Verifiable Credential
A tamper-evident, cryptographically signed digital claim about a subject (person, organization, or thing) that can be verified by anyone without contacting the original issuer. In blockchain contexts, verifiable credentials are used alongside decentralized identifiers (DIDs) to enable privacy-preserving identity verification — proving specific attributes (age, qualifications, memberships) without revealing unnecessary personal information.
“A government could issue a verifiable credential confirming you're over 21 without revealing your exact birth date, name, or address. A DeFi protocol could verify this credential to grant access to certain features.”
Decentralized Identity (DID)
A self-sovereign digital identity system built on blockchain technology where individuals own and control their personal data and credentials without relying on centralized authorities like governments or corporations. DIDs use cryptographic proofs to verify claims (age, qualifications, membership) without revealing unnecessary personal information, enhancing both privacy and security.
Soulbound Token (SBT)
A non-transferable token that remains permanently attached to a specific wallet address, conceptualized by Vitalik Buterin. SBTs are designed to represent identity, achievements, credentials, and reputation that shouldn't be tradeable or transferable. They enable on-chain identity systems where trust is built on verifiable, permanent records rather than transferable assets.
Decentralization
The distribution of control, authority, and data processing across a network of participants rather than concentrating it in a single entity. In blockchain, decentralization means no single party controls the network, making it censorship-resistant and reducing single points of failure.