Decentralized Identities Will Be The Most Transformative Aspect of Web3 Gaming

Few industries have been impacted more by the rise of Web3 technologies than video games. The emergence of blockchain games has captivated millions of players globally with the promise of giving them full ownership of their assets and even better, the ability to win cryptocurrency rewards for completing challenges, beating their opponents, and conquering new frontiers. 

Within the Web3 gaming industry, one of the most critical developments is the idea of a decentralized or self-sovereign identity, which puts power into the hands of gamers. A decentralized identity can be thought of as a unique, verifiable, self-owned and privacy-preserving identifier that eliminates the need to register with gaming service providers. 

The main premise of decentralized identity in gaming is that players will be able to carry their identities, reputations, experiences and achievements across every game they play, keeping it in a cryptographically secure and personal vault that contains all of their gaming information. It’s a groundbreaking concept that opens the door to new levels of privacy, security, and personalization. 

NFTs: The secret to player empowerment 

Decentralized identities take the shape of non-fungible tokens, better known as NFTs, which provide a way for users to safeguard and own their personal information in the digital realm. They give video gamers unprecedented control over their data and their digital assets, even going so far as to allow them to extract value from their gaming experiences. 

One of the most popular decentralized identities in Web3 gaming is CARV ID, created by the CARV Protocol. CARV IDs are issued to users as NFTs based on the new ERC-7231 standard, and give gamers a way to aggregate all of their gaming credentials across every game they play, including both Web3 and Web2 games. This includes their usernames, their gaming histories and data, their achievements, the assets they own, their social connections and more. 

CARV IDs are really Soulbound Tokens, a special kind of non-transferable NFT that remain in the digital wallet where they’re first minted. Because they cannot be transferred, it’s impossible for someone to assume the identity of another player. 

One of the best things about SBTs is that they can be used to validate someone’s identity. When creating their SBT, the user can undergo a verification process with a third-party provider that validates their identity and issues a certificate proving they have done this. This can then be used to pass verification checks with other games and decentralized applications without revealing the identity of the individual. 

With their CARV IDs, players can prove their credentials on one game to users on any other game in the CARV Play ecosystem without revealing any personal information. They do this by linking their various game profiles to their CARV ID and importing their game histories into a single identity that can be used on any blockchain network, enabling cross-chain gaming. The beauty of this design is that the player’s CARV ID will be continually updated as they progress and tick off new achievements in the games they play. 

True asset ownership

Perhaps the biggest advantage of a decentralized identity for gamers is asset ownership. In traditional video games, players can obtain various assets such as new character skins, weapons and vehicles, but they don’t truly ‘own’ these things, as they can only use them in the game where they acquired them. That’s why Web3 is – quite literally – a game-changer, as it enables players to fully own the various assets they acquire. 

With Web3 games, game characters, weapons, vehicles and so on can be represented as NFTs, which means the player who owns it is free to sell it on the open marketplace or transfer it to another player as a gift. This allows players to recoup the value of their investments in a game. Say you invest $10 to buy a weapon as an in-game purchase. Once you no longer wish to play the game, you’ll be able to sell that weapon to someone who wants it. 

Another advantage is that in-game assets can be transferred to other games. These kinds of capabilities amplify the possibilities for player engagement and developer collaboration, paving the way for more personalized experiences and better rewards for players. 

Player-Owned data monetization

Another key element of decentralized IDs is that they enable true data ownership, which in turn opens the door to the possibility of players monetizing that information. 

Because players control their decentralized identities and the data within them, they have the ability to selectively share some of their information with third-parties, such as game developers, advertisers and even artificial intelligence companies, if they wish. Players can share whatever they like, with whoever they want, and also revoke access to their information at any time. 

This aligns with the principle of privacy-by-design and can help to foster a new level of confidence and trust within the gaming industry. 

As an example, CARV allows anyone with a CARV ID to opt into its “Lifetime Membership of Passive Income” program. In doing this, players agree to share their gaming histories with CARV’s network of games developers and advertisers. Developers will use the data to target players who are likely to find their new games appealing, while advertisers will be able to show gamers ads for products and services that are more likely to interest them. In return for sharing this data, gamers will receive regular rewards in the shape of cryptocurrency tokens that can be used for in-game purchases or sold for real money on a crypto exchange. 

Next level security

In addition to asset and data ownership, decentralized identities also come with significant security benefits for gamers. One of the most critical is that they eliminate the risk of a single point of failure. 

Centralized gaming platforms can be vulnerable to cyberattacks and data breaches, and if a game is hacked, the player’s personal information and even their payment details can be exposed and exploited. The risk becomes exponentially greater the more games you play, as players are required to register and provide such details with each one. But Web3-based identity protocols provide a compelling solution. 

Because decentralized identities are secured by blockchain, it means that the players’ information is spread across a network of nodes, which means there is no more single point of failure. Player’s data is also secured cryptographically, and so even if a hacker does manage to obtain it, they won’t be able to unscramble that information and exploit it. It also engenders greater confidence in player’s identities, because blockchain is inherently tamper proof. 

Decentralized identity as a badge of honor

Decentralized identities in gaming provide some immense benefits, and there are no apparent disadvantages to the concept either. However, there are a few hurdles that the industry must overcome for this new method of verification to become standardized in gaming. 

For one thing, widespread adoption requires broad consensus – simply put, the industry needs the biggest developers to sign up to the idea and ensure decentralized identities are compatible with their games. There’s a requirement for more standardization across platforms, and the ever-present regulatory concerns around all things blockchain provide another obstacle. What’s more, the technology itself is still nascent, with ongoing refinements being made to improve user experiences and scalability. 

The good news is that none of these challenges are insurmountable, and there is growing enthusiasm for decentralized identity in the Web3 gaming sector. Blockchain gaming is evolving rapidly and well on the way to delivering a more open, immersive and secure gaming universe that puts the players in control, enabling better experiences. 

Web3 gaming represents a world where players are no longer seen as consumers, but as active stakeholders who participate and share ownership of the games they love. It’s a world where gaming experiences no longer happen in isolation, but instead take place in a much wider and more connected digital realm. 

Players will, at least, truly own their achievements and assets, and their identities will serve as a badge of honor that spans the entire gaming universe.