing, action, statement, and encryption.

    In order to protect privacy, users need to create and manage different identities in different usage scenarios. If we use the same, complete identity to borrow, to pledge their authorization, payment, will lead to the user in the real world identity was finally exposed cross comparison. Deterministic classification mentioned in BIP in 32/39/44 (Hierarchical Deterministic) method can come in handy here.

    Finally, the identity and other methods must system has a good interoperability, and can be applied to W3C DID (to the center of the authenticator Decentralized Identifier standard).


    The statement refers to the identity of another identity of the facts.

    “Semantic statement Claim” follow the “one entity is proposed on a topic statement, and be able to express many things:

  • “A B has passed the KYC statement.” For the anti – attack witch

  • The A B statement is qualified investors.” For regulatory compliance (such as sale and mortgage transaction tokens tokens, etc.)

  • The A statement by over 21.” For age restricted products

  • “A B is Chinese citizen statement.” For compliance review

  • “A B a x income statement.” For credit risk guarantee

 The identity and reputation of the Web3.0 world.

The statement signed by the statement, so its authenticity and integrity can be verified in encrypted form.

Any party can also issued a statement on its own (such as Name, nationality, birthday).

Some design guidelines to keep in mind:

  • The statement must be encrypted (Claims should be encrypted): the statement may contain sensitive information, it should always be stored in encrypted form. The data owner can open to information flow optional, data sharing to a specific identity object (for example, by the method of Diffie-Hellman key exchange).

  • As little as possible on the data stored in the chain (Store as little data as possible onchain): unless required chain review (for example, a license is required, otherwise the statement ERC20 transactions) should be stored in data chain, only the chain stores its encrypted form (such as Merkel, the root of the tree value). In addition, taking into account the future vulnerability of quantum computing and popularization of current encryption system, even if the data has been encrypted, nor the stored in the block chain.

  • Only the publisher can remove the statement (Only the claim creator should be able to remove their claim): this can make network have the ability to issue a negative statement, without fear of them to be deleted. For example, you can declare an Ethernet address is Fang phishing (from false ICO to twitter “free money” scam and so on, which is always present in the world, the problem of encryption) or the seller did not fulfill their business responsibilities. To this idea, we can imagine that if a user is involved in has nothing to do with him or malicious third party statement, how to do? This is not a problem, because there is no authoritative statement. The statement just by the identity of a proposed, on the identity of another state, but believe it or not, decide completely by the verifier.

 The identity and reputation of the Web3.0 world.

  • The statement is valid (Claims can expire): the statement does not always effective. For example, in some jurisdictions, the trusted state need to be updated once every 90 days. Each statement issued at the time of the containing block height, so the verifier can decide the validity of these statements.

  • Now, let’s look at some of the design plan.


ERC 725/735

ERC 725 is a smart identity contract proposal, implementation of a standardized interface management identity statement, deployment number ERC 735. The user needs to approve all their relevant statement, and can always delete. Because the system does not require multi-party collaboration, so it can be upgraded.

This proposal has some problems. Because each identity to deploy their own statement contract, and therefore can not guarantee that all comply with the specification of ERC in 735. Therefore, when dealing with these identity verifier, must first check their source code; it brings a lot of inconvenience. What is worse, allows the user to delete directly about their statement, hinder the entire system release negative statement.

Finally, privacy protection, ERC 725 needs a collocation chain system, because it will be all the statements are stored in the chain.

ERC 780

ERC 780 proposed the establishment of a global Workshop on Ethernet in the registry, to store all the statement on the etheric fang. UPort is to build a registry as to the center of the PKI system based on the goal is to transfer to the chain most statement. The registry is unable to distinguish statement accounts or contract; and because there is only one copy of the contract, all the verifier can believe it logic.

This is the proposal of the problem of limited expression statement. Because all declaration of compliance with the same data structure, which directly brings limitations on use. The upgrade will have trouble, because it requires a wide range of stakeholders support.

Zeppelin TPL

Zeppelin TPL (Transaction Processing Layer, transaction processing layer) is designed for ERC20 token permit trading. For each “jurisdiction” deployment of different contracts in this scheme. “Management of cluster jurisdiction are” elected certificate, the certificate issuer shall be entitled to a statement written into the jurisdiction of the registry statement.

This is a more practical design. The verifier more trust jurisdiction statement, because they know that these statements are certified. But on the other hand, only part of the user statement, will inevitably lead to the flexibility of the system is reduced.

This system may also encounter difficult problems to expand. No one jurisdiction will provide the full statement list (for management, geographic location, or different cases), so the verifier must check the number of registry, or object of the declaration must be repeated declaration in different jurisdictions.

The identity based on NFT

We can use NFT (Non-Fungible Token, irreplaceable tokens) form, will permit a group of authoritative node encoding, users can produce NFT, after verification for users. The problem here is that the user can exchange their NFT, and the design does not mention the use of NFT than the use of the advantages in which statement.


Maybe a feasible system can integrate the advantages of the method, called the joint statement of the registry.

First create a different statement for the registry; these registry inherited from the top and in the implementation of the contract, clearly regulate those statements can be added or deleted. This will increase the expression of the statement, while ensuring that no redundancy between the registry management statement.

In addition, the registry allows anyone to create a statement, and the verifier has the responsibility to filter out the statement they believe. They can be specific cases, based on the geographical location, or the time to decide whether to believe the statement, or by the center according to the organization (such as government) and to the center of the system (such as DAO) to provide the statement white list filtering.

Next, we enter the part of reputation.


We can be divided into two categories: reputation is a map based on the reputation of trust; two is the behavior evaluation based on the reputation of.

Based on the reputation of trust

This method is derived from the social network algorithm, PageRank, and delegative democracy has many similarities.

Thought experiment

Imagine, before the vote in the first large, square hollow cast accounts each etheric 100 trust tokens, and let them free will trust tokens assigned to their representatives to vote the views of the people.

At the appointed node during the campaign, you can be online for your account advertising (Ethernet address Fang on twitter, Reddit, website, etc.) for the support of others. We according to professional knowledge and their political expression in the community, corresponding to the appointment of candidates.

The appointment of the node at the end of the campaign, the appointment of each node to vote. Depending on the number of voting power trust tokens they get, can be used directly for the total number of tokens, like PageRank can also use a metric coefficient.

In our example, each line graph can be regarded as the trust token distribution. PageRank recursive method of collection of the wisdom of the masses, if many people will trust tokens are assigned to the A, then A is assigned to other tokens will have a higher weight; further, the weight of these appointed again assigned tokens and will be higher. In this way the reputation of iteration, as much as possible and weight closer to their true.

 The identity and reputation of the Web3.0 world.


It is important to note that this method can achieve the agreement in a statement. Put aside the trust tokens, users can use to other people to express the line in the above statement. But we can also see that there are some problems based on the method of trust.

Anti attack witch

The attacker can sign multiple identities, and allow them to trust each other, enhance the reputation of these man-made nodes. There are several solutions:

(1) trusted identity

There is a E parameter based on PageRank algorithm (U), web crawler can let people have a certain probability to jump to the preset “. This can prevent the reptile people were stuck in the witch attack subnet.

Similarly, in our case, can be set in advance a trusted identity; or you can choose from the real world has been authenticated in the collection.

 The identity and reputation of the Web3.0 world.

(2) local reputation

Everyone can be calculated in the local reputation. For example, in lending in the scene, the guarantor can only interact with themselves and other trusted identity from each user, to assess the risk of the borrower.

Interestingly, if a user is most online trust, the trust will converge towards the global view and the local view. This is similar to that in the credit theory, credit good party ious can also represent money.

(3) trust circulation channels created by scarce resources

Another effective method of attack against the witch in trust is the use of scarce resources to build trust distribution channels. Can equity form, or Proof-of-Work. In the case of Sourcecred, it relies on the Git code submitted to establish trust and dependence of. In such a map of trust, reputation to need a substantial workload, which can resist the witch attacks (unless there is self programming machine learning algorithm!).

(4) pattern matching

The analysis of trust we can also manually, and filter out some results in the analysis. For example, a group of nodes of mutual trust, but not by groups of people outside the trust, it may be regarded as a problem and remove.

excitation mechanism

In the trust of users, what is the motive to create the trust channel right?

P2P lending and insurance (e.g., TrustDavis) the operation may bring us a potential answer, is the node in order to obtain the channels to provide collateral. If the collateral they provide in circulation, gains; and if they do evil, will lose the collateral.

Another possible answer is that the existing behavior to create additional by-products as circulation channels based on trust. For example, publishers in their website with high quality links, in order to attract users, so publishers to provide the required data for PageRank. Similarly, a developer to create good libraries, and attract more contributors, it should maintain a friendly development environment; thus, they need to create the Sourcecred channel (recommend you take a look at Dandelion).

Another reputation is based on behavior evaluation.

Evaluation based on reputation

In this method, we do not rely on the map decision reputation, but everyone has always been the basis for evaluation of other behaviors. For example, in the Dharma loan agreement, the borrower’s reputation can be calculated by their payment records and the time axis; in Truebit is calculated on the basis of past reputation to successfully solve the task.

We can also be this kind of reputation evaluation into agreement with the users; improved reputation, can get a bigger discount costs or they in the network is higher income.

The method relies on the anti attack system can operate the identity of the witch. Because if there is no identity system, anyone can improve their reputation through fraud work.

Another annoying problem is that people can build up their own reputation and then to a scam from the end. Before lending platform exchange and bitcoin has occurred in this case, the reputation plan must go through rigorous analysis, and considering the economic cost of the Byzantine behavior.

Other considerations about reputation plan

Reputation is with environmental restrictions. A good borrower does not necessarily is a good Casper stakeholders, it does not mean that would be good for Livepeer decoding. As Stefan George said, a good reputation in the gang, you don’t have to believe him.

Finally, we also need to continue to explore the concept of “negative reputation”. If an identity may be lower than the reputation of zero, they may be inclined to abandon the existing identity, with a new identity to join.


The identity and reputation is an important research topic. They can be transformed into the agreement from the single game and repeated game, is a necessary part of many block chain applications, such as sampling, pricing strategy, governance, lending, mortgage tokens and airdrop etc..


Thanks to Yondon Fu, Liam Horne, Robbie Bent and Melisa Smith feedback about this article. Thanks to Ali Yahya, Nicola Greco, Dandelion Mane, Andy Bromberg, Faraaz Nishtar, Sunny Aggarwal, Sid Ramesh, Nadav Hollander, Dan Finlay, Ryan Sepassi, Ben Fisch, Dieter Shirley, MartinK, ppelmann, Stefan George, Kei Kreutler, Fred Ehrsam, Bjorn Wagner, Yondon Fu, Robbie Bent and talk about other people this contributed to the ideas above.

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