Vitalik Proposes Web3 Credentials of the Future: ‘Soulbound Tokens’

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May 25, 2022 Blockchain, Crypto, Digital Assets, Tokens, Meta, NFTs, Digital Identity, FinTech and Alternative Finance, Innovation and Resources, Voices No comments

The Defiant | Jason Levin | May 25, 2022

Soulbound tokens - Vitalik Proposes Web3 Credentials of the Future: 'Soulbound Tokens' Ethereum creator Vitalik Buterin recently proposed a new kind of token standard that will help users gain insights into others’ real-world activities, accomplishments, likes and dislikes – something like a glimpse into their soul.

Buterin’s soulbound tokens (SBTs) are non-transferrable NFTs held by unique crypto wallets called Souls. In the paper Buterin co-authored to introduce the concept, he described multiple ways SBTs could be used – as university degrees, education credentials, and as web3 credit scores.

See: Interview with Idris Mootee of urbancoolab: Creative collaborations between Humans and AI Machines

Instead of a web3 hiring manager calling up your alma mater or checking LinkedIn, he could check your on-chain resume for a transaction showing the university’s Soul transferring you an SBT. SBTs have the ability to decentralize power away from major institutions and companies and towards the users – instead of a private database owning your credentials, you would own the keys to your credentials.

Vitalik Buterin: Souls can encode the trust networks of the real economy to establish provenance and reputation.

On-chain credentials are already being used by companies like 101 and RabbitHole. Ben Yu told The Defiant that his team at Curious Addys will soon be using SBTs for their web3 Q&A platform Curious.xyz to help users build on-chain reputations for answering questions.

Privacy and Free Speech

Beyond issues with spam and private key protection, having key aspects of people’s identity exposed in a public blockchain sounds like a privacy nightmare, said Richie Bonilla, founder of DAO dashboard Clarity.

See: Modernizing Privacy Law in Canada – Striking the Right Balance

Some went as far as to suggest that SBTs sound like the social credit system adopted in China where all citizens get a score that fluctuates based on their behavior. The dystopian scenario could emerge in a far-flung situation where SBTs are used for every aspect of online life, and not just for web3 credentialing.

“You don’t want everyone to see every facet of your identity,” Bonilla said in an interview. “What about persecuted groups?” Bonilla asked. If you go to a religious conference that gives out SBTs, could you never hide your religion?

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