Go To Namecheap.com
Hero image of Navigating the metaverse with decentralized identities

Navigating the metaverse with decentralized identities

With Web 3.0 on the horizon, many new digital changes will impact how we interact with the Internet and, more broadly, the metaverse. The metaverse represents untapped potential in many ways, and the virtual worlds users can interact with through VR headsets are mere inklings of what’s possible.

A lot of the metaverse’s real value will only come about through the integration of decentralized identities. Today, let’s explore what decentralized identities are, how they will impact Web 3.0, and the applications of decentralized identities in the metaverse.

What is a “decentralized identity”?

In a nutshell, a decentralized identity — also called a self-sovereign identity – is a digital identity where personal information is controlled by the person it belongs to. Rather than one’s account information, login profile, and personal info being controlled by large corporations like Google, the user has control over their identity.

It’s all possible thanks to decentralized networks called blockchains. Put simply, a blockchain is formed when many terminals where computers work together to store public ledgers of information. Whenever information in the ledger is changed, the public ledger also changes, and each blockchain node changes its information correspondingly.

The result? No one can steal, alter, or otherwise manipulate personal information without it being readily obvious to everyone involved in the decentralized network. As its name suggests, a decentralized identity doesn’t rely on any centralized authority or corporation to work.

How will decentralized identities work with Web 3.0?

Web 3.0 is a catchall term describing how the Internet will evolve and change in the coming decades. Where Web 2.0 was/is about users creating content and posting that content on company-owned, centralized platforms, Web 3.0 will be more about:

  • Self-sovereign identities
  • Decentralized transactions and data transfers
  • Metaverse interactions

The metaverse is an interconnected series of worlds — some virtual, others purely digital – that can all, in theory, be accessed by individuals smoothly and seamlessly. Imagine, for example, jumping into a VR business meeting with your coworkers as you tackle a remote project. Then, you take the same avatar from that virtual business meeting and join a game with your friends in another virtual world. That’s the potential of the metaverse.

The metaverse is relatively new, and many of its offerings aren’t that stable. But as Web 3.0 technologies become more common and understood, the metaverse will continue to grow and become more and more useful.

Hedgehog wearing VR goggles in a Men in Black pose

The implications of web 3.0 identities in the metaverse

You might picture the metaverse as a series of virtual “video game” worlds that don’t offer much yet. However, Web 3.0 will make the metaverse much more than a theoretical remaking of the Internet. It will enable the metaverse to change the way people interact with the digital world we’ve collectively built over the decades.

Greater control over personal information

One of the biggest ways in which Web 3.0 will change and allow for metaverse operation and interactivity is through the spreading of decentralized identities. In essence, once Web 3.0 truly evolves, users will control their identities and personal information.

Anonymity will be fully possible, and, more importantly, users will be able to move their identities, profiles, and login information across different worlds, pages, accounts, etc. By giving users total control over their personal information, we will likely see major changes in the areas of identity theft, cybersecurity, and more.

Consistent metaverse activities/earnings

In addition, Web 3.0 will facilitate more consistent activities and earnings across the metaverse.

Right now, it’s difficult to maintain the same avatar and progress across multiple metaverse worlds. But the metaverse promises you’ll be able to take the same digital identity, which may or may not include a 3D avatar, across the entire metaverse, much like you can take your body across the entire planet right now.

Once Web 3.0 is a reality, users will ultimately control their decentralized identities. More importantly, Web 3.0 will facilitate greater integration of different metaverse worlds, platforms, and digital universes.

It will become much simpler — and possible! — for a user to earn something in one metaverse world, for instance, then take that item to another world. The possibilities are limitless. Imagine earning an item in a Metaverse video game and transferring it to another game. Or imagine buying property in one metaverse universe and keeping that property with your 3D avatar when you go to a business meeting in another universe.

DeFi integration and growth

Perhaps more importantly, decentralized identities will demand a new form of digital finance. Decentralized finance is the ideal choice for Web 3.0 evolutions.

Therefore, the metaverse will likely integrate more DeFi platforms, technologies, and tools. People may use cryptocurrency much more frequently over the Web 3.0 ecosystem, as they’ll control their digital wallets and be able to pay for things throughout the metaverse.

For example, you’ll be able to move your 3D Web 3.0 avatar to a digital storefront to purchase new clothes for that avatar. Those clothes could be purchasable with crypto tokens, which you can transfer between different games and platforms.

Hedgehog contemplating blockchain

Major challenges of Web 3.0 decentralized identity adoptions

Even though Web 3.0 will bring many benefits and advantages to those who join it, it will also come with notable challenges and difficulties. Many will encounter two big challenges: user understanding of new technologies like decentralized identities and the interoperability of different metaverse worlds and locations.

User understanding and trust

For starters, users must fully understand how Web 3.0 technologies work and, more importantly, how their decentralized identities work. Many users are used to big companies providing security for their personal information. They aren’t expected, for example, to know how to spot identity theft scams, such as phishing emails.

In the initial stage, this will likely be something of a learning curve for many. Users will have ultimate responsibility for their information, so they will also be responsible if they lose that info or it is stolen from them. It will take time for users to build up trust in the Web 3.0 ecosystem as well – there’s already a lot of skepticism regarding crypto tokens and how the metaverse will work in the first place.


In addition, companies that create new metaverse games, worlds, and platforms will need to focus on interoperability. After all, one of the main selling points of the metaverse as a concept is the idea that all the major worlds and universes, including games, digital real estate, etc., work together.

If users can’t move their metaverse avatars from world to world, much of the value of this iteration of the Internet will be lost. Many companies may spend a lot of time and money guaranteeing interoperability for their users.

The future will bring together Web 3.0 and the metaverse

Ultimately, decentralized identities and Web 3.0 will heavily impact the metaverse. The metaverse will never fully achieve its potential without both of these developments. With decentralized Web 3.0 identities, users may soon be able to “live” in the metaverse like never before.

Was this article helpful?
Get the latest news and deals Sign up for email updates covering blogs, offers, and lots more.
I'd like to receive:

Your data is kept safe and private in line with our values and the GDPR.

Check your inbox

We’ve sent you a confirmation email to check we 100% have the right address.

Help us blog better

What would you like us to write more about?

Thank you for your help

We are working hard to bring your suggestions to life.

Gary Stevens avatar

Gary Stevens

Gary Stevens is a web developer and technology writer. He's a part-time blockchain geek and a volunteer working for the Ethereum foundation as well as an active Github contributor. More articles written by Gary.

More articles like this
Get the latest news and deals Sign up for email updates covering blogs, offers, and lots more.
I'd like to receive:

Your data is kept safe and private in line with our values and the GDPR.

Check your inbox

We’ve sent you a confirmation email to check we 100% have the right address.

Hero image of Tech Beat by Namecheap – 18 August 2023Navigating the metaverse with decentralized identities
Next Post

Tech Beat by Namecheap – 18 August 2023

Read More