Bridging Reputation in the Crypto Space

In the Wild West of crypto, where scams and fraud remain common, one team is innovating a novel solution: bringing reputation on-chain. Ethos Network is a platform designed to establish credibility and trust in the crypto space, gaining traction as it tackles one of the industry’s most persistent problems—bad actors.

The Concept

The brainchild of Trevor Thompson (aka Serpin Taxt) and Ben Walther, Ethos emerged from the frustration with rampant scams affecting the space. Thompson shared with Decrypt:
“I used to do a lot of trading in crypto and witnessed numerous crimes, frauds, and scams that have intensified in recent cycles. I felt inspired by the chance to solve some of that.”
The idea solidified after Thompson’s experience with Friend.tech, an abandoned social platform where users bought and sold “keys” tied to Twitter accounts.

A New Approach

While Friend.tech introduced the concept of linking on-chain actions to social identity, it failed to adequately address trust and credibility. “What if we could tie someone’s on-chain actions to who they are as a person, and document that on-chain?” Thompson pondered.

Walther, Ethos Labs’ CTO, has combated fraud and cyberattacks since 2006. Their friendship began after Walther bought Thompson’s Friend.tech key and quickly resold it for a profit. Together, they raised $1.75 million in a funding round led by 60 Web3 community angel investors.

Proof of Credibility

Launched in January, Ethos aims to create a “proof of credibility” system that documents trust through a vouching system. Users can vouch for others by stakimg money against their reputation, with stakes that can be withdrawn anytime.

The platform’s motto is straightforward: “Contribute and earn by building your reputation, backing others, or penalizing bad actors.” Users earn “credibility scores,” akin to credit scores but reflecting social standing, based on the evaluations of the platform’s most reputable members.

Challenges and Future Direction

Though Ethos has drawn comparisons to Rate My Professors or Yelp, Thompson believes it’s more significant. “Think about how you buy products or choose doctors—reviews and reputation matter. We’re all independent businesses in crypto, making trust essential.”

There are concerns regarding a “circle jerk” effect, where users vouch for one another to inflate scores. Thompson acknowledges the risk and emphasizes that the aim is to raise the bar for reputation.

The platform features a slashing mechanism inspired by proof-of-stake blockchain networks. Users can challenge someone’s credibility by proposing to penalize them, promoting accountability.

A Sustainable Growth Model

With around 1,000 users and a team of six, Ethos is currently invite-only to ensure sustainable growth. They aim to maintain member engagement to avoid the pitfalls of rapid user acquisition common in Web3 hype cycles.

Future features may include anonymous reviews via zero-knowledge technology, allowing honest feedback without fear of reprisal. The goal is a world where reputation is portable and verifiable across platforms—enhancing trust in various transactions.

As Ethos grows, it strives for transparency while fostering a reputation-backed economy. “In a space where trust is often scarce, Ethos believes that reputation—supported by blockchain—will become the ultimate currency.”

Edited by Andrew Hayward