Why On-Chain Reputation Systems Must Adopt Selective Disclosure

Public graphs turn reputation into a brute-force game. Adversaries can algorithmically map the entire scoring system, identify low-cost manipulation vectors, and spawn infinite identities. This destroys signal integrity.

• Sybil resistance becomes a cost function, not a trust primitive.
• Projects like Worldcoin and Gitcoin Passport spend millions to retroactively patch these holes.
• On-chain games like Dark Forest show how public state enables perfect-information exploits.

Full disclosure forces users to leak proprietary behavioral data—trading patterns, social graphs, financial affiliations—to access core services. This creates a massive disincentive for high-value participants.

• Institutional players and sophisticated users will avoid systems that require doxxing their alpha.
• Violates emerging regulatory frameworks like GDPR and data minimization principles.
• Contrast with zk-proof systems like Aztec or Semaphore, which prove traits without revealing underlying data.

Immutable, public reputation creates permanent records that prevent growth and redemption. A single early mistake or low-score transaction becomes a permanent on-chain scarlet letter, chilling experimentation and participation.

• Kills composability as dApps are forced to use stale, negative signals.
• Makes reputation a liability asset instead of a dynamic tool.
• Proof of Humanity and BrightID face constant challenges with updating or revoking status.

Sismo uses ZK proofs to mint 'badges' from private data sources (e.g., Ethereum, GitHub). Users aggregate credentials into a single, privacy-preserving 'Data Vault'.

• Granular Disclosure: Prove you're a top-1000 ENS holder without revealing your address.
• Portable Identity: Badges are non-transferable Soulbound Tokens (SBTs), portable across apps.
• Sybil Resistance: Enables applications like Gitcoin Grants to verify unique-human status privately.

Today's on-chain profiles (e.g., DeBank, Etherscan) are surveillance tools. A public reputation score is a Sybil attack map and a target for exploitation.

• Front-running Risk: Trading history reveals strategies.
• Social Engineering: Whale addresses become phishing targets.
• Discrimination: Protocols could blacklist based on past interactions with competitors like Tornado Cash.

The core primitive is a ZK-proof of a property, not the data itself. This enables trustless verification of reputation claims.

• Selective Disclosure: Prove ">1000 $UNI votes" without revealing wallet balance.
• Temporal Proofs: Prove "held a BAYC for >1 year" without revealing sale date.
• Aggregation: Combine proofs from Ethereum, Arbitrum, Polygon into one verifiable claim.

Worldcoin's orb-based iris scan creates a global, unique-human ZK credential. It's the ultimate Sybil-resistant primitive for reputation systems.

• Privacy-Preserving: The iris code is deleted; only the ZK proof of uniqueness remains.
• Universal Base Layer: A reusable proof of personhood for airdrops, governance (e.g., Optimism), and voting.
• Controversial Trade-off: Centralized hardware orbs for decentralized, private identity.

Semaphore is a ZK gadget for anonymous group membership. Users can prove they're part of a group (e.g., "DAO members") and send signals (e.g., votes) without revealing identity.

• Anonymous Reputation: A DAO can have private, weighted voting based on contribution tiers.
• Feedback & Reviews: Users can leave attested feedback (e.g., on OpenSea sales) without fear of retaliation.
• Infrastructure Layer: Used by projects like Unirep for private social media and anonymous reputation.

Privacy-enabled reputation unlocks RaaS—protocols selling verified, private credentials to dApps. Think Chainlink Oracles for identity.

• Monetization: Charge dApps for proof verification or credential issuance.
• Market Size: Every DeFi loan, gaming guild, and hiring platform needs this.
• Key Players: Sismo, Disco.xyz, Orange Protocol are competing to be the standard data layer.

Forcing users to expose their entire transaction history (e.g., Sismo badges, Galxe OATs) for a single proof is like handing over your passport to buy coffee. It creates data exhaust that competitors exploit and leads to Sybil attacks and reputation laundering.

• Key Benefit 1: Breaks the data silo model, preventing competitors from cloning your user graph.
• Key Benefit 2: Eliminates the attack surface of a public, linkable reputation ledger.

ZK proofs (e.g., zk-SNARKs, zk-STARKs) allow a user to prove a property ("I have >1000 $ETH staked") without revealing the underlying data (wallet address, exact balance). This is the core of selective disclosure, moving from data provision to proof of claim.

• Key Benefit 1: Enables permissionless verification without permissioned data access.
• Key Benefit 2: Unlocks composable reputation across chains and dApps without creating a global ID.

Protocols like Worldcoin (orb verification) or Gitcoin Passport (aggregated stamps) currently centralize attestation. Selective disclosure flips this: users own and cryptographically control their attestations, paying for proving services (like RISC Zero, Succinct) instead of renting access from a data gatekeeper.

• Key Benefit 1: Creates a user-centric reputation market, not a platform-centric one.
• Key Benefit 2: Reduces protocol liability; you verify a proof, not custody PII.

Reputation is only valuable if it's portable. A ZK-proven attestation on Ethereum should be usable to get better rates on a Solana lending market or priority in an Arbitrum NFT drop. This requires standardization around proof formats and verification contracts (see EIP-712, IBC client light clients).

• Key Benefit 1: Enables intent-based systems (like UniswapX, CowSwap) to incorporate trust signals.
• Key Benefit 2: Makes reputation a cross-chain primitive, increasing its utility and liquidity.

The objection that ZK proofs are too expensive is outdated. With custom circuits and recursive proofs, the cost to generate a "reputation proof" can be <$0.01 on L2s like zkSync or Starknet. The real cost is the one-time generation, not the on-chain verification.

• Key Benefit 1: Sub-cent verification makes micro-reputation feasible (e.g., proof of a single successful DEX swap).
• Key Benefit 2: Offloads the heavy compute to specialized provers, keeping user UX simple.

A public, linkable reputation graph is a regulatory and exploit magnet. GDPR/CCPA requests become impossible to comply with. A single data leak doxes your entire user base. Adversaries can game the system by analyzing public patterns (see Flashbots MEV research).

• Key Benefit 1: Future-proofs your protocol against privacy regulations.
• Key Benefit 2: Radically reduces the attack surface for Sybil and manipulation attacks.