What Is Digital Identity in the Metaverse?

Table of Contents

1 What Is the Metaverse?
2 What Is Identity?
3 The Three Pillars of Identity
4 Anonymity and Pseudonymity
5 Importance of Pseudonymity
6 Pseudonymity in Internet and Web3 Communities
7
8 Identity in the Metaverse
9 The Future of Identity in the Metaverse

The metaverse, first coined by Neal Stephenson in his cyberpunk novel Snow Crash, refers to a series of interconnected virtual reality worlds that function as the Internet. In these worlds, users can interact, game, and experience activities as they would in the physical world. This concept was first explored by William Gibson, who called it cyberspace, in his book Neuromancer. These synthetic worlds use avatars and pseudonyms to represent people, as seen in popular movies such as Ready Player One.

However, some people may be confused about identity in the metaverse. They might ask, what does identity mean in this context? After all, isn’t the metaverse solely about avatars and pseudonyms?

To answer this question, we need to understand first what the metaverse is and what identity truly entails.

What Is the Metaverse?

A Metaverse is a collective virtual space, combining augmented reality, virtual reality, and the internet. In this digital world, users connect with each other and digital surroundings through avatars. This allows for immersion, connection, and creativity. This vast digital environment blends real and virtual worlds. It enables users to engage in social interactions, games, commerce, and more. As the metaverse grows, it raises questions about identity. Users must navigate self-expression and privacy in this expanding digital world.

What Is Identity?

“The chief principle of a well-regulated police state is this:
That each person shall be at all times and places… recognized as this or that particular person.”

Johanne Gottlieb Fichte (1796)

Identity is what distinguishes us as individuals. It’s like a personal tag that helps others recognize us. Just as we use money to trade for things we want, we use our identity to present ourselves to the world.

In his book, Identity is the New Money, David Birch explains that there are three types of identity: personal, social, and legal. These identities are not set in stone; they change and evolve throughout our lives. However, it’s important to note that these identities are distinct from each other.

The Three Pillars of Identity

Our identity is made up of three main parts: personal, social, and legal. Each of these parts plays a significant role in how we see ourselves and how others see us, whether in the real world or in a virtual world like the metaverse. Let’s look at the three kinds of identity:

Personal Identity

According to Psychology Today, identity consists of memories, experiences, relationships, and values that contribute to one’s sense of self. Despite adding new facets daily, this allows you to establish a steady sense of yourself over time.

As people constantly cultivate their visible identity: clothing, shoes, hairstyle, hair color, makeup, jewelry, and more, personal identity is one of the most cultivated components of their lives. On a daily basis, how many people obsess over their outfits? And why do they do this, because they want to ensure that their look aligns with their personality in an outward-facing way. Why? It is because people judge others by their outward appearance and use that judgment to bring like-minded individuals together. This is how many people find their tribe.

But these personal identities change over time. In my teens, my identity centered on skate and surf culture, evident in my appearance. As I grew older, Harley Davidson motorcycles became my primary identity. I always carried something related to HD. Having those personal identities helped me meet like-minded people. They later became close friends, fostering honest value exchanges.

Additionally, sometimes what you wear doesn’t just reflect your personal identity but also telegraphs your social identity. For example, what does wearing a MAGA (Make America Great Again) hat express about your social identity?

Social Identity

Your social connections represent your social identity: clubs you join, political affiliations, interests, hobbies, and possessions. Some clothing displays personal identity, while other clothing choices might represent a broader social identity.

But not all of your social identity can be tied to an article of clothing. Sometimes, it is more about who you associate with and what you own, like a car or an NFT. Many people view social identity as something that can be bought. For example, people love the Bored Ape Yacht Club (BAYC) community so much they are willing to pay a premium to join it. So that right there is social identity.

Social identity is built up through so many things. For example, it can be pulled from social sources such as LinkedIn (for the companies you’ve worked for), GitHub (for the code and repositories you’ve worked on), Discord (projects you align with), Twitter (for whom you are connected to), and Udemy (for your studies).

In Identity is the New Money, when discussing social identity, David Birch writes, “Identity is returning to a concept built on networks, rather than index cards in a filing cabinet.”

Legal Identity

How would you describe your legal identity? Is it your driver’s license or your passport? Is it your birth certificate? Or is it about the way you look? The United Nations defines your legal identity as the basic characteristics of an individual’s identity. e.g. name, sex, place, and date of birth conferred through registration and the issuance of a certificate by an authorized civil registration authority following the occurrence of birth.

The three key components of a legal identity are descriptive, locational, and civil:

Descriptive. These are descriptions of you, such as your hair color, eye color, height, etc. Additionally, fingerprints and pictures are often taken as biometrics.
Locational. Your place of birth and where the document was issued.
Civil. Who registered and attested to your birth, and therefore, your identity.

While other aspects of your identity evolve and change over time, these legal aspects tend to stay fixed.

People often need a legal identity to perform certain activities worldwide, but the requirements vary from place to place. For instance, some countries enforce age restrictions for viewing pornography, ordering or consuming alcohol, or gambling. And over 200 countries/jurisdictions have enabled the Financial Action Task Force (the global money-laundering watchdog) to require that cryptocurrency transactions be associated with legal identities. The region where you live determines what you can and cannot do online.

In the metaverse, nothing changes from the perspective of legal identity. Many in the Web3 and Metaverse communities want to remain anonymous. The better choice for individuals and the industry is to be pseudonymous.

Anonymity and Pseudonymity

One of the most beautiful things about the Internet is the ability to be anonymous. Being anonymous is considered to be necessary for freedom of speech, but in reality, it is very liberating. Due to cancel culture, people fear speaking their truth, avoiding rejection from the mob. Building a stellar reputation takes years, but one wrong statement can destroy it in seconds.

On the other hand, interacting with people on the Internet can be problematic. People are bullied or become bullies when they are anonymous. Why not? After all, “On the Internet, nobody knows you’re a dog.”

This cartoon, circa 1993, was published in The New Yorker right before the World Wide Web was created and years before billions of people got online and learned what this truly meant. On the Internet, it appears that trust is hard to find. And this will remain true for the metaverse.

Importance of Pseudonymity

For many, pseudonymity solves this problem. In pseudonymity, individuals fully identify themselves to a service (KYC or Know Your Customer) and link it to reputational partners such as LinkedIn, Twitter, and GitHub. However, they are only ever known by their pseudonym. Nobody but the underlying individual knows their true identity, and reputation can be a signal of trust in that individual.

A pseudonym is not a new concept, nor does it only occur on the Internet. Artists frequently adopt pseudonyms, such as writer Samuel Clemens, who is better known as Mark Twain. Similarly, musician Stefani Joanne Angelina Germanotta is widely seen as Lady Gaga, while Norma Jeane Mortenson is famously known as Marilyn Monroe. The use of pseudonyms, pen names, and screen names has been around for hundreds of years.

Pseudonymity in Internet and Web3 Communities

There are many reasons why someone might want to use a pseudonym when interacting online. For many, this is a way to provide protection when exercising their freedom of expression. Consequently, they can share their genuine beliefs without facing ostracism from others. Others use this to hide their religion or race online to reduce bullying or harassment. Additionally, some might want to disguise their gender when applying for jobs in the tech sector, as women are significantly underrepresented in the tech sector.

In the Internet and Web3 communities, pseudonymity is used in varying degrees, and is frequently seen on Twitter, Discord, and other platforms. While Elon Musk tweets under his real name, thousands of others tweet under a pseudonym. Then you have companies like Yuga Labs (the producers of the Bored Ape Yacht Club) that work entirely under pseudonyms (the founders are Garga, Gordon Goner, Sass, and Emperor Tomato Ketchup). And this is just the beginning.

Identity in the Metaverse

People who are overly concerned with the impression they make can struggle acutely with their identity. Similarly, those who feel a core aspect of themselves, such as gender or sexuality, is not being expressed may also face identity challenges. Reflecting on the gap between our current and desired selves can be a powerful change catalyst.