Amazing things are created on Web3 – often by pseudonymous individuals who prefer to keep their identities private in the real world.
It’s liberating in some ways. It means that anyone can have a chance to get involved in a project and provide value to the community – regardless of their background.
But as decentralized identities proliferate, there’s one problem that can’t be ignored: Making sure there’s an easy way for us to verify the reputation of others.
This matters… for many reasons. If you are going to start using a DeFi project created by someone with a pseudonym, you would like to know that it is trustworthy and reliable.
If you are reading an article that someone has written online, there should be a way to verify that their past work has been truthful and well received.
And if you’re buying an item from another user on a peer-to-peer marketplace, it’s important to check that they deliver what you asked for — and on time.
All this has made reputation a hot topic in Web3. Now this concept is being explored in great detail by several crypto enthusiasts – giving us proof that we need to trust other people without knowing their name and background.
This could be a refreshing antidote to the status quo where not everything we see online can be believed. Fake product reviews are a long-standing problem, while Twitter bots can distort reality and our perception of people and companies. We’ve even seen experiments where fake restaurants shot to the top of the TripAdvisor rankings.
Understanding Decentralized Identities
As a concept, DIDs remain at an early stage. However, one day your crypto wallet can store much more than altcoins and NFTs. Instead, they can be a rich backdrop to what you’ve accomplished—open to all. And while the profiles that some of us carefully cultivate on Facebook and LinkedIn are centralized, we would see that we are in full control of all our data.
Ethereum co-founder Vitalik Buterin recently explained how this could work in practice when he presented proposals for “soul bound” NFTs. Known as SBT, it paints a picture of how these digital assets could be used to represent everything from a college degree to a driver’s license — and even provide a modern alternative to credit scores.
Buterin pointed to the proof-of-stake protocol as an example of a technology that could also hold promise. POAP NFTs can be used to prove that someone was present at a specific event – such as a conference or concert. While this could have a lot of exciting use cases in the future, there is one problem that needs to be addressed: Because NFTs are easily transferable, someone could buy a token that says they’ve achieved something – but products are coming to market, which prevent it.
As we find ways to dutifully record the achievements and attributes that make up our online reputation, Buterin argues that a non-transferable type of NFT needs to be created – and that could also bring tangible improvements to the way governance is achieved in decentralized autonomous organizations.
Technical limitations aside, you may be wondering why a digital reputation is needed in the first place. Well, a big motivation has to do with how our data is currently fragmented across a number of social networks and websites – and difficult to move from one place to another. If you have a five-star rating on eBay after selling 50,000 items, that stellar reputation is not easily transferred to Etsy.
Reputation is power
Metis is one of the projects that focuses on these challenges. The platform introduced Reputation Power, which is earned through on-chain achievements. Users can earn RP by contributing to protocols, DApps and decentralized autonomous companies – whether through deploying smart contracts or minting NFTs.
In the years to come, her vision is to create an environment where one’s reputation can be easily viewed on just one profile – connecting all aspects of life, from your loved ones and colleagues to the friends you share hobbies with. It’s the best way to demonstrate your credibility, engagement and credibility – as well as your contribution to the causes you care about.
The project told Cointelegraph:
“Metis Reputation Power is portable and buildable reputation, unique to specific user achievements and on-chain history. Reputation Power (or RP) can be accumulated by users performing on-chain actions, such as interacting with smart contracts or voting in governance.” .”
Recently, $100 million was raised to help cultivate projects that want to build on Metis – including DeFi protocols, NFT collections, metaverse platforms, and games. And that could be attractive to developers, not least because the platform has some of the lowest fees of any second-layer blockchain – helping to make microtransactions accessible.
At the heart of this ecosystem is a “robust, scalable, low-cost and decentralized” technical infrastructure called Smart Layer 2 – a secure environment that can handle growing user demand with the robustness the Web3 economy deserves.
There’s so much to look forward to – and a lot of work to ensure that Reputation Power becomes valuable for businesses and consumers alike.
We are focused on mass adoption and building an infrastructure that will be used for generations to come.
As the project recently said, “Although the market is getting bearish, may the builders never stop!”
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