The Web3 Identity Revolution: Why Universal Profiles Are the Future
In Brief
Web3 identity solutions like LUKSO’s Universal Profiles offer users full control over their digital identity, enhancing security, privacy, and interoperability.
Your online identity isn’t really yours. Big tech companies store your personal data, track your behavior, and can revoke your access at any time. Centralized entities like banks require names, emails, home addresses, and photos to verify users. However, these data storage systems are highly vulnerable to breaches. For example, in April 2021, Forbes reported that some hackers leaked 533 million Facebook details, exposing users to identity theft.
Beyond security concerns and centralized control, people use the same or similar passwords across several websites, increasing the risks of fragmented logins. Big companies like Meta, Google, etc. also collect users’ behavioral data and monetize it, limiting their privacy across sites and social channels.
Web3 Identity: The Shift to Ownership and Interoperability
Unlike traditional systems, blockchain-based identity gives users direct control over their data. Although a common misconception is that blockchain identity makes all data public, technologies like Zero-Knowledge Proofs (ZK Proofs) allow users to prove their identity without revealing sensitive details.
Interoperability is another key advantage. Instead of maintaining separate identities for different platforms, blockchain enables a single profile to function across multiple applications.
What Are Universal Profiles? LUKSO’s Unique Approach
LUKSO is a Layer-1 blockchain designed for creators, brands, and digital innovators. Traditional blockchain networks mainly focus on finance and DeFi, but LUKSO wants to make blockchain more user-friendly, flexible, and interoperable, so that new standards for digital identity, NFTs, and cultural currencies can be established.
They are reinventing digital identity in Web3 with Universal Profiles (UPs), smart contract-based accounts that are more than traditional blockchain wallets
Unlike conventional wallets, which primarily store and transfer assets, Universal Profiles act as fully customizable digital identities that can manage assets, interact with dApps, and serve as a personal on-chain hub.
Universal Profiles introduce improvements over traditional blockchain wallets by using LUKSO Standard Proposals (LSPs), a new set of standards designed to improve flexibility, usability, and security.
- Recoverability and Upgradability
Traditional wallets rely on a single private key and losing that key means losing wallet access. Universal Profiles solve this with LSP6 (Key Manager), which supports multi-key management for account recovery and permission-based access. Unlike traditional multisig setups that require multiple signatures per transaction, UPs offer more customizable and flexible security options. - Gasless Transactions
Universal Profiles streamline blockchain interactions by enabling gasless transactions through meta-transactions and a built-in relay service. Instead of requiring users to pay gas fees, they sign a meta-transaction, which is processed and submitted to the blockchain by a relayer. Currently, LUKSO provides a free monthly gas quota to all users, lowering a big entry barrier to Web3 adoption. - Standardized Metadata
Universal Profiles integrate LSP1 (Universal Receiver Delegate) to automate processing of incoming assets, while LSP5 (Received Assets) allows profiles to track, list, and query stored assets, making it easier to manage NFTs, tokens, and other digital assets. - New Tokens and Advanced NFT Standards
LSP7 (Digital Asset Standard) facilitates token creation and adds advanced functionalities without altering the behavior of existing tokens. Meanwhile, LSP8 (Identifiable Digital Asset) improves NFTs with extensive metadata, allowing creators to develop, manage, and evolve digital assets on-chain. These standards enable new use cases beyond simple collectibles, bringing deeper customization, programmability, and permanence to digital ownership.
One of the most experimental uses of LSP8 is BurntPix, a fully on-chain fractal NFT designed by Péter Szilágyi, Ethereum’s former lead Go developer. BurntPix isn’t just minted, it evolves over time. Owners must “refine” the fractal by sending continuous transactions, making each NFT unique through blockchain interaction. To refine a BurntPix NFT, owners must continuously send transactions. Over time, this has made BurntPix one of the most gas-intensive projects on LUKSO, comparable to how Bitcoin mining requires ongoing computational power. This shows how LSP8 enables programmable, evolving NFTs that go beyond static digital art.
Universal Profiles vs. Traditional Wallets: What’s The Difference?
Universal Profiles work as an all-in-one interactive public profile for everyday users and creators. Below are some of the ways UPs supports creators, brands, and builders:
Full Ownership of Digital Identity
Web3 creators, builders, and brands have a self-sovereign identity. Using the ERC-725 standard, a blockchain framework for decentralized identity solutions, UPs give creators full control over their data without depending on centralized intermediaries. Unlike traditional accounts that can be suspended or deleted by platforms, Universal Profiles remain fully under the user’s control, guaranteeing digital independence. This means users own their digital identity, assets, and interactions without fear of censorship or loss due to platform restrictions.
Interactive Identities
Universal Identities are smart contract-based accounts that allow users to show assets, interact with dApps, and personalize their profiles with usernames, descriptions, portfolios, and more. Using a modular architecture, a blockchain design approach that supports independent upgrades, creators can modify their profiles without altering the broader on-chain system.
dApps Integration
Universal Profiles provide greater customization through integration with decentralized applications (dApps). This mini-dApp functionality allows users to interact with Web3 tools easily. A notable example is Universal Page, which functions as a profile discovery and content hub for LUKSO’s ecosystem.
NFT Ownership, Creation and Management
Unlike traditional wallets, which only store and transfer NFTs, Universal Profiles tie NFTs to a user’s identity. This improves security, recoverability, and usability, allowing for structured, interactive ownership experiences instead of just anonymous storage.
By linking NFTs to a decentralized identity, UPs make it easier to verify ownership and provenance. Profiles can display, organize, and interact with NFTs in a structured way, instead of just holding them in an anonymous wallet address.
LSP8 (Identifiable Digital Asset) improves NFTs with rich metadata and upgradeable properties, helping creators to develop dynamic assets instead of static collectibles. Smart contract permissions (LSP6) further improve security by letting users set recovery options and manage asset permissions, features that traditional wallets lack.
Unlike static wallet addresses, UPs provide a more user-friendly, secure, and interactive way to manage NFTs, whether for showing collections, integrating with dApps, or verifying authenticity within LUKSO’s ecosystem.
Real-World Impact: Why Universal Profiles Are the Future?
Universal Profiles provide benefits for a wide range of users, from creators and brands to everyday Web3 participants and businesses.
Creators and Artists
A single on-chain identity links their content, audience, and assets across multiple platforms. This improves discoverability, monetization, and control over their work. Some examples of creators using Universal Profiles are TeflonSega, a well-known virtual musician, and Ethalorian, a popular podcast host. These individuals show how creators can manage their on-chain identity, cross-promote content, and create, sell and trade digital assets on the LUKSO blockchain. Another example is Near Field Circuit, an innovative phygital art project by Jim Hannon-Tan. By linking NFC-enabled sculptures to LSP8 NFTs, the project creates self-authenticating digital-physical artworks secured through Universal Profiles. This approach allows artists to embed provenance, interact with collectors, and ensure their work is verifiable on-chain.
Everyday Web3 Users
Managing multiple wallets and seed phrases can be confusing. Universal Profiles simplify onboarding by offering a single, recoverable identity across dApps and blockchain services, making it more user-friendly for newcomers to Web3.
Brands & Businesses
Companies and brands can use Universal Profiles to authenticate digital products, such as issuing digital certificates of authenticity for luxury goods. This provides transparency and builds trust with customers.
They can also launch loyalty tokens tied to user profiles, allowing for direct and personalized engagement with customers in a decentralized way. For instance, a coffee shop could issue tokens that customers collect and redeem for rewards.
Developers & Builders
Developers can build applications with native identity management, using Universal Profiles to handle user authentication and permissions seamlessly. This reduces friction for end-users and enhances security. By integrating UPs, developers can offer gasless transactions within their dApps, improving user experience and lowering entry barriers for users unfamiliar with blockchain transaction fees.
These examples illustrate the wide applicability of Universal Profiles in improving user experience, security, and functionality across different fields within the Web3 ecosystem.
Conclusion
The shift from fragmented, platform-controlled identities to user-owned digital identities is necessary to mitigate the risks of data surveillance and privacy breaches. Built on the LUKSO blockchain, Universal Profiles allows users to create an on-chain identity and update their existing data, such as links, profile descriptions, tags, and images embedded in the smart contract. Developers can also use the existing LUKSO Standard Proposals (LSPs) as foundational components to design new protocols or extensible dApps, supported by a modular architecture.
As Web3 adoption expands, the need for secure and customizable digital identities will intensify as more users demand control and privacy. Now more than ever, users and developers must adopt Universal Profiles to help shape a disruptive decentralized future.
Disclaimer
In line with the Trust Project guidelines, please note that the information provided on this page is not intended to be and should not be interpreted as legal, tax, investment, financial, or any other form of advice. It is important to only invest what you can afford to lose and to seek independent financial advice if you have any doubts. For further information, we suggest referring to the terms and conditions as well as the help and support pages provided by the issuer or advertiser. MetaversePost is committed to accurate, unbiased reporting, but market conditions are subject to change without notice.
About The Author
Gregory, a digital nomad hailing from Poland, is not only a financial analyst but also a valuable contributor to various online magazines. With a wealth of experience in the financial industry, his insights and expertise have earned him recognition in numerous publications. Utilising his spare time effectively, Gregory is currently dedicated to writing a book about cryptocurrency and blockchain.
More articles
Gregory, a digital nomad hailing from Poland, is not only a financial analyst but also a valuable contributor to various online magazines. With a wealth of experience in the financial industry, his insights and expertise have earned him recognition in numerous publications. Utilising his spare time effectively, Gregory is currently dedicated to writing a book about cryptocurrency and blockchain.
