With the support of DID, the one-person-one-vote agreement can help more accurately quantify participation in governance and eliminate the composition of certain agreements based on capital voting for members.
Original title: “Depth | Analysis of DID Decentralized Identity: A Booster in the DeFi Field”
Written by: Humpty Calderon, Ontology Community Director Translation: Mike Jin
In the past year, people’s awareness and interest in decentralized identity solutions have increased significantly. Decentralized identity solutions help users, among other things, control their digital identities without requiring the input of intermediaries. In addition to the benefits of individual users, decentralized identity solutions have the potential to create a seamless, accessible and verifiable ecosystem. A decentralized identity has the potential to solve many problems in the DeFi field, and even more.
What is a decentralized identity?
First, it is important to define what our decentralized identity or DID means. A DID can be provided to anyone or anything, whether it is an individual, an organization, or a device. Compared with typical identifiers such as driving licenses or passports, DIDs are designed so that they do not rely on centralized registries, identity providers, or certification authorities.
For example, the key pairs used to create digital wallets are isolated on the blockchain that created them. On the other hand, DIDs can run on various platforms, including different blockchains. Together with verifiable credentials (VC), people can create a stronger version of their identity, linking real-world credentials, such as your university degree and certification, social media accounts, and government-issued documents, such as driving licenses or passports. Go to a secure ID.
Although identity issuers and verifiers can interact to discover DID-related information, the design enables DID holders to fully control their identities and data, and choose the information they wish to share with any other party (if any) ) . This is manifested in reality that users who use a decentralized identity protocol can safely manage their digital identities, store them on mobile phones or cloud services, and have a private key that allows only authenticated users to access.
What are the challenges that DID seeks to solve?
Now, cryptocurrencies are mainly around currency use cases. Examples of these are decentralized applications (dApps), which benefit capital rather than membership or contribution to the ecosystem. The Plutocratic (one token, one vote) system reinforces an unfortunate cycle, making most dApps speculative and only beneficial to those with capital.
A more ideal and equal model is to create an ecosystem that provides use cases for one person, one vote. DID can play a role in this regard, by seeking to provide humans active in the cryptocurrency ecosystem with the ability to verify their identities and use their reputation on the chain to create a more convenient, safe and valuable experience.
Rather than creating a cryptocurrency whale, it is better to integrate DID into a cryptocurrency protocol to ensure that participation is open to everyone and funds can be more evenly distributed in the ecosystem. In addition, with the support of DID, the one-person-one-vote agreement can help more accurately quantify participation in governance and eliminate the composition of certain agreements based on capital voting for members.
Wealth management
When it comes to DeFi, DID can help solve some problems related to airdrops. If the project only airdrops to users who use the DID protocol to verify, they will ensure the fair distribution of tokens in the pool of participants. Members must be certified, reducing the possibility of robots running out of airdrop contracts, which is an urgent problem for some in the DeFi field.
The DID protocol allows the credit evaluation system to verify the user’s score and background based on the data stored on the blockchain. This means that users can obtain credit-based loans while still maintaining control over their identity. Through DID, all parties can access the decentralized financial system, not just giant whales.
A reputation system that measures on-chain behavior can help isolate responsible borrowers from fallen ones, essentially making the entire system more robust and reliable. DID can promote a self-sovereign credit score to users, which they can use to obtain credit, borrowing, and investment.
NFT
Implementing DID solutions in the NFT field will bring multiple benefits. In recent months, interest in NFTs has been unprecedentedly high. NFTs have many potential use cases, but they have gained popularity mainly through their use in digital art. By deploying the DID solution with NFT, buyers and sellers will be able to verify the creator or any specific digital artwork, as well as the collector.
This ensures that the representative value will be transferred to the creator or seller. DIDs can also be implemented to help keep NFTs in the hands of communities that support them, instead of casting tokens for speculation, increasing the price of tokens, making it almost impossible for people without capital to obtain them.
DAO
A DAO is a group of people who work for a common goal and have a shared bank account. Without tools to measure the needs of the community and the contributions of members, they may not be able to assess the needs of their members or incentivize outstanding contributors fairly.
DAOs that use token-based governance prioritize the opinions and needs of large token holders who may not be active contributors, while ignoring groups who may be active contributors but do not hold a large number of tokens. DID can enable governance mechanisms to more accurately measure community opinions.
The DAO recognizes that it is vital that members make influential contributions and reward them accordingly. DID can show the contributions of members more clearly, allowing incentives to be used to reward and retain outstanding talents.
In addition, as DAO members are proficient in their roles, DID allows them to create verifiable resumes, show their contributions to other DAOs, and then they can pre-evaluate their value and reward them accordingly.
What projects are developing the DID protocol?
Ontology brings trust, privacy and security to Web 3.0 through decentralized identity and data solutions. They have developed a comprehensive identity infrastructure, including an identity wallet that allows you to easily create digital identities, a composable, cross-chain reputation protocol, and a DeFi protocol that leverages your decentralized identity and self-sovereignty Credit to achieve low mortgage loans. To learn more about Ontology, please visit https://ont.io
Bright ID is a social identity network that allows you to prove that you only use one account. Creating your digital identity is as simple as installing an application and verifying your identity by joining a connected party. You can enjoy the benefits of your unique identity directly from the app. To learn more about BrightID, please visit https://brightid.org
Idena is the first personal proof blockchain based on democratic principles. Every user has a cryptocurrency identity-a person with equal voting rights and mining income. Every unique human operating the Idena validator node can start mining Idena. In order to verify that you are a unique person, you do not need to disclose any personal data (no KYC). You join a verification ritual and solve a series of flip tests (human-made verification codes). For more information about Idena, please visit https://www.idena.io/
Serto is a decentralized identity platform that allows everyone to easily exchange data in a trusted, private, and scalable way. Easily verify the issuer of any data. Transform free-form data into verifiable certificates, issue them to partners and customers, and integrate data from other parties into your processes–all of which are trusted methods. Learn more about Serto: https://www.serto.id/
Gitcoin connects communities that develop digital public products, creates financial freedom, and defines the future of open networks. They have developed the Personality Proof Passport, which is a transportable personality proof identity used in the web3 space, allowing you to earn rewards by proving your personality on any integrated dApp, using the same that you have already used on Gitcoin Grants identity. To learn more about Gitcoin, please visit https://gitcoin.co/
What is the future of DID?
The position of decentralized identity solutions within and outside the blockchain and cryptocurrency industries may grow exponentially in the next few years. The more blurred the boundary between digital life and physical life, our online identities will become more and more complex. If these identities are stored in multiple centralized systems, they will become more difficult to manage. Decentralization solves these problems, and its impact on the future may be very large.
Original link: https://thedefiant.io/how-decentralized-identity-can-take-crypto-to-the-next-level/
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