DNA Passport Research Report: The Vanguard in Physical NFTs and DID Track

Key Points

  DID stands for Decentralized Identity, which is a digital identity that does not require centralized institution verification, giving users the opportunity to take control of their rights. Currently, the main problems DIDs aim to solve are ownership issues (management of user data and identity) and the absence of native Web3 identities. To address these issues, several projects have attempted solutions from various angles based on different user needs in specific scenarios, broadly classified into on-chain identity verification, off-chain identity verification, and hybrid on-chain/off-chain identity verification. However, DID development is still in its infancy, with no DID system yet achieving significant network effect. Consequently, this track has garnered considerable attention. DNA DAO will launch its DID product, DNA Passport, by the end of 2023. Following the introduction of the AI intelligent microscanner, DNA DAO's physical copyright system will evolve from a centralized platform to a decentralized protocol. What problems does DNA Passport solve? How is DNA Passport related to the latest AI intelligent microscanner? Why is DNA DAO launching DNA Passport? Additionally, with DID tracks represented by Bright ID, POAP, Gitcoin Passport, and Galxe Passport actively progressing, how does DNA Passport differ from them, and what impact will it bring to the industry? This report analyzes these questions.

Background

  DNA is a physical authentication and authorization platform launched in April 2019, initially aimed at better addressing the blockchain's real-world application challenges. Due to technological limitations at the time, most connections between blockchain and physical entities involved attaching QR codes or chips to products. This method of linking blockchain to physical objects was easily forgeable, leading many to consider blockchain certification and traceability a fallacy. Dr. Cheng Xi'en, who had been researching blockchain for many years, analyzed the situation and concluded that blockchain traceability remained an unresolved scientific problem, which he then began to study. Since 2018, DNA DAO has independently developed an AI intelligent microscanner, overcoming three key challenges: positioning, extraction, and identification. Using an integrated microscopic device, it collects unique identifiers of physical objects and secures artwork identity information on the blockchain, ensuring data integrity and traceability. As of November 2023, DNA DAO has collaborated with two institutions: the Nanchang City Museum and the China Customs, assisting in the authentication and authorization of countless artworks and antiques, winning over ten national awards such as the China Innovation Award and the China Maker Award.

DNA Passport

DNA Passport Introduction:

  DNA Passport is an online + offline identity aggregation dApp built on the Ceramic Network. Users can collect various identity proofs called stamps from both Web2 and Web3 identity verifiers, including Google, Facebook, Bright ID, ENS, and Proof of Humanity. Passport aggregates stamps and chains user-provided real-world authentication information offline. For example, Li Lei provides his identity information offline and aggregates various online identity verifiers through his wallet on-chain. Users can identify the information associated with a wallet address.

Features of DNA Passport

Autonomy of Information：

  Users can verify their personal identity information, WEB2 account information, and WEB3 information through open network standards like DID and VC. All information in a user's Passport is subject to user modification, addition, or deletion.

Cross-Chain Verification：

Validates data across multiple blockchains to obtain composable, interoperable identities. This means owning a DNA Passport is equivalent to having a Web3 network pass.

Technical Implementation of DNA Passport

   DNA Passport is developed as an identity verification application on the Ceramic blockchain network. Ceramic is an off-chain sovereign data network that maps decentralized identifiers (DID) to user-controlled data streams. Data on Ceramic is public, permissionless, and verifiable, unlocking access and interoperability among all platforms and services on the network.

  The DNA Passport SDK consists of a set of databases available on NPM to help developers interact with Ceramic Passport data:

@DNA/passport-sdk-writer – Writes authenticated DIDs Passport streams in Ceramic.

@DNA/passport-sdk-reader – Reads from any Passport stream (on Ceramic).

@DNA/passport-sdk-verifier – Verifies the content of the Passport. 

@DNA/passport-sdk-types – Shared types.

Anyone can read data on Ceramic by knowing a user's blockchain address, DID, or Ceramic Stream ID, allowing access to Passport information. However, only the user can write data to their Passport. When a user signs a message with their wallet to grant access (e.g., when connecting to the DNA Passport application), they grant the application access. Passport requires a unique wallet signature for write operations, only requested by applications intending to write to the user's Passport.

Why DNA DAO is Launching Passport

Ownership Issues:

The internet lacks a native identity layer, resulting in websites and apps issuing digital identities. This siloed approach might have worked in the early internet days, but with billions of netizens today, its limitations are increasingly evident. Creating usernames and passwords has become the mainstream identity proof method, despite its growing recognition as an insecure model. Managing an increasing number of passwords inevitably leads to a poor user experience. More importantly, users do not own their online identities but rent accounts from companies or centralized entities, making online identities susceptible to unauthorized access, manipulation, censorship, or loss.

Absence of Native Web3.0 Identity:

 "Currently, Web3.0 is more about expressing transferable, financial assets rather than coding social trust relationships. However, many core economic activities, like uncollateralized loans and building personal brands, are based on enduring, non-transferable relationships. In less than a decade, Web3.0 has created an unprecedented, flexible parallel financial system, bringing a complex and open ecosystem to financial transactions, where economic value is generated by humans and their relationships. Web3's lack of a foundational element to represent social identity fundamentally relies on the centralized Web2 structures it aims to surpass, thereby replicating its limitations." - "Decentralized Society: Finding the Soul of Web3"

DNA Passport's Differences and Connections with Competitors

  Several projects have attempted to address the issues mentioned above based on different user needs in specific scenarios, broadly classified into on-chain identity verification, off-chain identity verification, and hybrid on-chain/off-chain identity verification.

-Off-chain identity: Represented by Bright ID, it authenticates real people through Zoom online video meetings and requires adding at least two Bright ID friends for future identity recovery.

On-chain identity: Represented by POAP, it issues non-transferable NFTs to event attendees (accounts) as identity proof.

Hybrid identity: Represented by DNA Passport, Gitcoin Passport, and Galax Passport.

DNA PassPort、 Gitcoin Passport 和Galax Passport

  The major difference between DNA and Gitcoin lies in whether identity information is public. After uploading identity information on Gitcoin, it scores users and chains only the score, still unable to address the anonymity issues faced by users in participating in core social activities or building personal brands.

  DNA's most significant difference from Galax lies in its multi-dimensional information aggregation and reputation-based multi-center off-chain information verification. Both utilize aggregated on-chain and off-chain identity information and off-chain KYC verification. The difference is that DNA incorporates more dimensions of information, allowing users to decide what information to upload voluntarily without mandatory requirements. Off-chain KYC verification is performed by multiple reputation-based multi-center service providers, ensuring the correctness and security of user information

Impact of DNA Passport on the Industry

Developers

Built on web standards such as ERC-721 and the upcoming W3C DID/VC standards, DNA Passport enables developers to utilize its JS SDK + Solidity SDK on their platforms. With just one line of code, developers can verify the specific real-name information of an account.

Users  

DNA Passport allows users to collect "stamps," aiding others in better understanding them. The more stamps a user collects, the more information about themselves they can display to others, facilitating their participation in core online economic activities. They will benefit from other outstanding dApps that use DNA Passport.

Traditional Identity Solution Providers

  In the short term, the entire DID (Decentralized Digital Identity) track is still in the exploratory phase, posing no immediate threat. However, in the long term, the development of the DID track complements the proliferation of Web3 applications. It's hard to imagine a non-crypto user adopting a decentralized identity for no apparent benefit. As Web3 applications gradually infiltrate the lives of the general public, it's believed that DID will gradually replace the market for traditional identity solution providers. For DNA Passport, the experience gained in future iterations of application scenarios such as minting NFTs to declare origins or financial lending will also benefit its ecosystem partners like Bright ID, fostering mutual growth and offering users improved internet identity solutions.

If everything goes smoothly, DNA Passport will create a network effect as follows:

1.More users utilizing more dApps create more utility ("minting NFT to declare origin, querying NFT origin"). 

2. More "stamps" create more utility for users/dApps integrating Passport ("stamps"/minting NFT). 

3. More dApps create more utility ("stamps"/minting NFT), attracting more users.