An NFT security solution that enables p2p NFT lending and more. (Double Identity)

Title

An NFT security solution that enables p2p NFT lending and more!

Authors

Louis Chan (doubleweb3.com team)

Summary

As Merit Circle is growing in the NFT space, we reckon there is a huge demand in the NFT security and NFT financing space. Doubleweb3.com is proposing a security protocol called Double Identity, which creates a “proxy” of the original NFT.

Abstract

According to the DappRadar Q1 industry report, DApps lost $1.2B to Hacks just in Q1 2022. The report also suggested over $12 billion worth of NFT trades were conducted in the same period.

The securest way to store NFTs is to keep them in an air-gapped hardware wallet. Since a significant NFT risk is associated with scams and phishing websites, NFT holders should avoid keeping their NFTs in a daily use wallet. Meanwhile, NFTs are often used in verification as web3 prevails; NFT holders have to sign a message using a wallet holding their NFT sometimes.

Double Identity is a solution for that. NFT holders can mint a “Double “to represent the ownership of the original NFT. After minting a “Double “, users can store their NFTs in a hardware wallet and use only the “Double “to interact with DApps. If the “Double “is lost or stolen, the owner of the original NFT can always call a remote function in our smart contract to destroy the “Double “and re-mint a new one.

Moreover, Double Identity allows users to mint “Double “with an expiry date. Users can also mint multiple “Double” if it is needed (Exclusive functions).

By creating the security standard, Double Identity also enables p2p NFT lending; the lender can deposit the original NFT into a lending contract, and the borrower can mint a “double” with an expiry date out of the contract by paying some fee.

Motivation

As a team of web3 developers, we are capable of building useful products, we found that it will be a good synergy to grow together with a strong and well-connected community like MC. The demand for an NFT security solution is undeniably huge. Moreover, we believe the p2p lending business brings by Double Identity will benefit the MC ecosystem greatly!

Introducing an innovative concept is not an easy task. This is not a purely technical-driven event. But if we can work with MC’s community, we are sure we can “change the rules of the game” together.

Our team has built several NFT-related tools since June, including:

  1. Free mint alert
  2. Automint bot
  3. Minting firewall (A proxy wallet that protects users’ wallets from being hacked)

You may check them out on our website: doubleweb3.com
demo of minting firewall: Twitter link

Budget

The proposed budget is $50,000 for development. The Merit Circle DAO will receive 5% of our token without lockup. We will issue 100,000,000 doubleweb3 Token; 25% will be allocated to the team (vested over 4 years).

Below is the token distribution:

  • ICO : 25%
  • Airdrop : 30%
  • Team : 25%
  • MC : 5%
  • Reserved : 15%

Rationale

Reasonable valuation
As a team with a good track record and workable product, we are using 1 million USD post-money valuation for the market capitalization of our token.

No equity
We are not using equity financing to minimize the administration cost and to speed up the process.

Who is behind the team?
I am Louis Chan, and I work with three other people in the team; 3 of us, including myself, are Web3 dev with 8+ years of experience. Instead of telling you what we can do, we decided to build some useful products to prove our capability before asking for support from MC’s community.

Blue ocean
Unlike the highly competitive NFT marketplace/projects/aggregator, the NFT security solution is an underdeveloped market. With our innovative solution with the community support from MC, we believe this can be the best investment during the NFT bear market.

This helps MC
p2p NFT lending and NFT security are the two most important factors in growing the P2E gaming communities. That is why we think this is the best to work with MC.

Poll

Should the DAO develop an NFT security solution with doubleweb3.com and take a 5% token for a $50,000 budget?

  1. The acceptance of this proposal grants the Merit Circle DAO 5% immediately In the event that a token is created.
  2. Merit Circle will help with bootstrapping. This includes community support and fundraising.
  3. After the bootstrap phase, Merit Circle DAO will remain a founding partner, but an independent team will lead the Double Identity.

Copyright

Copyright and related rights waived via Creative Commons CCO

1 Like

Hi @doubleweb3,

First and foremost, thanks for the above proposal!

We’ve waited a while to see the initial response by the community and whether it would spark any interest whatsoever. Considering a week has passed without any comment, nor substantial debate within the community channels (Telegram, Discord), we would suggest to not put this proposal up for voting as of right now.

This topic will simply remain part of the governance section, and anyone is still allowed to share their thoughts. As per the standard forum guidelines, if there is no reply within 30 days, the topic will be locked and thereafter archived.

Thanks for understanding, and thanks again for putting in the time and effort to create this proposal.

1 Like

So there are 3 things in here that need addressing:

  1. The overall mission and/or aim or aim of what you’re attempting to build
  2. The ability to pull said thing of within budget
  3. The structure of which you’re suggesting we engage with it, and it be structured (Tokenised, ICO)

1: The Mission

This solution does not make sense to me. The idea of ‘Doubling’ simply so that we have a representation of said NFT that helps mitigate against hackers, doesn’t feel like the right solution. I think the right solution is to never keep anything of value in the hot wallet and always to use a combo of good security practices and a hardware wallet to manage what you’re doing. Encouraging any use of hot wallets for interacting online in any serious manner, feels silly to me. Hot wallets are designed to be ‘hot’ in the sense that one can move in and out of them fast, almost as a go-between. There is no need to redefine this when hardware wallets already work well.

However, saying that, I do like the concept, and think it may be useful for edge cases, but with the ERCs and abstractions coming out, these nuanced problems tend to get solved.

2 + 3:

On a smart contract-level, unaudited, fine, perhaps we can get away with doing this for $50k. To actually make this into a robust product that’s battle tested and people can trust, no chance.

Regarding the 'ICO’ing of the project into a tokenised project, I think that is what kills this proposal. This makes absolutely no sense from my point of view. I’d much rather see a 1-off-grant that allows you to build and we leverage the code to build on top off, as opposed to a quasi-company-tokenised project in order to use it.

Overall, I think its a cool concept and I definitely see things such as this getting implemented, either through private initiatives such as yours or directly via ETHF and the work they’re pushing out over there to help with account abstractions and useablility.

What kills it for me is the structure of this proposal, the ICOing, and the core go-to-market.

For me it would be a no.
S

1 Like

Thanks for your questions.

  1. never keep anything of value in the hot wallet and always to use a combo of good security practices and a hardware wallet to manage what you’re doing.

Ans: you are partially correct, as I have mentioned too, the safest way to is keep things in an “air-gapped” hardware wallet. But at the same time, we need to take care of the usability of the NFT too. The secure way is not user friendly at all and hence, people will either giving up the secure way or they simply don’t “use” their NFT. My solution is to solve this problem, making a double that is okay to be hacked.

  1. The ability to pull said thing of within budget

Ans: We are continue building and delivering, just yesterday, we have developed the Capsule Machine, a gamified way to buy and sell NFT. https://twitter.com/DoubleWeb3/status/1566692630024503296

With or without the financial support from MC, we will deliver all the suggested work and we are delivering. But we do need some community support and I hope we can get it from MC.

  1. Regarding the 'ICO’ing of the project into a tokenised project, I think that is what kills this proposal.

Ans: Using ICO and tokenisation model is one the most direct way to align everyone’s interest. That’s why we put it into our proposal, we are more than happy to explore different kind of collaboration

Again, thanks for reading and asking question. Truly appreciated!

1 Like

We have developed a new way to buy and sell NFT.
Our whitepaper on Capsule Machine

Guaranteed Capsule Machines (GCM)

Guaranteed Capsule Machines (GCM) let sellers to divide their NFT into many tickets, and each ticket will be sold for a tiny amount of ETH within a limited time. One winner will be drawn from all buyers when the time is up or having all tickets sold.

A lucky winner can purchase the valuable NFT at a meager price, while a smart contract on the blockchain will govern the whole process. At the same time, the buyer can collect more ETH than just selling on Opensea!

For example, a holder wants to sell the BAYC.

  1. Sell it at the floor price, which is 80ETH
  2. Or, set up a Guaranteed Capsule Machine, divide the NFT into 1500 tickets, and sell each ticket for 0.08 ETH and receive 120ETH

Service fee

Doubleweb3 will charge 2.5% of the income from seller as the service fee, the income from Capsule Machines will be used to buy back Grassroot pass (NFT issued by Doubleweb3) and our token.

1 Like

This could be something very profitable. I like this capsule idea a lot and would like to be part of if.

1 Like

I like the overall idea, the team has excellent execution. But you guys need to work harder on the UI/UX. Maybe someone from Meritcircle can help.

Totally understand that, we have done the revamp again. Please check out our latest capsule machines webstie:

This is sick, I am very impressed. It looks very clean and professional now. Wish you every success in the future.

→ This seems as though it will open up new attack vectors above and beyond that of gaining access to one’s wallet.

→ The audit(s) should and will cost a pretty penny. This needs to be factored in if you want it to be taken seriously.

This type of tool does not need to be tokenised, nor does it need all of the legal ramifications associated with launching a token. You could simply throw up the contracts.

  1. which part “seems as though it will open up new attack vectors” and how?
  2. audit has been done, I don’t get your point
  3. I can get where are you coming from, but I don’t think your opinion is accepted by most of the web3 tools

“This type of tool does not need to be tokenised.” Can’t believe I heard this from a Meritcircle holder. You should clear your mind first