Ethereum (ETH) co-founder Vitalik Buterin has been quite vocal recently about the non-financial applications of blockchain technology and has published a paper on June 12 listing some use cases.
In a paper titled “Where to use a blockchain in non-financial applications,” in the first place, the Ethereum mastermind said one of the biggest challenges in a cryptographic account system is the issue of private key changes.
He argued that a use case of blockchain can be in “user account key changes and recovery.”
Per Buterin, the “Decentralized Society” (DeSoc) paper he co-authored, which explores the idea of non-transferable Soulbound Tokens (SBTs), suggests “to preserve non-transferability, social recovery (or “community recovery”) of profiles” that can solve this issue.
A second use case for blockchain can be in “modifying and revoking attestations.” Buterin claims that issuing a digital record completely off-chain or on-chain using non-fungible tokens (NFTs) would make it hard to modify and revoke when the need arises.
“So instead we can go with a hybrid solution: make initial degree an off-chain signed message, and do revocations on-chain,” he said.
He also noted that this is the approach that is already used by OpenCerts, a blockchain platform that generates cryptographic protections for educational credentials.
Another example of where blockchains are valuable in non-financial stances is in “committing to scarcity.” In simple terms, blockchains can be used to identify whether an attestation has a provably limited quantity or not, which can then affect the effectiveness of that attestation – i.e., the more limited, the more valuable.
Blockchains are also powerful since they create “common knowledge,” meaning they can enable participants to access on-chain data and also know who else can access it. This makes coordination among many parties more feasible.
Another potential use case that Buterin discussed was open-source metrics, a concept still in its infancy that would allow diversity and decentralization to be measured.
“An ideal voting mechanism would somehow keep diversity in mind, giving greater weight to projects that are supported not just by the largest number of coins or even humans, but by the largest number of truly distinct perspectives,” Buterin said.
Buterin also noted that one “controversial” use case for blockchains is for storing data. He said that since there are other tools for storing data that can better honor user privacy, there is not much need for blockchains. Still, there are certain instances where blockchains can prove to be useful for storing data.
He argued that,
“Blockchains as data stores for short text records may be marginal or may be significant, but I do expect at least some of that kind of usage to keep happening. Blockchains really are just incredibly convenient for cheap and reliable data retrieval, where data continues to be retrievable whether the application has two users or two million.”
This paper came after, earlier this year, Buterin explored the idea of soulbound tokens, which are tokens that can’t be sold or separated from their owners. And in mid-May, he co-authored the above-mentioned research paper explaining how non-transferable soulbound tokens can create a richer, pluralistic ecosystem within Ethereum, called “Decentralized Society” (DeSoc).
Buterin argued that soulbound tokens can be used to encode social relationships of trust. However, this did not come without controversy.
“Identity & reputation are complex and subjective variables that can never be adequately characterized by numbers on a blockchain,” Polynya, a pseudonymous Ethereum researcher, argued in early June.
Buterin discussed the soulbound tokens on the recent Bankless podcast as well:
____
Learn more:
– These Are Some Topics Ethereum Developers Disagree With Vitalik Buterin On
– Contradictory Vitalik Buterin Says He Wants a More Bitcoin-like Ethereum
– Vitalik Buterin Says His Influence Over Ethereum Diminishing, Harder to Make Things Happen
– Buterin Claims Ethereum Simplicity is Still Possible, as Developers Warn of Increasing Complexity
– Vitalik Buterin Makes Low-key USD 5M ETH Donations in Support of Ukraine
– Vitalik Buterin & Binance CEO Chime In as Do Kwon Proposes Another Terra ‘Revival’ Plan
