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Reputation is Contextual
Why a bottoms-up approach for reputation and identity is needed
When thinking through how decentralised reputation and identity works, one critical distinction that needs to be made is that reputation is contextual. What does that mean? Well let’s look at how people and society work in their current form.
People are multi-dimensional in who they are. You have who you are with your:
Degens on Telegram
The list goes on and on. The one thing that is clear is that who you present yourself as and how you present yourself can change greatly depending on who the other person is and the context you’re communicating in. How you present your online identity on LinkedIn is very different from the way you present yourself on Instagram.
Given the assumption that one “identity” can have many “reputations” to different people is critical. Since it means that you can have someone who is:
An amazing friend and terrible father simultaneously
A normal, well-behaved brother but a ridiculously massive degen in the cryptoverse
I mean you probably get the point of what I’m trying to say here. You can’t one-size-fits-all people.
Why this matters
Bringing this back to relevancy with crypto. Your wallet or wallets are basically fragments of your identity and the actions you perform on them help solidify a vector of reputation within your identity. I know that sounds a bit abstract but let’s use some concrete examples for this once again. You can have the following wallet setups:
The One-In-All Wallet: your public ENS tied to this, all your on-chain wealth stored in a single place and all your behaviours in this one wallet. Terrible from a privacy perspective but you don’t care because you can farm clout with this wallet.
The Personal/Public Wallet: you have one ENS-tied wallet where you want to show things that you do publicly but also probably keep it as a hot wallet so you can try stuff out with. It also helps you farm some CT clout but you’re conscious of what you put on it. Your other wallet is where you deal with all your more private transactions (storing the majority of your wealth).
The Wallet-For-Everything Wallet: you have a wallet for virtually any new use case. In this universe, anytime you do something new/unique on-chain you’ll create a new wallet that has no ties to past wallets in order to preserve your privacy from anything on-chain and off-chain. Funds and high-net-worth individuals typically end up going down this path.
Of course, there are some oversimplifications made with all of this but hopefully you get the idea that your identity can be sharded over many wallets based on the reputation each wallet accumulates. You can aggregate all reputation on one wallet or split it across numerous ones.
So what can the reputation for each of these wallets be? Well you could have wallets that have distinct reputations:
Dumps all DeFi yield farmed tokens, keeps all Web3 airdrops
Borrows extremely well on MakerDAO, complete degen on CREAM
Never sells tokens received directly from a DAO, day trades SHIBA all day
Just like our real-world reputation, our crypto native reputation is different to each contract and token combination. Trying to create a “one-size-fits-all” approach just doesn’t work in crypto, not just philosophically but also technically.
Let’s say you want to create an “Airdrop Score” that measures how long someone has held an airdrop for on average. Great. Now here’s what you need to do:
Track each and every airdrop that has happened
Find the contract addresses and events that track how the airdrop was executed technically
Find where the tokens can be staked, LPd or borrowed
Double check to make sure you didn’t get a single thing from the above wrong since you’ll mis-quantify a user’s reputation
Reputation is not top-down or one-size-fits-all. Thinking so means one hasn’t realistically thought of the challenges in this space.
To make reputation in Web3 real, we need to create many dimensions of reputation that are contextual. Only then can we aggregate.
PS: if you enjoyed this piece, let me know!