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Key Takeaways
- Of the five billion Internet users in the world today, 4.7 billion use social media. Thanks to these social networks, large quantities of personal digital information are being created on a daily basis.
- Privacy, security, and surveillance capitalism are common issues with Web2 social media platforms because they compromise the foundation of social networks: relationships (represented as social graph) and identity.
- The value of these centralised social networks is created by their unpaid users who worked hard building their online presence, which includes both their social graph and also their persona – not by the company itself nor its underlying technology. With this centralised model, monetisation potential stays with the entity that controls and owns the social data, which is the company instead of the user.
- The monolithic approach to data storage can make the platform become a single point of failure and potentially lead to huge amounts of data being compromised. Case in point: it was reported that social media leaks made up 41% of all data records breached in 2021
- The pain points are not isolated to end users either: this walled garden approach presents a high barrier of entry for developers, hindering the expansion of social networks, and ultimately the growth of the ecosystem
- A social graph refers to the global mapping of all users, which reflects individuals, their connections, and their interactions and behaviours towards others.
- Decentralised social networks present a universally accessible, unified, and decentralised social graph, acting as a standard that maintains users and all their social data across different platforms and networks.
- Lens Protocol is a decentralised, smart contract-based social graph which aims to empower profile owners to decide how they want to build their social graph and monetise their own content. It enables the formation of a fully composable, user-owned social graph by allowing users to own their connections between themselves and their network.
- CyberConnect is a decentralised, smart contract-based social graph protocol that enables ownership of users’ social identities, content, and connections in a social network, and provides a composable social data layer for developers.
- CyberConnect uses IDX, Ceramic’s cross-chain identity protocol which enables the creation of an identity index and keeps track of a user’s social information and activity. Through IDX, applications built within CyberConnect can access a shared, universally available identity layer, making it easy for them to integrate with other social applications. By leveraging the indexing capabilities of IDX, CyberConnect can combine existing social graph data from different sources.
- Compared to traditional identifiers, decentralised identifiers are different in that they are owned, held, and controlled entirely by the individual.
- The global decentralised identity market value is estimated to reach US$6.8 billion by 2027.
- Today this is mainly materialised through Soulbound Tokens (SBTs), or non-transferable and non-tradeable NFTs containing verifiable information that’s unique to its owner. We can see their practical applications in the market today: For example, Binance offering Binance Account Bound (BAB) Tokens which serve as proof that its users have passed KYC, Otterspace empowering DAOs with the issuance of non-transferable badges, and Masa launching the first SBT single sign-on for Web3 applications.
Read more about SBTs in our report: Soulbound Tokens & Decentralised Society
- Cronos ID is a decentralised identity and communication protocol, offering NFT domains with a ‘.cro’ extension, making it easy for users to transfer digital assets without having to worry about non-readable wallet addresses. It designed to be a key infrastructure layer, and the Domain Service is only the first step in building the infrastructure groundwork for Web3: it will also release Cronos ID Notification Service, a subprotocol which will allow users’ wallet addresses to receive on-chain event notifications, and Cronos ID Messaging Service which will enable communication between users via their wallet addresses or domain names.
Read more about Web3 identity solutions in our report: Digital Identity in the Web3 World
Read the full report: Social Graph and Digital Identity in Web3
Authors
Crypto.com Research and Insights Team
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