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Digital Identity Value in the Web 3.0 World

October 13, 2022

7 min

Digital Identity Value in the Web 3.0 World

The term Web 3.0 (or web3) refers to the next iteration of the Internet. However, before we dive into the definition of web 3.0 and 2.0, and discover what digital identity is, it is important to take a step back. Let’s find out how the Internet has evolved over the years and how this has affected our lives.

Web 3.0 and Web 2.0: how digital identity is changing

From read-only to interaction in Web 2.0

The original Internet, Web 1.0, was primarily an information portal where users were mere receivers of resources. Sites contained static pages that were rarely updated and based on a system of hyperlinks. Web 1.0 is also commonly referred to as the ‘read-only web’ because it did not include all the interaction features we are used to today.

As technology evolved, Web 2.0 conveyed the tools to easily participate in the internet instead of being mere passive readers. First forums, then blogs and finally social media have given everyone a voice. Content creators are no longer just programmers or specialised companies, but any user can create content one in one way or another. In parallel, fundamental technologies such as apps and smartphones have evolved, making everything easier and more accessible for both users and programmers. Today, each of us has dozens or often hundreds of digital identities with associated names, images, and different content ; but what actually is your digital identity? In Web2, your accounts on every website, social media platform, messaging app, video game or e-mail address are an instance of your ‘digital self‘. This fragmentation of digital identities can be a source of confusion, risk and, more generally, a poor user experience.

If you want to change your display name or profile picture, for instance, you have to do so on each individual account. Although we have created all these versions of ‘digital selves’, we are not actually the real owners of these entities. Personal data associated with our accounts and the content we generate are owned and controlled by the companies that build the platforms we use (more on this in the article about cloud storage). These platforms can censor our activity or make old content unrecoverable according to their algorithms.

The definition of Web 3.0 describes a new, decentralised version of the Internet in which we (as users) completely own and control our own personal data, our digital assets and our digital identity. In addition to watching and creating, we can also be in control. This is possible thanks to blockchain technology and NFTs in particular.

Web 3.0 or Web3?

The expressions Web 3.0 and Web3 are used here as synonyms, but actually refer to two different ideas of the evolution of the Internet. Web 3.0 is the formula proposed by Tim Berners-Lee in 1999 to refer to the concept of a semantic web, a form of the WWW in which all information can be processed by computers, which will become ‘intelligent agents’. The term Web3, on the other hand, was coined by Gavin Wood in 2014 to refer to the integration of the Internet and blockchain. We do not yet know whether only one or both of these forms will come true.

How is digital identity conceived in Web 3.0 and how can we create one?

Projects such as Unstoppable Domains are building Web3 domains that can become a fundamental part of your online identity during this evolution towards Web 3.0. A Web3 domain, in its simplest form, is a name (for example: unstoppable.nft) that exists as an NFT on the blockchain. First of all, this allows the domain’s owner to have all the data associated with it under their direct control and to be able to use it as a digital identity across the entire web. These use cases can be summarised in two fundamental concepts: data sovereignty and data interoperability.

The Web3 opportunity: data sovereignty

Having data sovereignty means that you, and only you, have the right to decide who or what entity can access your data, as well as what data you want to share with certain apps and how it is used.

Think of your Facebook account. Finding out what data is being collected, for what purpose and how to opt out of sharing certain data is akin to trying to find your way out of a maze. It should be simpler than that.

This is the mission of crypto Web3 projects such as Unstoppable Domains: to start enabling sovereignty over your digital identity, to give you control over your data and resources every time you use them online. All this (and more) is possible with Web3 domains on blockchain. Once you own a Web3 domain, it is your digital identity identifier, which belongs exclusively to you. Not even Unstoppable Domains can take it away from you.

The need for Web3: data interoperability

When you can use your digital identity everywhere, it means that your data is interoperable. Imagine being able to use the same NFT on any marketplace, game, application, and even on different blockchains.

In Web2, it is difficult, if not impossible, to move data from one app to another. This is because big technology companies have created closed ecosystems. For example, we can publish the same content on all Meta services or use the same account for all Amazon services, but using the same content or credentials on both is impossible.

The definition of Web3, on the other hand, is based on content sovereignty and interoperability. There are no companies asking for data in exchange for services, but instead developers who create services and users who use them and pay for them without relinquishing control of their data. All this is possible thanks to the blockchain, which through cryptography makes the ownership of all kinds of tokens immutable and secure. Smart contracts are essential for Web3 too, as they make it possible to build decentralised applications (DApps).

Log in with your Web3 domain

Login with Unstoppable“, the first single-sign-on service built on Ethereum, is designed to enable use of a single blockchain account while accessing Web 2.0 and 3.0 applications. This service enhances your Web3 domain, because it gives you control over the personal data you share with sites and apps.

Wallets are great for storing crypto, but if the same owner has more than one wallet (perhaps even on different blockchains), they cannot use them together and their ownership is not registered anywhere. On the other hand, Web3 domains support on-chain data such as wallet activity, and off-chain data such as email addresses. This way, you can associate all your wallet addresses with one Web3 domain and build your digital identity in Web 3.0.