NFTs as credentials (?)
As we saw in the previous article, there are different implementations and standards in the world of digital credentials. The idea of certifying one’s identity and competence with the digital signature of the issuer is undoubtedly very effective, especially when accompanied by a graphic aspect in the form of a recognition medal.
However, the use of a verification tool (which cannot be universal given the different implementations) is essential and preservation also requires the use of third-party applications.
So we might ask: What if we used NFTs as credentials?
Something belonging to an entity can be identified by either an NFT or a VC. The records of both are immutable (therefore secure), but there are significant differences. VCs use public-key infrastructure and digital signatures to prove a claim; they are not publicly viewable but are selectively shared with verifying parties as needed.
In a post titled “Where to use a blockchain in non-financial applications” Vitalik Buterin (Ethereum co-founder) said:
With off-chain claims, you can do *positive* reputation, because it’s in the interest of the recipient of a claim to show it to appear more reputable (or make a ZK-proof about it), but you can’t do *negative* reputation, because someone can always choose to only show the claims that make them look good and leave out all the others.
Some situations may benefit from this kind of transparency, and NFTs provide these specifics due to the fact that they are blockchain-based and time-stamped. The digital ownership and the origin of a token can be easily verified, and if you know the wallet address, you can see all the NFTs that someone owns and has ever owned.
Currently, VCs are the most practical technology to digitize our credentials and allow people to establish their identity on the Internet. While privacy and the lack of financial speculation are two major benefits of using VCs for digital identity, both factors have limited the social reach and adoption of the concept. As we can see, the search volume for NFTs is several orders of magnitude higher than for VCs.
| Keywords | Monthly search volume |
|---|---|
| nft | 1.830.000 |
| non fungible tokens | 60.500 |
| verifiable credentials | 8.100 |
| w3c verifiable credentials | 90 |
The great interest in this technology could prepare the ground for a real spread of digital credentials.
References
- Where to use a blockchain in non-financial applications - Vitalik Buterin
- WordStream used for keywords results