Author: Eli5DeFi
Compiled by: Deep Tide TechFlow
The cryptocurrency space is rife with scammers and various shady activities. The launch of @ethos_network aims to distinguish the good from the bad through tokenized reputation.
Here are the reasons why Ethos stands out?
Ethos 101
Ethos is, in a sense, a tokenized reputation platform that builds a trustless and verifiable system that can represent account credibility in the crypto space.
Ethos's reputation score is measured based on community sentiment and public interactions from accounts like Twitter and ENS to gauge credibility. Detailed breakdowns can be seen in each Ethos profile, mainly including:
Peer Review
Community voting on your profile
Number of endorsements supporting
Reciprocal endorsements
Ethereum staked on your reputation
The age of your Twitter account
The age of your Ethereum address
It is important to note that these ratings aggregate user feedback and metrics, but are not absolute measures of credibility or character, which are dynamic and may change over time.
To participate in Ethos, you must be invited by a registered member who has already achieved a certain rating, adding a layer of verifiable trust.
How to Use Ethos
In Ethos, you earn points and reputation scores by doing the following:
Review
In reviews, you can assess your peers by giving positive or negative feedback. You can also vote for or against other reviews.
Endorse
Endorsements involve staking your $ETH to an Ethos account as a sign of financial support. This indicates strong backing and credibility.
Staking more Ethereum means more trust. Those being endorsed cannot access these funds; they only represent trust.
You can also collaborate with your peers to achieve a 3,3 (originating from a cooperative strategy in game theory where participants achieve a win-win outcome through mutual cooperation) by endorsing each other, amplifying both parties' credibility scores and rewards.
Through endorsements, you can also receive the following incentives:
Users can earn 1% when they are endorsed by others.
If users endorse others, they can earn up to 4% from future endorsements, but limited to the initial amount.
A 1% protocol fee also applies when endorsing/cancelling endorsements.
Punishment
Punishment allows trusted Ethos users to flag unethical behavior. If successful, the accused's rating will drop by the amount of the bond. If unsuccessful, the accuser's rating will drop. If the conclusion is unclear, the rating remains unchanged.
Before someone can punish other Ethos accounts, several requirements must be met, and the impact of the punishment will be capped based on the punisher's rating.
Ethos Market
If you think this is all, consider this core feature that illustrates why tokenized reputation is a truly new concept: the reputation market.
The Ethos reputation market is based on Hanson's LMSR, similar to @polymarket, but with some key differences. Here, you can trade and speculate on the reputation gained by Ethos accounts by choosing to trust or not trust them. Prices will fluctuate with sentiment, and the market will never resolve.
However, because reputation can change dramatically if an account faces disputes, it is also susceptible to manipulation, similar to how whales on Polymarket might influence the market with large bets.
Summary
Ethos is an emerging tokenized reputation protocol aimed at addressing trust issues in cryptocurrency. It combines community reviews, rewards, Ethereum-based endorsements, and a reputation market to create a dynamic and real-time updated measure of credibility.
Ethos achieves decentralized trust by allowing users to verify each other, rewarding good behavior, and flagging bad behavior, all done on-chain without a central authority. This transparent system offers clear and native signals of trust, opening new opportunities for decentralized autonomous organizations (DAOs) and decentralized applications (dApps).
I believe Ethos is a key step for Web3, helping communities rebuild trust and accountability in a decentralized world.
