Decentralized Identity - Industry Overview
The core narrative within the realm of decentralized identity (DID)
Decentralized Identity (DID) holds a pivotal role within the Web3.0 domain, serving as a foundational pillar for establishing trust in value exchange throughout the digital asset landscape. The concept of DID emerged in 2021 and has subsequently experienced swift advancement, paralleled by the inception of Soulbound Tokens (SBTs) in May 2022, a venture undertaken by Ethereum co-founder Vitalik Buterin, lawyer Puja Ohlhaver, and E. Glen Weyl.
Soulbound Tokens (SBTs) are digital identity tokens designed to encapsulate the attributes, traits, and achievements of individuals or entities. These tokens are dispensed by "Souls," which stand for blockchain accounts or wallets, and possess the unique quality of being non-transferable, often referred to as Non-Transferrable Tokens (NTTs).
Individuals have multiple wallets, known as "Souls," each dedicated to distinct facets of their lives. To illustrate, an individual might maintain a "Credentials Soul" to house their professional background, while also having a "Medical Soul" to manage their health-related records. This arrangement empowers individuals to construct a traceable digital standing on the blockchain, rooted in their prior activities and life occurrences. Conversely, users can opt to unify their records into a solitary Soul, integrating chosen data through a single wallet address that remains compatible across various chains.
Souls also have the capacity to symbolize entities responsible for distributing SBTs. For instance, a corporation could function as a Soul, granting SBTs to its individual employees. Likewise, a digital country club might utilize Souls to dispense SBTs for verifying membership privileges and similar purposes.
The concept of soulbound tokens (SBTs) draws its inspiration from the well-known online game World of Warcraft. Within this game, a soulbound item, once acquired, becomes non-transferable and cannot be traded to other players. It's this notion of an "unchangeable, enduring attachment" that prompted Vitalik Buterin, the founder of Ethereum, to ponder: What if NFTs could be subject to soulbinding as well?
In this regard, SBTs have transformed the landscape, elevating the notion of NFTs beyond mere currency and entitlements. They have evolved into tokens that encompass distinctiveness, non-transference, and versatility across multiple contexts. While NFTs signify possessions and worth, SBTs, conversely, encapsulate an individual's or entity's standing and accomplishments. Unlike NFTs, SBTs lack any monetary value and are non-negotiable once allocated to a wallet.
The establishment of DID involves the following aspects with regards to definition and categorization:
Data Systems: This encompasses formulating data maps and metrics, forging data classifications and models, devising algorithms for data scrutiny and exploration, as well as shaping data definitions.
On-Chain Identities: This involves crafting on-chain portraits (Metabeings), generating identity certificates, and implementing on-chain identity credit systems.
Relationships between Chain Entities and Events: This addresses the recognition of individuals or groups concerning non-biological identities, as well as the establishment of class assets and their derivatives.
Social On-Chain Relationships: Additionally, various perspectives from industry segmentation, such as hardware support, system enhancements, data structures, consensus norms, contract layers, and an array of supplementary application layer systems, contribute to the multifaceted realm of DID.
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