thoughts on digital identity and status

We live in an era of online migration, a hidden Digital Revolution. In the same way the Industrial Revolution overturned systems of capital-motived production, this shift will reshape capital-motivated identity. There is no sudden upheaval of traditions as we upload our minds to Neuralink, rather it has been a slow and inevitable march towards digitalization. Information, assets (dollars, stocks, crypto), commerce and social interactions have all moved online already, which in turn has degraded their IRL counterparts - libraries, trading floors, brick and mortar retail, physical institutions. Identity and social status has not been left unscathed, and is being shaped by several different vectors. Most critically, the old world constraint of mapping status onto a single IRL “identity” is removed, and the rise of digital assets allows for anons/pseudoanons to amass power for the first time in history.

identity requires more agency now

In most of recorded history, and still some modern, your identity/destiny was largely determined at birth. Outside of exceptional circumstances, you were born into a social world that assigned you traits – peasant, farmer, Catholic, Firstborne, etc, etc. Where choices existed, the range was limited, and strong institutions gave people a sense of belonging.

In contrast, modern institutional participation is at all-time lows, and cultural and social mobility is higher than ever before. As a person changes traits and relationships, their identity changes too. This new state of dynamic identity and institutional fragmentation is at odds with a traditional structure that imposes a single, condensed, outward facing “you”.

Discord is the new church - more accurately, online micro communities are replacing IRL macro gatherings. This shift democratizes prior physical constraints, especially geographic ones. It is no longer necessary to move to a “City with Ambition”, as Paul Graham put it, in order to surround yourself with like minded individuals. My closest friends now live in Singapore, Australia, Germany, and sometimes nowhere at all. 

The downside of this freedom is a higher barrier to entry. Finding your online people requires tremendous agency - knowing what you want, where to find it, and ingratiating yourself with the existing community. All three agentic choices are difficult in their own right, and compounded by inherent obscurity of online groups. As participation in default in-groups like religion and nationalism decline, the result is the average person feels more alienated than ever before.

But for those of us who embrace this shift, fragmentation is an opportunity to present ourselves in diverse ways without entangling irrelevant aspects of our identity. There is no reason my online gaming group needs to know of my crypto obsession, and through multiple online identities I can easily draw a line between different vertical interests in my life. Restating from the introduction: the old world constraint of mapping status onto a single IRL “identity” is removed. But how does this relate to crypto/digital assets?

the rise of anons/psuedoanons is upon us

digital is default networked but constrained

Until now, we have always mapped identity and status to personhood because of the enforcement problem. The physical world is very unconstrained – without the ability to hold an individual accountable for their actions, the number of attack vectors is too high. This exists for anything with physical interaction.

Digital worlds are far more constrained, and crucially: enforceable without physical interaction. The Ethereum Virtual Machine only allows predefined interactions with applications. If a user misbehaves in a Minecraft server you can simply ban them – a virtual death sentence. Because of this, entities no longer need to transparently map 1:1 to individuals, because enforcement on the entity, whether through constraints or action, is equivalent to enforcement on the individual.

A good way to think about where the line for digitally native status exists is crypto KYC endpoints. Within the context of a digital system (say, Ethereum), your online identity is enough for commerce – identity being an aggregate of “provably having funds” and other assumptions. However, before you try and touch the physical world (fiat money), you must map to an IRL individual, because the entire digital interaction could have been an attack vector in a complex crime, and enforcement optionality is necessary.

This enforcement problem is why there is no place for anons/psuedoanons in most traditional power structures. But as wealth and power move more online, opportunities arise within the constraints of digital worlds and assets.

Minecraft moderator today, anonymous asset manager tomorrow. This is an inevitable path of power expansion.

What does this mean?

digital status is native

As with any transition, old world status doesn’t always translate to the brave new world. A prestigious degree and suit headshot are the key elements of a traditional resume, and yet wade into a crypto twitter argument armed with those and you might get laughed at by a cute yet very aggressive neo-chibi aesthetic avatar. Native status is only obtained through an observed history of excellence in the medium – whether in crypto, gaming, discourse or other.

Native status exists in every social ecosystem – discord mods, prison trustees, lieutenants, head chefs. Native status is nonportable and earned through demonstrated excellence, and its significance is directly correlated to the reputation and power of the ecosystem. Thus, if you believe in “online eats the world”, digitally native status will only increase in importance going forward.

Deepfakes add another layer of potential deception – all of a sudden provenance/sourcing becomes critical. In the very near future (already happening), videos and audio recordings will only be trusted asofar as the publishers/distributors reputation. Reputation is the only credibility remaining in a post-truth society, and reputation can only be established by repeatedly contributing quality.

Two anonymous accounts that rose to prominent digital status are Satoshi Nakamoto, the inventor of bitcoin, and Scott Alexander, the author of SlateStarCodex. Both have documented histories of high quality thoughts, Satoshi on bitcointalk in addition to the Bitcoin protocol and Scott on his blog. Currently, a race to capture the attention of the native mindshare is well underway; with accounts like @cobie (whose doxx has not negatively impacted his accrued digital reputation) and @CL207 leading the way.

As reputation becomes more critical, I expect mainstream signing schemes to become more popular, in order to connect accounts across platforms. In many ways, Ethereum public key addresses as verifiable identities across platforms is an elegant standard.

with digital status comes digital status symbols

A high status anonymous account can’t properly own or flex land, cars, watches, Gucci, any traditional old world status symbol, at least not natively.

Digital status symbols have existed long before NFTs – think desirable urls, usernames, game skins. Mainstream NFT profile picture projects, like CryptoPunks, found explosive product market fit as the digital equivalent of a luxury watch or car – a flex during online social interactions, a csgo skin for your social profile. Because it was a new digital surface, the offerings that resonated the most with natives won, while traditional luxury heavyweights like Coach, Tiffanies, Louis Vuitton and Porsche all underwhelmed. The best transition at the time was made by Nike, who bought the native digital wearables studio RTFKT - although as we have seen in recent markets digital status can be fleeting, and real longterm lindyness continues to be scarce, as with the traditional world.

if we believe this, wat do

I’m a firm believer that the only way to surf a wave is to stay on top of it – you have to get your hands dirty. You should be building natively digital status and identity. This comes in many forms, from public discourse to private chats to code contributions, it’s really choose your own adventure. The best time to start was 6-8 years ago, but the second best time is today, as the pool is only getting more crowded as time goes on. Start trying out everything new, as status is most easily obtained in new and shifting mediums. You can have fun online.

“With a headset attachment securely in place, we parade our detachment from the street we walk, no longer needing the elaborate etiquette. By switching on the mobile, we switch off the street.”

- Zygmunt Bauman