Masa Finance launches soulbound Web3 identity protocol for Ethereum and Celo
According to a press statement shared with Cointelegraph on Jan. 17 by Masa Finance, the first soulbound identity protocol for the Ethereum mainnet has just been released. The protocol will enable the issuance of standardized soulbound tokens for Know Your Customer (KYC) verification, credit ratings, and other use cases on Ethereum.
Tokens that are soulbound cannot be moved from one wallet to another. The idea gained popularity after Vitalik Buterin suggested in a blog post that these tokens may be used to represent governance rights for decentralized finance (DeFi) protocols or to demonstrate that a person has attended an event that they have actually attended.
Brendan Playford and Calanthis Mei, co-founders of Masa Finance, stated that soulbound tokens will increase the prospects for DeFi users to establish credit and obtain loans in an interview with Cointelegraph. Mei described it as follows:
“We want to help people tap into [an] on-chain credit system with a Web3 credit score, with the data sources that we have aggregated across Web2 and Web3 representing and helping people build their creditworthiness on-chain. We’re currently working with multiple lending partners in extending DeFi loans to those individuals who have minted a Masa credit score report.”
These soulbound tokens are not just linked to a standard credit score, she emphasized. The protocol incorporates Web2 and Web3 activity in addition to conventional finance. Mei said that more than 10,000 data points, including a user’s FICO score, Plaid transaction data for credit and debit cards, Web3 wallet transaction history, centralized exchange balances, and other information, are combined to create a Masa credit score.
Mei thinks that this method will enable “risk-based underwriting” in DeFi, which she claims was previously impossible since blockchain networks lacked identity protocols.
The protocol currently has two further use cases, according to the protocol’s creators. The second application for the protocol is the representation of .sol domain names in addition to credit scores. They are comparable to ENS names with the advantage that they can be connected to different Masa identification traits. Users can link various attributes, use a pseudonym to identify themselves, and demonstrate their Web3 verification without disclosing their full name, for example, according to Playford.
Playford made note of it that, .sol domain names can be moved from one wallet to another. If the domain is relocated, though, the attributes connected to them will separate. Users are unable to “purchase” another person’s identity or credit score as a result.
Identity verification, a function the business released under the moniker “Masa Green,” is said to be the third use case. It enables users to create a Masa Green token as identification, which the business hopes will assist users demonstrate that they are actual people, not robots. Mei claims that this will aid in the elimination of bots from play-to-earn games and other applications where the community only wants real people to take part.
The soulbound token protocol Masa is not the only one used on a blockchain network. A version that can be used to verify a user’s identity has been made available by Binance under the name BAB. BAB, however, is only presently accessible through BNB Chain. On both Ethereum and Celo, Masa appears to be the first cross-chain soulbound token protocol.
