Blockchain reputation systems have the potential to change how we think about our digital (and real) reputations. What would it mean to have a universal rating tied to our identity? Is it good or bad?
With smart contracts and multisig technologies, we now have the ingredients to make this a reality.
BLOCKCHAINS NEVER FORGET
The main advantages (and potential disadvantage) of blockchains, is that the information inside them is almost impossible to alter, especially on larger ones like Bitcoins. So in terms of reputation systems, one of the main objections is that every bad decision or mistake you make throughout your life would be up there forever. Every stupid teenage choice or impulsive action could have far reaching consequences down the road. You could also argue that this may change peoples behaviour if they know it's in public view.
GREY, NOT BLACK AND WHITE
So, aside from recording every bad thing you've ever done, these systems also have the potential to catalogue all the positive actions too, balancing out your public character. For example, it'd be possible to use smart contracts to prove things like punctuality at a workplace, or donating to charities, paying bills on time, volunteering to good causes, successfully meeting deadlines etc - all things that are generally thought as positive markers for trustworthiness. You could even add a vouching system on top of it.
In a broader sense, this may shift what we think of as reputation, accepting that everyone makes mistakes and that singular errors generally don't define who we are.
OWNING YOUR IDENTITY
One massive challenge will be key management. There'd need to be ways to keep your identity secure, so others cannot fraudulently manipulate your digital reputation. I could imagine it taking the shape of a hardware passport, that signs new transactions for you, and has multiple levels of authentication.
WHAT DO YOU THINK?
I haven't made my mind up whether this kind of system would be positive, or completely Orwellien. It seems that we are heading for digital identity and reputation systems regardless, so, if there was a decentralized, blockchain based system were each person owns the keys to their own identities, then maybe that'd be better than centralized alternatives? It could potentially add a new level of transparency and accountability, especially for those people and places that don't like such things.