Every major blockchain application eventually collides with an identity problem. DeFi lending protocols that want to offer uncollateralized loans need to assess creditworthiness without holding custody of user data. DAO governance systems that want to prevent sybil attacks — one person controlling many wallets to accumulate disproportionate voting power — need to verify personhood without requiring real names. Regulatory compliance frameworks that require KYC create friction that is incompatible with the permissionless design of public blockchains.