In-Depth Benchmark Analysis of DID Identity Verification Projects to Watch in 2024

Why DID Projects Have Become a Web3 Hot Topic

Since the groundbreaking launch of Worldcoin (WLD) in 2023, the entire decentralized identity recognition field has experienced explosive growth. Currently, WLD is priced at $0.50, with a 24-hour increase of +0.30%, and a circulating market cap of $1.29B. This figure alone indicates the market’s growing recognition of DID solutions.

In the traditional internet, users’ identity data is controlled by centralized institutions like Facebook and banks. The DID paradigm introduced by Web3 has completely changed this—users are no longer passive data providers but true owners of their identities. This shift is especially critical in highly trusted financial sectors.

Core Operating Mechanism of DID

The foundation of a DID system is a pair of cryptographic keys: a public key, which publicly identifies your digital identity, and a private key, stored on your device for authentication. This asymmetric encryption ensures that only the key holder can control the account, effectively avoiding the risk of large-scale data breaches caused by hacking centralized platforms.

Unlike traditional KYC processes that require repeatedly submitting documents across multiple platforms, DID allows users to verify their identity once on a single chain and then directly use it on other platforms supporting the standard, significantly reducing time costs and privacy exposure risks.

A Key Component of DeFi Security Infrastructure

In the DeFi ecosystem, DID acts as a trust hub. Each transaction can be traced back to a verified identity without exposing real personal information. This enables platforms to meet AML (Anti-Money Laundering) and KYC compliance requirements while protecting user privacy—an effective dual benefit.

At the same time, the introduction of DID significantly reduces fraud costs—impersonation becomes nearly impossible, providing a solid security foundation for DeFi applications relying on smart contracts.

Mainstream DID Projects in 2024

Worldcoin: Pioneer in Biometric Identification

Worldcoin uses a unique iris scan biometric scheme through the World ID project to create a unique identity. This means each real user can only register once in the system, effectively solving Sybil attack issues. Currently, WLD is priced at $0.50, with a market cap of $1.29B, integrated into major public chains like Ethereum, Optimism, and Polygon.

The Tools for Humanity team built World Chain, a dedicated Ethereum Layer 2 network designed with a human-first approach, aiming to reinforce the value of human identity in an era dominated by automation. The company is in talks with financial giants like PayPal to integrate and bridge traditional finance with Web3 identity barriers.

Advantages: Innovative biometric technology, inclusive design for unbanked populations
Challenges: Privacy concerns over biometric data, complex global regulatory compliance

Lifeform: Breakthrough in 3D Virtual Identities

Valued at $300M, Lifeform recently completed Series B funding (led by IDG Capital), following Series A of $100M and seed funding of $15M. Its core strength lies in generating ultra-realistic 3D virtual avatars and linking them with Web3 identity systems.

Lifeform has integrated with Web2 social platforms, creating bridging solutions between virtual and real identities. Supporting over 3 million independent users demonstrates its market appeal. This scheme allows users to create verifiable digital avatars while remaining anonymous, opening new possibilities for Metaverse social interactions.

Advantages: Cross-Web2/Web3 user experience, strong visual recognition
Challenges: High technical complexity, costly implementation, cross-platform compatibility issues

Polygon ID: Example of Zero-Knowledge Proof Application

Polygon ID employs zero-knowledge proof (ZKP) technology, enabling users to prove their identity authenticity without revealing specific information. In February 2024, Polygon Labs partnered with Animoca Brands and Human Institute to launch the “Humanity Protocol,” incorporating palm recognition technology; in April of the same year, they released a ZKP-based identity authentication protocol.

This technology aligns perfectly with Web3’s privacy-first philosophy—users can prove “I am a real person” without disclosing sensitive data like name or age.

Advantages: Top-tier privacy protection, deep integration with Polygon ecosystem
Challenges: Still a relatively new product requiring time for validation, integration complexity

Ethereum Name Service: User-Friendly Identity Gateway

ENS simplifies complex Ethereum addresses (e.g., 0x1234…) into memorable domain names (e.g., alice.eth), greatly lowering usage barriers. In February 2024, a partnership with GoDaddy allowed non-technical users to easily acquire ENS domains; the same month, ENS integrated ICANN-certified .box top-level domains, pioneering the first on-chain TLD.

While seemingly simple, ENS is a critical infrastructure for DID democratization—it turns identity verification into everyday operation.

Advantages: Highly user-friendly, high community recognition
Challenges: Relatively limited functionality, scalability constraints

Space ID: Cross-Chain Identity Hub

Space ID has built a unified naming space across multiple blockchains, allowing users to manage identities across different chains from a single platform. Supporting everything from transactions, lending, to NFT minting, Space ID represents a move toward interoperability in identity systems.

Advantages: Strong cross-chain compatibility, broad application scenarios
Challenges: Competition from ENS and others, limited outside-chain awareness

Galxe: Hub of Reputation and Credentials

Galxe builds a decentralized credential network using user account data, supporting reputation systems, access control, and multi-layer applications. Its open and extensible platform makes it a foundational infrastructure for DeFi and beyond.

Advantages: Rich data application potential, high ecosystem openness
Challenges: Early-stage product, heavy market education needed

Real Obstacles in Promoting DID

Technical Complexity and User Learning Curve

Transitioning from centralized identity to DID requires users to understand unfamiliar concepts like key management and blockchain. Losing a private key means permanent identity loss, posing psychological barriers for ordinary users. While cross-chain interoperability is technically feasible, differences in standards across chains remain.

Privacy and Compliance Balance

DID promises privacy, but governments demand traceability. Balancing decentralization with compliance to diverse data protection laws (GDPR, PIPL, etc.) tests each project’s wisdom.

Private Key Management as a Double-Edged Sword

Self-custody in DID is both freedom and responsibility. Users must carefully safeguard their private keys—an entirely new challenge for those accustomed to the convenience of “password recovery.” Risks of phishing and malware theft are ever-present.

Future Evolution of the DID Field

Mass Adoption Wave: As applications like MetaVerse and GameFi expand, DID will gradually shift from niche to mainstream, especially in DeFi, NFT trading, and DAO governance.

Privacy-Enhancing Tech Race: Zero-knowledge proofs, biometric tech, etc., will continue to evolve, but over-collection of biometric data also raises privacy concerns.

Cross-Chain Identity Interoperability: Future DIDs will break single-chain limitations, enabling seamless identity transfer across chains, much like passports today.

Regulation-Friendly Innovation: Projects will learn to balance decentralization with regulation, such as mechanisms for selective disclosure of identity information.

Cross-Industry Expansion: Traditional fields like medical records, diplomas, IoT device identities will gradually adopt DID, especially in scenarios requiring trusted AI identity verification.

Summary

DID is not an unattainable ideal but an inevitable product of the Web3 era. From Worldcoin’s biometric exploration to Polygon ID’s privacy solutions, from ENS’s usability breakthroughs to Galxe’s application ecosystem, various projects are answering the same question: how to redefine the meaning of identity in the digital age.

The success or failure of this identity revolution ultimately depends on whether technological innovation, user education, and policy coordination can find a stable balance. For investors and users, understanding that DID is not about individual project wins or losses but about the entire Web3 infrastructure development process is key. In this process, choosing a DID solution that fits one’s needs is far wiser than betting on a single project.