Introduction:
DID and DeSoc have emerged as trendy topics which everyone is talking about. Whether Monaco or Lens Protocol, they are exploring what the social ecology at Web3.0 will be. Also, DeepDAO and CyberConnect are trying to create a decentralized network, while domain name service providers such as ENS are building identity systems on the wallet addresses. But between social ecology/network and identity system is an intermediate layer - the interaction record of wallet address dedicated to creating user profiles. To some extent, exhaustive and elaborate user profiles are what companies on Web 2.0 are dying for even at the price of user privacy since perfect user profiles can help them accurately locate user behaviors and provide the most efficient products or services at the least cost. However, the limited business scope and anti-monopoly only lead to less wide and deep data, companies on Web 2.0 only dream of that user profiles. On the contrary, all user data on Web 3.0 is published on the chain, and they are accessible to anyone to analyze. It causes a huge impact on Web 2.0. The problem is that unprocessed data just means a string of characters. Therefore, we need to analyze the data release credentials (such as SBT) which stand for a series of behaviors, and on which on-chain user profiles are created to increase the value of on-chain data.
Since blockchain technology is widely limited and the industry is still in its infancy, we are just collecting and analyzing the interaction record of wallet addresses. The wallet is currently used to stock assets - not an identity carrier on Web3.0 to represent user reputation on the chain. Most interactions are neglected. With the rise of DeSoc, project providers realize the need for a large amount of data to build user identity and define their influence and reputation. The ENS domain name service also reminds users that the wallet is a key to the metaverse. Especially when Vitalik Buterin mentioned soulbonding token (SBT) and user identity system on Web3.0 or social credit system on Web3.0 in Decentralized Society: Finding Web3's Soul, the DID re-emerges as a hot field drawing the most attention.
This article takes a deeper dive into the empowerment of on-chain user behavior records in the context of DID, that is, creating user profiles on the chain. Then we point out the problems caused by the lack of on-chain user behavior records and summarize and evaluate the existing solutions. And we envision possible mature solutions and their functions in this field.
1.Introduction/analysis of on-chain user profile project:
The analysis of on-chain behaviors and user profiles is still in the initial trial-and-error phase. There are neither mature solutions for on-chain user profiles nor broader use cases for both businesses and consumers. We list some mature projects for on-chain user profiles popular in the current market and analyze their fundamental elements, the pain points, and the starting points with the aim to inspire more study in development trends of on-chain user profiles.
(1) Project Galaxy
Project Galaxy is a universal underlying protocol for on-chain profiles which collects on-chain data through sub-graph search and wallet snapshot and off-chain data through off-chain data sources to establish a user interaction database. The interactive data on the user chain is collected by subgraph query or wallet snapshot. Project Galaxy uses OAT (On chain Achievement Token), NFT, and Credentials to record users’ interactive behaviors. OAT is an internal tool in the Project Galaxy protocol while Credentials centrally write down data on the Project Galaxy. The latter allows the activity initiators to distribute interactive credentials (OAT/NFT) for qualified users on its database as specific needs are required. Credentials also provide OAT oracle and API in the way the initiators can reward all users holding target credentials with air drops or voting rights. Users choose and participate in activities that interest them on their "Campaign" page for credentials. In the future, Project Galaxy will allow open APIs to connect to other projects.
Positioning analysis:
Project Galaxy, the universal underlying protocol of the on-chain user profiles, has built a Web3 DID (Decentralized ID) system.
The partners of Project Galaxy can access the syndicated user data sources both from on-chain channels and off-chain channels. They can submit parameters and badge designs to create activities and credentials. In this way, activities can encourage users to act as required on the chain, and the created credentials (such as OAT) are the rewards to users for those behaviors. The data dimensions and standards to issue such credentials are independently defined by the project providers.
For developers, Project Galaxy can provide them with application modules, credential oracle engines, and credential APIs. Developers can build and issue NFT badges (OATs) by using Project Galaxy's NFT infrastructure and on-chain credential data networks.
In addition, Project Galaxy sets a Galaxy ID or a common user name for each user. A Galaxy ID is generated after the users tie their wallet to the website. Project Galaxy uses the Galaxy ID to connect all those credentials and form a credential data network. Through Galaxy ID, users can display their credentials collected in Web3.0, such as NFT badges, to highlight their past achievements. On the website of Project Galaxy, users can view the details and rewards provided by each project initiator who is the partner of project galaxy to freely participate in any of them.
It can be concluded that Project Galaxy, as the top on-chain profile project, prefers the business-oriented on-chain profile solutions, that is, to offer on-chain and off-chain user profile syndication agreements to serve project providers, while partners and such activities further attract customers. As a universal underlying protocol, Project Galaxy, of course, actually includes a three-tier protocol, respectively for users, partners, and project developers. Users can search their data of on-chain and off-chain behaviors in Web3.0 on the website. Project Galaxy enables open APIs and provides more underlying services for project developers. In a word, Project Galaxy has extremely bright prospects.
(2) Rabbit Hole
Rabbit Hole is a mature self-contained on-chain behavior recording protocol. It depicts user capabilities through its skills NFT, narrows down the list of target users according to user skills in the tasks, and develops tasks to help project providers who publish tasks to screen users. Rabbit Hole regards NFT deployed in the ETH under the non-transferable ERC721 standard as credentials to record user data. Rabbit Hole also adds new functions - allowing users to transfer the Soulbonding NFT to the destruction address (0x00...); one NFT credential for one address; upgrading the credential contract through the standard proxy contract. Although Rabbit hole aims to become the core component of the Web3.0 ecosystem, its protocol is developed in a centralized way, rather than directly on the basis of the universal underlying protocol. Therefore, its system currently provides two types of NFT approaches: unlicensed integration and partnership. The unlicensed integrated credential can be used with Guild, Collab.Land and other tools. The credential for partnership is customized for the project providers.
Rabbit Hole focuses on the collection and proof of on-chain data. It uses verifiable data on the chain to the proof them in terms of Skills and Quests.
Rabbit Hole classifies Quests into DeFi, NFT and DAO, and sets Topic, Level, and Season for NFT in those three directions to represent the senior level of skills. But only the introductory level and season 0 are available. To obtain the skill credential NFT in a different direction, users need to finish the interactive tasks on the chain specified by Rabit hole, such as "Mint an NFT on the Zore chain", "Join a Party in the PartyBit" and "Publish an Entry in the Mirror".
Besides, in the Quests, Rabbit Hole will release the on-chain interactive tasks prescribed by other project providers. To engage in those activities, users must have certain skills or Bright ID and will be rewarded with a certain amount of designated tokens or NFT after completion.
Positioning analysis:
Rabbit Hole is currently the task distribution protocol for the project providers. The partners pay for their tasks, which encourages users to complete specific steps on the chain while users finish the interactions through the protocol for the protocol points or the incentives granted by the project providers. This positive interaction helps users learn new skills or methods about encryption and earn bonuses while attracting a large number of new users for the DAPP protocol.
However, the user profile on the Rabbit Hole is limited to the users’ behaviors on its websites and excludes all the behaviors on or off the entire address chain. No developers are joining for the time being. It is obvious that Rabbit Hole focuses on the business market and the consumer market and the underlying protocol functions remain to be improved.
(3) DegenScore
DegenScore aspires to build a Metaverse based on on-chain data. The research by a16z defines DegenScore as a system that can summarize and simplify the data on the address chain to make them readable and comparable, and measure users' obsession with cryptocurrency.
DegenScore has established a perfect ecosystem for the addresses on the chain, including:
① Perfect on-chain behavior scoring: including highlight moment display, tagged address, ranking system, etc.
② Partnership with other project providers: CAFE displays cooperative activities with other project providers, such as airdrop, interactions, etc.
③ DegenScore provides an easy-access interface for other projects. Any DAPP can access the scoring service provided by DegenScore in its ecosystem, which becomes one of the bases to screen and judge users.
DegenScore has a multidimensional and complete behavior scoring dimension. In V1, DegenScore develops the Degen score 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 farmer. In the latest updated V2 this year, DegenScore further refined the scoring system into three sectors: DeFi, NFT, and Others. In the DeFi section, the scoring dimension includes whether it is an early agreement participant, the number of transactions and the number of transactions of DeFi tokens, the number of pools in the farm, time nodes, duration, etc; in the NFT sector, the important scoring dimensions are whether the user have participated in a series of blue chip NFT MINT such as BAYC AZUKI, or whether the user holds blue chip NFT.
Positioning analysis:
DegenScore has established a complete on-chain resume in Web 3.0 with a unified standard, and confidential scoring dimensions and standards. Users and project providers cannot freely choose the dimensions of the on-chain user profile; they only access the scores provided by DegenScore. Although this approach reduces the freedom of choice for project providers and users, it makes data more credible with the reference value. The DegenScore can be used by both the business and the consumers. The concept of an on-chain resume has been largely expanded in the business. For example, some start-up teams of Web3.0 are using this on-chain resume as a way to find job seekers.
(4) Noox
Noox is a decentralized on-chain achievement proof platform, which allows users to publish, proof and mint on-chain achievements without permission. Therefore, it is essentially a programmable data validation infrastructure on the chain. Noox mints the user's Web3.0 achievements as Soulbound NFT (Noox Badge), which is a non-transferable ERC-1155 programmable NFT (Non-transferable ERC-1155 Token). The Noox badge contains a string of metadata, qualification criteria, and verification logic for each badge for on-chain operations. Everyone can program any rule into the badge standard to use EventLogs, Transactions, and other data to collect transaction information on the user chain (for example, the currency of the transaction, the number of transactions, the value of the transaction, the type of interaction, etc.).
Positioning analysis:
Currently, through the Noox protocol, all users can claim badges issued under the rules established by Noox, so at this stage, the Noox is more like a tool to record on-chain interactive behaviors which are independently developed by the protocol. In other words, Noox uses smart contracts and verification oracle machines to verify composable badges and the on-chain data built into the protocol to create a more collaborative and elite-managed network. Noox envisions that this network is fundamental, transparent, and open. Therefore, the mature Noox protocol is a community-driven, contribution-preferred, and blockchain-based system. It can establish a Web3.0 user profile, record how users interact on the chain and build applications and protocols to understand the structure of users' interaction behavior, which makes it also work well in the field of businesses and consumers.
(5) ARCx
ARCx is a decentralized liquidity market on ETH and Polygon. It provides the safest and most capital-efficient lending experience in DeFi by using DeFi credit scores. The main objective of ARCx is to improve the capital efficiency of the DeFi lending market by measuring and rewarding high-value lending behavior. ARCx uses the DeFi credit scores to continuously analyze on-chain behavior and evaluate the credit risk of a single wallet address in DeFi. DeFi credit scores are a numerical value between 0 and 999, which describes the credit risk of a single address based on its on-chain lending activities. The score is calculated based on the historical data and operational experience of each borrower in managing risk and avoiding liquidation over a period of time. Scores are calculated off the chain and then released on the chain through ARCx's customized oracle infrastructure. The DeFi credit score will be updated on the chain 48 hours later. The score consists of three main parts - daily score reward, survival score reward and liquidation penalty, whose combination equals to DeFi credit score.
Positioning analysis:
The starting point of ARCx is like the on-chain standardized scoring system on DengenScore, but the former is more focused on DeFi, similar to the sesame credit score in DeFi. From this point of view, the biggest challenge for ARCx is how to make this kind of scoring system more acceptable to DeFi projects to establish the reliability of their reputation system - it deserves more continuous exploration.
(6) lvl protocol
The lvl protocol is produced by indie DAO for the different types and needs of each DAO and even Web 3.0 organizations and links different Web 3.0 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 and combines data from multiple sources (data from major social networking sites are stored in IPFS), which is verified by the community, and then stored on the chain. Therefore, any smart contract can interact with each other on the user's lvl protocol. It connects data from each DAO and ecosystem in the form of SBT, while maintaining interoperability on the chain so that anyone can mint lvl NFT.
Positioning analysis:
The lvl is an encrypted resume, as well as an on-chain reputation and skills Web3.0 resume, highlighting all data, experience and contributions of users in the community, DAO and Web3.0 nodes. Users can mint lvlNFT to track the contributions, skills and reputation on the chain - which changes dynamically. Community administrators can combine the lvl protocol with community data, customize the community-related data or resumes acquired by members, and summarize all off-chain data from the community, DAO, game or metaverse into the member's on-chain lvl token.
The lvl protocol is mainly used in the DAO. Any community can connect its existing data sources to the lvl rollback API. Community managers can customize their data sources and types, such as SourceCred, Coodinape, Discard, Twitter, Figma, Github, etc.
(7) Sismo
Sismo is a modular proof protocol that focuses on decentralization, privacy, and availability. The protocol is deployed in Polygon. Sismo releases SBT as a non-transferable token (ERC1155) - a badge in the ecosystem of Sismo. On Sismo, users can generate a wide range of on-chain data and proofs, such as donations to Gitcoin, voting twice in ENS DAO, or sending 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 identification, users can access the advanced functions in the Sismo ecosystem, or prove their reputation in the applications and protocols using the above proof. The Sismo protocol is based on several modular concepts: accounts, creator proof, registries, and badges. The open-source and modular Sismo protocol allows the coexistence of multiple proofs so that creators can work together to build, modify and update protocols together for different needs.
Positioning analysis:
On the one hand, Sismo is an underlying modular proof protocol and hence, Sismo protocol can be easily applied and compatible with other protocols. The project providers can freely select modules to meet the needs of the project providers and users. In addition, Sismo focuses on ZK badges - zero-knowledge proof badges. Currently, Sismo hasn’t published how those badges were created or used. The generation of ZK badge relies on a zero-knowledge proof mechanism and ensures the user's and data privacy. The ZK badge protects privacy by creating no links between the source account used to prove eligibility and the target account receiving the badge. This means that the project providers can screen user behaviors to issue qualification certificate SBT or some kind of reward while fully guaranteeing the privacy of user addresses.
It is clear that Project Galaxy, Sismo and even Noox are establishing themselves as the fundamental protocols applied to businesses and consumers, while DengenScore and ARCx are more inclined to establish an on-chain scoring and credit system based on their standards. In a more specific segment with definite demands, Rabbit Hole prefers to serve the business by using the established rules to educate DAPP users and attract new users and traffic; whereas the lvl protocol focuses on the on-chain and off-chain data behavior scoring system in DAO. We can have a glimpse of future trends in on-chain user profiles and gain insights from these selected projects.
2.Possible vision and use cases of on-chain user profiles:
First of all, the premise is users have the right to choose which certificates stand for them or even reject unwanted certificates, rather than being passively labeled by the protocol. Secondly, we think that the final form of the on-chain user profiles should be an open source, protocol-level, modular user behavior record ecosystem based on the sub-graph of the graph, API, and other data acquisition approaches to prevent some protocols from centrally monopolizing free user data. In this system, as the issuer of the certificates representing the user's reputation, the protocol's qualification also needs to be reviewed and selected by the users. Otherwise, a centralized institution might monopolize the credit on the chain. As a result, the protocol can be evil without cost and control the user's certificate at will. Therefore, on the basis of the choice by both parties, users and project providers can find the interaction records about the target behavior in a modular way, and cast certificates to represent the existence of this behavior, thus creating their reputation/profiles. Besides, these certificates should be interoperable among the chain or even across chains, especially between public chains that support EVM by using the same address through a private key - which is also the same identity carrier - so that the behaviors on the chain can produce comprehensive user profiles to maximize its value. For example, in the middle of development, a leading project, together with other top projects, establish a set of general ERC standards or form a certificate organization composed of DAO based on its existing certificates to standardize the identity system on the chain, and build a user profile system recognized by most projects and users. That eventually become the token standard in the on-chain social credit system as widely used as the ERC20 standard.
Only in such an environment can the on-chain user profiles be formed, the on-chain credit/reputation system be established, and the value of the interaction record in each address be evaluated and utilized. Based on the features of on-chain user profiles, we have built several use cases: 1. DeSoc; 2. On-chain resume protocol; 3. Launchpad, AMA, and other distribution protocols; 4. Unsecured financial system; 5. A comprehensive social credit system combined with the offline authentication system.
(1) DeSoc
DeSoc, a social protocol built on users’ influence, needs on-chain user behavior and their interactions with other users, which naturally fits the definition of on-chain profiles. Among the DeSoc projects, protocol-level products such as Lens Protocol and Cyber Connect aim to build an interoperable on-chain social network. Although the underlying user social graph in each protocol can be commonly used in any project supporting the protocol, the user social graph between different protocols is incompatible or even mutually exclusive. Projects have to choose a single protocol, and inevitably lose potential users outside the chosen protocol. But user profiles can deal with that. A unified user interaction record system can directly provide cross-protocol data sources that can be modularized for different projects, so projects can adjust the weight for interaction behaviors according to their positioning, and produce the most well-tailed user profiles.
(2) On-chain resume protocol
The resume protocol is the most intuitive user profile. Users process their interaction logs into proof that mirrors their capabilities and records. DeepDAO mainly scores each individual in a centralized manner and showcases information, such as DAOs which he’s in, proposals he initiated, and votes he cast. That is just a function under the sub-sector. Similarly, user profiles can work as proof of skills to code, leverage financial derivatives, and issue NFT. Furthermore, it is also a resume proof such as how many votes he has given on key proposals of famous projects, whether his several lending is liquidated or not and whether he is responsible for certain hack events, and return all funds. Formed by these tamper-proof and intrinsically valuable records, the user profile constitutes a simple and feasible resume for the user. In addition, the on-chain record in a DAO organization or project can be their resume on the chain too. To determine the quality and credibility of projects, many indicators can be referred to, including TVL, AUM, the partnership with other organizations or projects, profitability, whether they have been hacked, or other major events - such as whether the stablecoin issued has been terminated. All in all, the on-chain resume protocol can give birth to the capability evaluation system for individual users and organizations or projects, and matchmake or rank them by different needs.
(3) Launchpad, AMA and other distribution protocols
The distribution protocol is another appropriate use case for user profiles. The project providers can accurately locate and reach real potential users, and attract them with more inspiring incentives. Distribution protocol leaders like Launchpad. AMA and task releases such as TrustPad and Project Galaxy are indiscriminately addressed to all users, which will undoubtedly increase the costs and reduce efficiency because coupon clippers will just take the free ride throughout the process. But if the user profiles are created on the chain, the project providers set up a mechanism to screen interaction behaviors. In this way, they can locate more real target users at the same or lower cost. Users can also search for appropriate projects based on their own profiles, and make a difference in the infant project to maximize their earnings. This scenario is also how the resume protocol is applied to some extent.
(4) On-chain credit financial system
The on-chain user profiles embody the user's reputation and credit on the chain. Credit can’t be found in the current blockchain, so all financial behaviors are conducted on the excessive mortgage, or the operational scope of lenders must be limited by smart contracts. For instance, Aave and BendDAO run on excessive mortgage loans while Alpaca and Gearbox operate on leveraged loans. There is no exception. Those practices greatly reduce the efficiency of on-chain capital. As mentioned above, all on-chain user interactions have their intrinsic value on which a credit system can be produced for unsecured lending. In fact, this kind of loan is not necessarily completely unsecured. It can be a loan without collateral where only a certain amount is assigned based on the past behavior and existing status of the address; it can be a load with a slight adjustment to its original mortgage rate, or interest rate cuts; and it can also the loan with installment payment and the practice of buy now, pay later ( BNPL), etc; it can even be the guarantee loans for other addresses.
(5) Sound social credit system
The sound social credit system is exactly the final outcome that Vitalik Buterin expects to be generated by SBT. First, offline certification, such as an ID card, academic degree, or property certificate, can endorse the on-chain identity, and then the on-chain interactions build up the reputation. Thus, a sound social credit system combining the off-chain and on-chain elements comes into being to blend blockchain with real-world credit. Even though this system is a mature online identity solution, how to tie real-world identity to on-chain roles is still in the capacity of Web3.0 and it is not so crypto. It is a part of the final solutions though, and we believe that this system is a possible option for the on-chain credit system, and users can still choose the pure on-chain solution.
3.Conclusion:
In the era of the digital economy, it is said that user data on the Internet is a gold mine, and the dot-com process data to s add value. In the era of Web 2.0, user data is fragmented and companies hardly see the bigger picture. Besides, the data are owned by the platform, so the individual user has no access to the value increased by data processing. However, in the Web3.0 era, due to the nature of blockchain, footprints on the chain are owned by users, fundamentally destructing the data ownership structures. What’s more, to improve the reputation of their addresses, users are also willing to create their profiles on the chain. For protocol providers, wider user profiles can augment user growth and capture more value than the information island in the era of Web 2.0. Hopefully, the on-chain user profile promises the potential we are looking for in this field.
Source：
https://wrenchinthegears.com/wp-content/uploads/2022/05/Vitalek-Buterin-Soulbound-Token-Paper-May-2022.pdf
https://deepdao.io/people
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degenscore.com
arcx.money
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