WAMO Summer Dali Web3 Fest DID Camp is one of the decentralized themed camps of the Dali Web3 Fest. Next.ID, UniPass, MetaID, and KNN3 co-hosted a round-table talk both online and offline. During the talk, the projects focused on building Web3 decentralized identities (DIDs) gathered and took a deep dive into the application level, imagination room, and the current problems in the DID build-out phase.

Here are the key takeaways from the round-table talk.

1. Why do we need DIDs? What are the biggest problems with the current ID system? Are DIDs solving the problems?

• DIDs provide users with the ability to prove their identities online without dependence on a third party. They are the foundation for the entire Web3 self-sovereign narrative. Only through DIDs can users fully own their identities.

• Problems with the current ID system:

  • 1. User data is stored on the respective servers of the different applications
  • 2. Due to the lack of trust among these applications, the data stored is much fragmented, causing data silos in Web2.
  • 3. Users can not fully own their data and are dependent on the mercy of these application providers.

• Blockchain-based DIDs solve the existing problems in the ways of

  • 1. Both user information and their data are stored on-chain, making it nearly impossible to tamper and stay permanently on-chain.
  • 2. Thanks to blockchain’s trustless and transparent nature, data generated by DID-based Web3 applications no longer belong to any business entities, and is interconnected and interoperable, fully owned by users themselves.
  • 3. Historical changes will be made by DIDs. Web3 without DID might be a false assumption.

2. What are the typical solutions for DID? Their pros and cons?

• DID, as well as Web3, is in the early stage. Different projects have their own understandings of DID, which does lead to differentiated focuses. Their visions might be identical, but the roadmap will not be the same. Which is the correct way is still under observation.

• The one and only criterion to decide whether a solution is successful is ultimately the number of satisfied users. The DID narrative has a strong network effect which will eventually benefit all projects on the same track.

• Typical solutions:

  • 1. Smart contracts
  • 2. EOAs (externally owned accounts)
  • 3. UTXO model
  • 4. Domain names
  • 5. To-Cs

• UTXO model and its pros and cons:

  • 1. Easier to make data fully on-chain.
  • 2. Larger user capacity.
  • 3. Lower transaction fees.
  • 4. Costs: there are fewer developers and users on UTXO, which makes it more difficult to start.

3. What are the prerequisites for DID to become mainstream? What is its biggest value proposition? What are the biggest blockers for now?

• Having enough use cases is key. Lowering the entry bar and better user experience will also be vital.

• Values provided by DID-based Web3 applications are relatively intangible to users.

  • 1. It is until there are more Web3 applications in the market and more interoperable data coming into being can users better understand the values of DID.
  • 2. This process is not short-termed, meaning the growth of decentralized identities will be a hard one but also will be exponential in later stages.

• The biggest blocker at present is the lack of infrastructure.

• Gas fees remain an obstacle for DID to achieve mass adoption for the high costs and the difficulty to obtain it. To solve this:

  • 1. Make gas fees lower.
  • 2. Onboard users with fiat on-ramps on gas fees.

4. Wallets, e.g. MetaMask, have become a common user identity layer for Web3 services. Are wallets equivalent to DIDs?

• Wallet and DID are two different applications at the fundamental key pair management level.

  • 1. MetaMask, for example, is built for financial purposes without optimizations in the DID use cases. While DID is more focused on identifying data.
  • 2. Wallets don’t provide users with enough rights to manage their permissions.
  • 3. DID solutions, on the contrary, lower the entry bar and provide users with a more flexible account permission management. Data is not interconnected and interoperable among different wallets, and a user’s identity is not unified cross-chain. MetaMask for now wouldn’t be enough to be an ideal DID-compatible wallet. We need better wallets for this.

5. What’s the relation between DID and social graphs? How do we build our own DIDs and reputation system in the Web3 era? Can the reputation system replace the voting power of tokens in DAO governance? How to build a non-tokenized social network?

• If DID-based Web3 projects go mainstream, because the data is linked, a user will only have one social graph on-chain then. This is a brand new experience for users and users will start to be careful with what they do on-chain as reputation will be an essential part of users’ identity assets.

• There is a large possibility that the reputation system can replace the voting power of tokens in DAO.

  • 1. Tokens only mean how much a user has invested, which doesn’t fit certain monetary scenarios, such as profit allocations.
  • 2. DIDs are more quantified metrics to identify DAO participants.

6. How to balance user privacy and data transparency since DID emphasizes openness?

• Privacy is always key in Web3 and is also an important standard to measure a DID solution/protocol.

• A good DID solution should be one that cares about privacy protections but doesn’t encourage anonymity.

  • 1. An anonymous society isn’t necessarily a perfect society. Introductions of technologies such as ZKP (zero-knowledge poof) are good ways to protect users’ privacy.
  • 2. After DID becomes popular, it should be less advantageous to speak and socialize anonymously. In the foreseeable future, there might be less anonymity.

7. How are SBT (soul-bound tokens) manifested in DID?

• SBT is a sub-DID to some extent, or we can say a good DID solution itself is an SBT.

8. Relations between DID, NFT, DAO, and DeSoc.

• Most of the current NFTs, DAOs, and DeSoc lack DIDs as their foundation, which will be hard for them to popularize.

  • 1. Only with DIDs can Web3 applications and NFTs, etc. be connected in the data layer.
  • 2. The network effect of such data connectivity will have a crushing advantage over applications that don’t have DIDs.

9. From DID to an immortal Metaverse

• DID is the foundation for Web3 and Metaverse.

• An immortal Metaverse is upon us:

  • 1. Combined with AI and DID, it’s highly probable that our minds live eternally in the Metaverse.
  • 2. The future Web3 and Metaverse, based on DID, is a tamper-proof digitalized virtual space that is not controlled by any business entities. As all our online activities become visible on-chain through DIDs, all our on-chain behaviors and our minds can be stored permanently on-chain.
  • 3. When most of our daily lives happen in the Metaverse or in the digitalized world, all this data can be moved on-chain. AI can then simulate our behaviors, our languages, and our minds through machine learning. 4). Immortality is realized when even our close friends and family members cannot tell the difference between AI and us.

Highlights from KNN3

With the rapid growth of Web3 and everyone's concerned about their privacy, DIDs as the carriers for the digital world have come to the spotlight today.

Currently, KNN3 Network as an aggregator of relational data has integrated with different DID protocols such as Next.ID and .bit.

The presence of DIDs allows for a better container for building the reputation system and social graphs. Web2 and Web3 are more relevant to each other thanks to it. A user’s on-chain activities and reputation no longer point to a single wallet but to a more figurative actor.

As DID protocol and the application of ZK continue to take shape, privacy will be greatly enhanced on the basis of users fully owning their data. We expect DIDs to take a bigger role in Web3 social in the future.

Highlights from Next.ID

DIDs are equivalent to ID cards and passports in Web2. Whether we can build a distributed and secure DID system following the Web3 paradigm will be the first step of dApp construction.

At present, EOA (externally owned account) wallets such as MetaMask are still the mainstream for users to use Web3 services for identity authorizations. Meanwhile, some services such as Web3Auth which builds identity authorization in the Web2 manner don’t serve the purpose of self-sovereign identities and full data ownership.

Next.ID wants to allow users to completely have control over their own data through VPS (virtual private server).

Project Info

UniPass: UniPass is a multi-chain unified crypto identity and your universal passport to the crypto world and the metaverse.

• Official site: https://wallet.unipass.id/

• Open-source link: https://v1.tryunipass.com/login

MetaID: MetaID is a Decentralized Identity (DID) sub-protocol of Metanet, the next generation of the Internet.

• Official site: https://www.metaid.io/

KNN3 Network: KNN3 Network is a Web3 Relationship Aggregator on multi-chain to empower Web3 social discovery & user enabling.

• Official site: https://www.knn3.xyz/

Next.ID: Next.ID, the world’s first protocol offering Decentralized-Identity-as-a-Service (DIaaS) is moving into beta testing. It is a decentralized identity aggregation protocol that integrates all Web2 and Web3 digital identities, offering a comprehensive and verifiable identity database for open-source developers and projects to innovate and build dApps on.

• Official site: https://next.id/

• Open-source link: https://github.com/nextdotid

• Discord: https://bit.ly/NextID_Discord_Official

• For WeChat users: BinaryHB

• Bi-weekly community calls：

  • Bilibili: https://space.bilibili.com/1004643496

  • YouTube: https://www.youtube.com/channel/UC17C9xWKp0h_pZhfxbNtHsg

About WAMO Summer Dali Web3 Fest

WAMO Summer Dali Web3 Fest is a two-day camp in the picturesque province of Yunnan, joined by a group of decentralized and DAO communities. The fest brings together tech talents, entrepreneurs, incubators, projects, and DAO practitioners to connect people to build a better Web3.