The Cost of Compromise in Legacy Identity Architectures

A single breached database exposes billions of user credentials at once. Recovery requires mass password resets, credit monitoring, and legal liability, costing firms $4M+ per breach on average. The attack surface is static and lucrative.

• Attack Cost: Low, one exploit yields all data.
• Defense Cost: Exponentially high post-breach.
• Example: Equifax, LastPass, countless corporate SSO providers.

Centralized authorities act as mandatory intermediaries for all access and attestations. This creates censorship vectors and systemic downtime. If the identity provider (e.g., Google Sign-In, Okta) fails, every dependent application fails.

• Availability: Tied to one entity's uptime.
• Censorship: Provider can unilaterally revoke access.
• Architecture: Inherently creates gatekeepers and rent-seekers.

Centralized models profit from aggregating and monetizing user data, creating a perverse security incentive. Security is a cost center, while data harvesting is revenue. This leads to under-investment in protection and over-collection of PII.

• Business Model: Conflict with user privacy.
• Data Liability: Hoarded data becomes a toxic asset.
• Result: Users are the product, not the customer.

Centralized identity providers (Google, Apple ID) are honeypots for attackers and create censorship vectors. A single breach exposes billions of credentials, while platform policy changes can lock users out of their digital lives.

• Attack Surface: One credential compromise grants access to dozens of linked services.
• Sovereignty Risk: User access is contingent on a third-party's terms of service, not cryptographic proof.

Web2 identity forces you to over-share. Proving you're over 18 requires handing over your full birthdate and name, creating permanent data trails for platforms like Facebook and advertisers to exploit.

• Data Leakage: Minimal proofs (age, citizenship) require revealing your entire identity document.
• Surveillance Capital: Your aggregated identity graph becomes a product, sold without your direct consent or profit.

Legacy systems create walled gardens. Your reputation on GitHub doesn't transfer to DeFi, and your in-game assets are trapped in a proprietary database. This stifles composite application development.

• Siloed Value: Social graphs, credentials, and assets are non-portable, reducing their utility.
• Developer Friction: Building cross-platform apps requires integrating with dozens of disparate, closed APIs.

Uses Iden3 protocol and zk-proofs to issue verifiable credentials on-chain. Focuses on real-world KYC/DeFi compliance use cases, leveraging Polygon's low-cost L2. Compromise: relies on centralized issuers for initial credential attestation.

• Key Benefit: ~$0.01 verification cost makes on-chain checks feasible for high-volume apps.
• Key Benefit: W3C Verifiable Credential standard compatibility eases enterprise adoption.

Uses ZK proofs to aggregate selective credentials into a 'badge'. Users prove membership (e.g., 'GitHub Contributor', 'ENS holder') without revealing underlying accounts. Compromise: trust in the honesty of the underlying data source (e.g., GitHub's API).

• Key Benefit: Data minimization at its core; proofs are about group membership, not specific data.
• Key Benefit: Stealthy onboarding via 'zero-knowledge logins' protects against sybil attacks.

Allows users to authenticate via traditional OAuth providers (Google, Twitch) and derive a Suí address from the credential, secured by a zk-proof that hides the OAuth token. Compromise: inherits the security and censorship risks of the underlying OAuth provider.

• Key Benefit: Zero-gas onboarding; users don't need a wallet or seed phrase to start.
• Key Benefit: ~1-second authentication using familiar Web2 flows, massively reducing friction.

Centralized user directories are single points of failure. A breach at Okta or Microsoft Active Directory can cascade across thousands of enterprises.

• Attack Surface: One credential leak compromises the entire system.
• Compliance Drag: GDPR/CCPA mandates turn data storage into a legal liability.
• Operational Cost: Maintaining uptime and security for PII databases costs millions annually.

Shift from holding data to verifying claims. Users cryptographically hold credentials (e.g., diplomas, KYC status) and prove attributes without revealing the underlying data.

• User Sovereignty: Data resides with the individual, not your servers.
• Selective Disclosure: Prove you're over 21 without showing your birthdate.
• Interoperability: Standards from W3C and implementations like iden3 and Sismo enable portable identity.

Smart contracts and wallets are becoming the primary identity layer. Protocols like ENS, Unstoppable Domains, and Proof of Humanity demonstrate scalable, user-owned primitives.

• Native Composability: An on-chain reputation score can be used across DeFi, DAOs, and gaming without integration hell.
• Sybil Resistance: Gitcoin Passport and Worldcoin show how to attach cost or uniqueness to identity.
• Automated Compliance: Programmable credentials enable real-time, rule-based access (e.g., accredited investor checks).

Legacy IAM vendors create massive switching costs and stifle innovation. Your identity stack becomes a legacy monolith.

• Integration Sprawl: Each new SaaS app requires custom connectors and ongoing maintenance.
• Pricing Arbitrage: You pay per user, per auth, with ~20% annual price increases.
• Innovation Lag: You're tied to the vendor's roadmap, not web3's exponential pace.