Author: CloudY, Sihan
Editor: Vincero, YL
Review: Crystal
Preface:
DID and DeSoc have gradually become topics that everyone is talking about. From Monaco to Lens Protocol, everyone is exploring the social ecology of Web3.0. From DeepDAO to Cyber Connect, everyone is building a decentralized interpersonal network, and domain name service providers such as ENS are building an identity system based on wallet addresses. But in fact, there is an intermediate layer between the social ecology/interpersonal network and the identity system, which is the interaction record of the wallet address. Its most direct role is to build a user portrait. A comprehensive and detailed user portrait is what Web2.0 companies have to strive to obtain at the cost of infringing user privacy, because a perfect user portrait can help companies accurately locate user behavior and provide the most efficient products or services at the lowest cost. However, due to the fact that the breadth and depth of data are limited by their own business scope and antitrust, such user portraits are out of reach for Web2.0 companies. However, all user data in Web3.0 is publicly available on the chain, and anyone can obtain and analyze it, which can be said to be a dimensionality reduction attack on Web2.0. However, unprocessed data is just a string of characters. Therefore, we need to analyze the data issuance certificate (such as SBT) to represent a series of behaviors, and then build an on-chain profile of the user based on this series of behaviors to give value to the on-chain data.
However, due to the limitations of blockchain technology and the early stages of the industry, the collection and analysis of wallet address interaction records is still in its infancy. Wallets are currently still regarded as an asset storage tool rather than a Web3.0 identity carrier to represent the user's on-chain reputation, and most interactions are abandoned. However, with the rise of DeSoc, project owners found that they needed a lot of data to build user identities and define user influence and reputation. The emergence of ENS domain name services also made users realize that wallets are actually the key to open the world of the metaverse. In particular, Vitalik Buterin mentioned Soulbonding Token (SBT) and the Web3.0 user identity system or Web3.0 social credit system in his paper "Decentralized Society: Finding Web3's Soul", which made DID a hot track again, and everyone turned their attention to this field.
This article will explore in depth the empowerment of on-chain user behavior records under the concept of DID, that is, establishing on-chain user portraits, point out the problems caused by the current lack of on-chain user behavior records, summarize and evaluate existing solutions, and finally give our ideas on possible mature solutions and their roles in this field in the future.
On-chain image project introduction/analysis:
At present, on-chain behavior analysis and user profiling are still in the early stages of exploration. The market not only lacks mature on-chain profiling solutions, but also lacks sufficient usage scenarios, whether from the B-end or the C-end. Below we list several relatively mature on-chain profiling projects on the market, and make a preliminary analysis from the perspective of the project fundamentals, the pain points of their solutions, and the entry points of the track. We hope to use this as a guide to explore the future development direction of on-chain user profiling.
1. Project Galaxy
Project Galaxy is a general underlying protocol for on-chain portraits. It obtains on-chain information through subgraph indexes and wallet snapshots, and integrates off-chain data sources to obtain off-chain information to establish a user interaction database. The on-chain data obtains the user's on-chain interaction data through subgraph queries or snapshots of wallets. Project Galaxy records user interaction behaviors in three forms: OAT (On-chain Achievement Token), NFT, and Credentials. OAT is mainly used within the Project Galaxy protocol. Credentials are centrally recorded on Project Galaxy in the form of data. It allows the event organizer to distribute interaction credentials (OAT/NFT) to qualified users based on its database according to specific needs. It also provides OAT oracles and APIs, so that the event organizer can give all users with target credentials airdrops or voting rights and other rewards. Users need to find activities of interest on their "Campaign" page to participate in order to obtain the corresponding credentials. In the future, Project Galaxy will also provide open APIs to link with other projects.
Track positioning analysis:
As a universal underlying protocol for on-chain portraits, Project Galaxy has built a Web3 DID (Decentralized ID) system.
For the partners of Project Galaxy, they will be able to obtain aggregated information sources from multiple channels on and off the chain. And they can create activities and vouchers by simply submitting parameters and badge designs. Activities can guide users to perform specified on-chain behaviors, and the created vouchers (such as OAT) will be used as rewards for user behaviors. The data dimensions and distribution standards of such vouchers can be defined by the project party itself.
For developers, Project Galaxy can provide them with application modules, credential oracle engines, and credential APIs. Developers can use Project Galaxy's NFT infrastructure and on-chain credential data network to build and distribute NFT badges (OAT).
In addition, Project Galaxy provides each user with a Galaxy ID, which is equivalent to a universal user name. Users can generate a Galaxy ID by linking their wallet to the official website. Project Galaxy connects the credentials in series through the Galaxy ID to form a credential data network. Users can also use the Galaxy ID to display the credentials collected in the Web3.0 world, such as NFT badges, to highlight their historical achievements. Users can see the event details and rewards of each project party (Project Galaxy partner) on the Project Galaxy website and freely choose to participate.
From this, we can see that Project Galaxy, as a leading project of on-chain portraits, currently has a solution for on-chain portraits that is more biased towards the B-side, tending to provide partners with on-chain + off-chain portrait information aggregation protocols and services for project parties, while partners and such activities further attract C-side traffic. Of course, as a general underlying protocol, Project Galaxy actually includes a three-end protocol for users, partners, and project developers. For users, they can also query their own Web3.0 on-chain and off-chain behavior information on the website. For developers, Project Galaxy will also open APIs to provide more underlying services for project developers. Project Galaxy has a huge imagination space.
2. Rabbit Hole
Rabbit Hole is a relatively mature self-contained on-chain behavior recording protocol. It uses its own skill NFT to profile user capabilities, and then limits target users according to user skills in the task section, and formulates corresponding tasks to help project parties that publish tasks to achieve user positioning and screening. Rabbit Hole records user data through non-transferable NFTs under the ERC721 standard deployed on the ETH mainnet as credentials. However, Rabbit Hole has also added some new features on its basis, such as allowing users to transfer the Soulbonding NFT to the destruction address (0x00...), one address can only have one corresponding NFT credential, and the credential contract can be upgraded through the standard proxy contract. Although Rabbit Hole aims to become a core component of the Web3.0 ecosystem, the system currently develops its own protocol in a relatively centralized way rather than directly establishing the underlying general protocol. Therefore, its system currently provides two types of credential NFT usage methods: permissionless integration and partnership. Permissionless integration credentials can be used with tools such as Guild and Collab.Land. The partnership type is the corresponding credential customized by the project party.
Rabbit Hole focuses on the collection and proof of on-chain information. It uses verifiable on-chain data to implement proofs in two dimensions: “Skills” and “Quests”.
First, in the skill section, Rabbit Hole divides it into three directions: DeFi, NFT, and DAO, and provides three attributes of Topic, Level, and Season for NFTs in the three directions to represent the advanced level of skills, but currently there are only the introduction level and Season 0. To obtain the skill certificate NFT of the corresponding direction, users need to complete the on-chain interactive tasks (Tasks) specified by Rabbit Hole. For example, after users complete the three tasks of "Mint an NFT on the Zore chain", "Join a Party on PartyBid", and "Publish an Entry on Mirror", they will be able to claim a DeFi direction certificate.
Secondly, in the task section, Rabbit Hole will release on-chain interactive tasks specified by other project parties, and require users to have certain "skills" or "Bright ID" to participate, and will be rewarded with a certain amount of designated tokens or NFTs after completion.
Track positioning analysis:
Rabbit Hole is currently used as a task distribution protocol for projects. Partners pay for their tasks, thereby motivating users to complete specific operations on the chain. Users complete corresponding interactive behaviors through the protocol and obtain points from the protocol or incentives from the project. This positive-sum interaction helps users learn new skills or methods in the crypto industry and earn rewards for them, and also brings a large number of new users to the DAPP protocol.
On the other hand, Rabbit Hole's user portrait is limited to the scope of users on its website, and does not include all behaviors on the entire address chain or even off the chain. There is no developer access channel for the time being. We can see that Rabbit Hole's market direction focuses on to C, and the to B function and the underlying functions of the protocol need to be improved.
3. DegenScore
The vision of DegenScore is to build a Metaverse based on on-chain information. In a research report by a16z, DegenScore is defined as a system that aggregates and simplifies on-chain address information, making it more readable and easy to compare, and used to measure the user's obsession with cryptocurrency.
DegenScore has established a complete ecosystem for on-chain addresses, including:
(1) Complete on-chain behavior scoring: including highlight moment display, labeled addresses, ranking system, etc.
(2) Cooperation with other project parties: The CAFE section displays cooperation activities with other project parties, such as airdrops, various interactions, etc.
(3) DegenScore provides an easy access interface for other projects. Any DAPP can integrate the scoring service provided by DegenScore into its ecosystem, which will become one of the bases for screening and judging users.
DegenScore has multiple and comprehensive scoring dimensions for behaviors. In the V1 version, DegenScore forms Degen scores through a series of on-chain behaviors, including but not limited to holding specific tokens; interacting with specific smart contract protocols, and adding the dimension of time, such as early DeFi farmers. In the latest V2 version updated this year, DegenScore further refines the scoring system into three major sections: DeFi, NFT, and Others. The DeFi section includes whether it is an early protocol participant, the number of DeFi token transactions, the number of pools participating in the farm, the time node, the duration, etc.; and in the NFT section, whether you have participated in a series of blue-chip NFT MINTs such as BAYC AZUKI, or whether you hold blue-chip NFTs, etc., are all important scoring reference dimensions.
Track positioning analysis:
DegenScore has established a complete on-chain resume in the Web3.0 field with a unified standard, and its evaluation dimensions and standards are partially confidential. Users and cooperating project parties cannot freely choose the on-chain portrait dimensions, but only provide the evaluation scores provided by DegenScore officials. Although this method reduces the freedom of choice of project parties and users, it also improves the referenceability and credibility of the data. The application of DegenScore can be applied to both the B-end and the C-end, but at present, the concept of "on-chain resume" has been greatly expanded on the B-end, such as a considerable Web3.0 startup team using resumes to find job seekers, etc.
4. Noox
Noox is a decentralized on-chain achievement proof platform that allows users to publish, prove, and mint on-chain achievements in a permissionless manner. Therefore, it is essentially a programmable on-chain data verification infrastructure. Noox mints users' Web3.0 achievements into Soulbound NFTs (Noox Badges), which are programmable on-chain achievement NFTs (Non-transferable ERC-1155 Tokens) under the non-tradable ERC1155 standard. Noox badges contain a string of metadata for on-chain operations, eligibility criteria, and verification logic for each badge. Anyone can program arbitrary rules into the badge standard to use data such as EventLogs, Transaction, etc. to obtain user on-chain transaction information (e.g., transaction currency, transaction quantity, transaction value, type of interaction, etc.).
Track positioning analysis:
Currently, through the Noox protocol, users can claim badges issued under the rules established by Noox, so Noox at this stage is more like a tool for recording on-chain interactive behaviors developed independently by the protocol. In other words, Noox verifies the composable badges and on-chain data built into the protocol through smart contracts and verification oracles to create a more collaborative and elite-managed network. In Noox's vision, the construction of such a network is bottom-level, transparent, and open. Therefore, the mature Noox protocol is a community-driven, contribution-first, and blockchain-based system that can build user portraits of Web3.0, record how users interact on the chain, and build applications and protocols to understand the structure of users' interactive behaviors, which makes it equally effective for B-side and C-side.
5. ARCx
ARCx is a decentralized liquidity market on ETH and Polygon that provides the safest and most capital-efficient lending experience in DeFi by using DeFi Credit Score. ARCx's main goal is to improve the capital efficiency of the DeFi lending market by measuring and rewarding high-value lending behavior. ARCx uses DeFi Credit Score to continuously analyze on-chain behavior and assess the credit risk of individual wallet addresses in DeFi. The DeFi Credit Score is a numeric value (between 0 and 999) that describes the credit risk of an individual address based on its on-chain lending activity. The score calculation is based on historical data and operational experience of each borrower in managing risk and avoiding liquidations over a period of time. The score is calculated off-chain and then published on-chain through ARCx's custom oracle infrastructure. The DeFi Credit Score is updated on-chain with a 48-hour delay. The score is composed of three main components - Daily Score Reward, Survival Score Reward, and Liquidation Penalty. These three components are combined to produce the final DeFi Credit Score.
Track positioning analysis:
ARCx’s entry point is similar to DengenScore’s on-chain standardized rating system, but it is more focused on the DeFi field, similar to Sesame Credit in the DeFi field. From this perspective, ARCx’s biggest difficulty may be how to get more DeFi projects to accept this type of rating system and establish the reliability of their own reputation system, which is a problem worth exploring continuously.
6. lvl protocol
The lvl protocol is a product of indie DAO, designed to meet the different types and needs of each DAO and even Web3.0 organizations, and link different types of Web3.0 communities. The lvl protocol uses an interoperable "Soulbound" NFT to record data. The lvl token is a dynamic NFT that shows the skills acquired by users in each community, combines data from multiple sources (data from major social networking sites, stored in IPFS), is verified by the community, and then stored on the chain, so any smart contract can interact on the user's lvl protocol. It connects data from each DAO and ecosystem in an SBT manner while maintaining on-chain interoperability, and anyone can mint lvl NFTs.
Track positioning analysis:
lvl is an encrypted resume, as well as an on-chain reputation and skills Web3.0 resume, highlighting all the user's data, experience and contributions in the community, DAO and Web3.0 nodes. For users: lvlNFT can be minted to track contributions, skills and reputation on the chain. And it changes dynamically. For community administrators, the lvl protocol can be combined with community data to customize the community-related data or resumes obtained by members, and all off-chain data from your community, DAO, game or metaverse can be aggregated into the member's on-chain lvl token.
The main application of the lvl protocol is in the DAO field. Any community can connect their existing data sources to the lvl rollup API. Community managers can customize their data sources and types, which include information sources from SourceCred, Coordinape, Discord, Twitter, Figma, Github, etc.
7. Earthquake
Sismo is a modular proof protocol that focuses on decentralization, privacy, and usability. The protocol is deployed on Polygon. Sismo issues SBT as Non-Transferable Token (ERC1155), which is called badge in Sismo's ecosystem. With Sismo, users can generate a wide range of on-chain information and proofs, such as "donated to Gitcoin grants", "voted 2 times in ENS DAO", or "sent more than 100 transactions on Ethereum". Since Sismo is a modular data protocol, the on-chain data can be freely selected by the creator. Through identity proof, users can access advanced features in Sismo ecosystem services or prove their reputation in applications and protocols that use the above proofs. The Sismo protocol is built on multiple modular concepts: accounts, proof creators, registries, and badges. The Sismo protocol is open source and modular, which allows multiple types of proofs to coexist, which allows the protocol to allow creators to build, modify, and update the protocol together to adapt to different needs.
Track positioning analysis:
First of all, Sismo is a low-level modular proof protocol, which means that the Sismo protocol can be easily used and compatible with other protocols. Project parties can freely choose modules according to their own needs to meet the needs of projects and users. In addition, one of the focuses of Sismo is ZK badges (zero-knowledge proof badges). Currently, Sismo has not disclosed how they are created or used. The generation process of ZK badges relies on the zero-knowledge proof mechanism and ensures the privacy of users and data. ZK badges are privacy-protecting badges and do not create any links between the source account used to prove qualifications and the target account that receives the badge. This means that project parties can complete the user's behavior screening while fully guaranteeing the privacy of the user's address to issue qualification certificates SBT or some kind of rewards.
On-chain image imagination space and application scenarios:
First of all, users have the right to choose which credentials to use to represent themselves or even reject unwanted credentials, rather than passively allowing the protocol to label them. This is the premise of everything. Secondly, we believe that the final form of on-chain portraits should be an open source, protocol-level, modular user behavior record ecosystem based on data acquisition methods such as The graph subgraphs and APIs to prevent certain protocols from centrally monopolizing free user data. In this system, as the issuer of credentials representing user reputation, the qualifications of the protocols themselves also need to be reviewed and selected by users, otherwise a situation will be formed in which the credit on the chain is monopolized by centralized institutions, resulting in the protocol being able to do evil at no cost and control user credentials at will. Therefore, based on the choice of both parties, users and other project parties can modularly find the interaction records corresponding to the target behavior, and forge credentials to represent the existence of the behavior, and establish a reputation/portrait for themselves. At the same time, these credentials should be interoperable across the entire chain or even across chains, especially between public chains that support EVM (the same address, i.e., the same identity carrier, can be used through a private key), so that the on-chain behavior can form a complete user portrait to maximize its value. For example, in the middle stage of development, a leading project will join hands with other leading projects to establish a set of common ERC standards based on their existing credentials or form a credential certification organization composed of DAOs to standardize the on-chain identity system and build a user portrait system recognized by most projects and users, which will eventually become a widely used on-chain social credit system token standard like the ERC20 standard.
In such an environment, on-chain user portraits can be formed, an on-chain credit/reputation system will be established, and the value of each address's interaction records can be evaluated and utilized. Based on the characteristics of on-chain user portraits, we have built several application scenarios for it: 1. DeSoc; 2. On-chain resume protocol; 3. Launchpad and AMA and other publicity protocols; 4. Uncollateralized financial system; 5. A complete social credit system formed in combination with the off-chain authentication system.
1．DeSoc
As a social protocol built on user influence, DeSoc needs to obtain the user's on-chain behavior and the interaction behavior of other users with it, which naturally fits the definition of on-chain portrait. Among the current DeSoc projects, there are many protocol-level products such as Lens Protocol and Cyber Connect, which aim to create an interoperable on-chain social network. But the problem is that although the underlying user social graph of each protocol is common to the projects that support the protocol, the user social graphs between different protocols are incompatible or even mutually exclusive, which will force projects to stand in line and choose a protocol to use, and inevitably lose potential users outside the protocol. However, user portraits can solve this problem well. A unified user interaction recording system can directly provide different projects with a cross-protocol data source that can be modularly processed, so that they can adjust the weights of different interaction behaviors according to their own positioning, and finally come up with a user portrait that best suits them.
2. On-chain resume protocol
The resume protocol can be said to be the most intuitive way to express user portraits. Users process their own interaction records and generate a corresponding certificate to reflect their own abilities and resumes. At present, DeepDAO mainly scores each person in a relatively centralized way and displays relevant information, such as the number of DAOs they have participated in, the number of proposals they have initiated, the number of votes they have voted, etc., and this is only the function of one of its sub-sections. User portraits can provide users with proof of skills such as coding ability, use of financial derivatives, NFT issuance, and proof of resumes such as participation in voting on key proposals of well-known projects, several borrowing behaviors that have not been liquidated, and being responsible for a hack incident and returning all funds. These user portraits formed by records that cannot be tampered with and have their intrinsic value will be a concise and feasible resume of the user. At the same time, on the other hand, the on-chain records of a DAO organization or project can also be their on-chain resume. Based on their TVL, AUM, cooperation with other organizations or projects, profitability, whether they have been hacked or other major events, such as the stablecoins issued have been depegged, etc., we can judge the quality and credibility of a project. Based on this, the on-chain resume protocol can establish a capability assessment system for individual users and organizations or projects, and match or rank them according to the needs of both parties.
3. Launchpad and AMA promotion agreements
The promotion agreement can be said to be another very suitable use scenario for user portraits. The project party can accurately locate the user according to the user's portrait, reach the real potential users, and provide them with more attractive incentives. The existing leading Launchpad and AMA and task release and other promotion agreements, such as TrustPad and Project Galaxy, are all indiscriminately facing all users, which will undoubtedly increase the cost of the project party and reduce its promotion efficiency, because the whole process will inevitably lead to the existence of wool parties who will leave at a glance. When the user portrait on the chain is successfully established, the project party can establish a corresponding interactive behavior screening mechanism, use the same or even less amount of funds, and locate more real target users. Users can also reversely find projects that suit them based on their own portraits, and participate in the early stages of the project to contribute to maximize their own benefits. This can be said to be an application of the resume protocol in 2 to some extent.
4. On-chain credit financial system
The user's on-chain portrait is the embodiment of the user's reputation and credit on the chain. There is no credit in the current blockchain, so all financial behaviors need to be based on over-collateralization. Otherwise, smart contracts must be used to limit the scope of operation of lenders. Over-collateralized lending by Aave, BendDAO, etc. and leveraged lending by Alpaca, Gearbox, etc. are no exception. This phenomenon greatly reduces the efficiency of funds on the chain. As mentioned above, user on-chain interactions have their intrinsic value, and based on this value, a corresponding credit system can be established to achieve unsecured lending. But in fact, this is not necessarily completely unsecured. It can be uncollateralized, and only a certain amount of loans are allocated based on the past behavior and current status of the address; it can also be to adjust the original collateral rate, or reduce the loan interest, etc.; it can also accept installment payments, buy first and pay later, etc.; it can even provide secured loans for other addresses.
5. Complete social credit system
This system is exactly what V God expects SBT to achieve in the article. Through off-chain proofs, such as identity cards, degree certificates, and real estate certificates, the credit endorsement of on-chain identities is established, and then based on the on-chain reputation established by on-chain interactive behaviors, a complete social credit system combining on-chain and off-chain is constructed to achieve the combination of blockchain and real credit. Although this system will be a mature solution for on-chain identities, the binding of real identities with on-chain identities may still belong to the field of Web3.0, but it is no longer so in line with the spirit of Crypto. Therefore, although it may be one of the final solutions, we believe that this system will only be an option for the on-chain credit system, and users can still choose to use only pure on-chain solutions.
Conclusion:
In the digital economy era, people always say that user data on the Internet is a gold mine, and Internet companies realize data value-added by processing data. In the Web2.0 era, for enterprises, user data is fragmented and difficult to see the whole picture. For users, the ownership of data belongs to the platform. The value of processed data is irrelevant to individuals. In the Web3.0 era, due to the characteristics of blockchain, the user's on-chain footprint belongs to him/her, which fundamentally changes the ownership structure of data. In order to enhance the reputation of the user address, users are also willing to build their own on-chain portraits. For the protocol parties, they can achieve user growth and capture more value through a more comprehensive user portrait compared to the Web2.0 information island era. Therefore, on-chain portraits have development potential that we look forward to.
Source：
https://wrenchinthegears.com/wp-content/uploads/2022/05/Vitalek-Buterin-Soulbound-Token-Paper-May-2022.pdf
https://deepdao.io/people
https://galaxy.eco/
https://mirror.xyz/0xBdA3229d75099397f902B43a1DbD18b6175c11A7/MqbpBjaQoh5LqrD-qsnB95JKH-dRdPotJTzqbkc33nc
https://docs.galaxy.eco/
https://noox.world/
https://docs.noox.world/
https://rabbithole.gg/
https://docs.rabbithole.gg/rabbithole-docs/welcome-to-rabbithole/our-mission
https://mirror.xyz/cryptolich.eth/o9-KJ4dzsWszGTqKMWcsF5Zb3BE0lCDdyrPx-zEoVHo
https://rabbithole.mirror.xyz/CYsaX0fT-IOV5OO3JiDcXpLFdcnhocVOO5pTZ52hsLEdegenscore.com
arcx.money
https://wiki.arcx.money/welcome/arcx-credit-introduction
https://www.lvlprotocol.xyz/
https://indiedao.gitbook.io/indiedao/products/lvl-protocol
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