Sybil attacks are one of the Web3 threats that must be recognized and urgently need to be avoided. Sybil attack is one of the threats that can threaten the blockchain and Web3 project. Rather than an attack on the blockchain system or smart contracts, Sybil attacks undermine trust. Attackers break trust by forging a very large number of identities. And using them to take advantage of the Web3 project. From farming airdrops, flooding the DAO, and other threatening activities. This has the effect of distorting your project data, which can ultimately reduce the value of your actual community.
Many efforts are commonly made by Web3 project teams to avoid this attack. Starting from CAPTCHA or KYC or others. But the advancement of technology can also get around these efforts. Therefore, the existence of Sybil resistance comes as a solution. This tool is a requirement for the Web3 project to be able to avoid Sybil attacks.
This article explains in more depth what a Sybil attack is. We will also explain why most attempts to defend against this attack fail, and how Sybil resistance should be done.
What Is a Sybil Attack
Sybil attacks are attacks that occur when one person creates multiple fake identities to exploit a decentralized system. Usually, the attacker forges multiple crypto wallets. These wallets act like real users. But the truth is that these wallets are only controlled by one person, the attacker. These wallets are used by the attacker to reap as much profit as possible, unfairly of course. In fact, they will also try to get all the rewards without the need to make a real contribution to the project they are targeting. Therefore, the Sybil attack can be called a sneak attack but can drain the value of Web3 projects. It is capable of distorting participation and falsifying growth, which can be detrimental to the project.
How Sybil Attacks Affect Specific Web3 Areas
Airdrops
Sybil attacks can impact airdrop campaigns. Many attackers create Sybil wallets in order to farm token rewards. Attackers join airdrop campaigns with hundreds or even thousands of fake accounts. That way they have the opportunity to claim as much of the campaign's allocation as possible. As a result, genuine users who are genuinely interested in the project get little to nothing. Your tokens will end up in the hands of attackers who will most likely dispose of them. And worse, you will lose all the genuine potential users who can build and develop your Web3 project.
DAOs
Sybil attacks can also adversely affect the DAO system. In the system, every user who owns a token or crypto wallet can vote. A Sybil attacker could split their holdings across multiple fake wallets to get more votes. This undermines governance by allowing one person to pass or block proposals that don't reflect the true community.
Referral Programs
The referral system was actually set up with the purpose of rewarding users who have contributed to the project for real user growth. But the Sybil attacker changed everything. They created fake accounts to target their referrals for bonuses. And on the project side, they won't accept anyone. In terms of metrics, you might reach the goal set for the referral campaign. But because of the Sybil attack, Web3 projects will only waste your incentive budget without getting real results.
User Metrics
The presence of fake wallets from Sybil attackers will definitely distort the adoption numbers. Your dashboard or analytics report might show 10,000 users. But a Sybil attack may mean that most of your users are inactive. Besides being costly, this can also mislead your team, investors, and your roadmap decisions.
Why Traditional Defenses Don’t Work
Most Web3 projects try to stop Sybil attacks by using some common methods that are familiar to the public. Tools like token gating, CAPTCHA, and KYC are commonly used to avoid Sybil attacks. These may look like solid defenses, again, because many people use them. But in practice, they are not entirely helpful.
Token Gating
Some projects require users to hold tokens to participate. But attackers can buy and then spread tokens across the thousands of wallets they have. Therefore, relying solely on token gating cannot stop the Sybil attack. It might just raise a few pointless costs.
Read also: Token Gating for Customer Engagement & Revenue Generation
CAPTCHAs
CAPTCHAs are designed to block bots. But most attackers crack them easily. They use automated solvers or outsource the task to people who can be underpaid. Meanwhile, CAPTCHAs annoy real users and don't stop large-scale abuse.
KYC
KYC may be able to stop the Sybil attack. But the other downside of KYC is that they can also stop real users. Most Web3 users value privacy and will not complete identity checks just to join an airdrop or DAO. So this is why KYC is not scalable for unauthorized participation.
What Is Sybil Resistance
Sybil resistance is a system that has the ability to distinguish between real people or users and fake identities. With its collaboration with Web3, it has the ability to ensure each crypto wallet represents only one user. It also ensures that the user is not a bot farm. Sybil resistance is the best and safest solution. This system does not require the disclosure of personal information so it is not harmful to the project. The goal of Sybil Resistance is not to find out who someone is, but to prove that they are real.
The Sybil resistance system gives every participant a fair voice, fair rewards, and a fair place in the network chain or project. Without this system, any decentralized process is highly manipulable by irresponsible people. It's not just about blocking abuse, Sybil Resistance is about maintaining trust, governance, and the long-term growth of web3 projects.
Proven Approaches to Sybil Resistance
There is no single solution to Sybil attacks. But there are some effective approaches that make these attacks more difficult to carry out, and can be more easily detected in advance.
Web3-Native Identity Proofs
These systems prove that a person is a unique human being without exposing personal data. Concrete examples of implementing these systems include:
Biometric checks
Zero-knowledge proof
Wallet-bound credentials
These systems focus on verifying the “truth”, not the identity of the user.
Read also: Guide to Zero Knowledge Cryptography
Economic Friction
Requiring users to stake tokens or perform work will increase the cost of creating fake accounts. Proof-of-Stake and Proof-of-Work are both based on this idea. This makes Sybil attacks expensive to scale.
Machine Learning Detection
Several systems were created to monitor on-chain behavior, including machine learning systems. These systems were implemented by the Web3 project to detect suspicious patterns that could be inferred by bots. These include transaction times, wallet activity, and interaction types. These systems flag Sybil-like behavior before the damage spreads.
Social Graph Analysis
By analyzing wallet relationships, the protocol can detect groups of fake accounts and filter them out. Because usually real users have real connections, while fake users often act alone.
Reputation Systems
Reputation is earned over time. A good reputation can be earned through consistent participation. In this case, Bots may find it difficult to have consistent, long-term engagement in the dApps ecosystem. This system rewards honesty and makes trust measurable.
Real World Examples of Sybil Resistance
Humanode
Humanode uses biometric technology to confirm that each new user is a real human being. In its acquisition process, the Humanode system does not require a KYC process. Humanode uses the user's biological uniqueness instead of the user's name or location. This makes it very difficult for anyone to create multiple accounts.
Celo
Celo is a tool that supports a decentralized identity framework called Self Protocol. Their system includes OpenPassport, which allows users to carry verifiable credentials across platforms. These credentials help prove trust without compromising the privacy of the user.
Build Web3 Project With Trust
Sybil attacks are not something to be ignored. They can threaten your project, whether your rewards are drained, your DAO is hijacked, or your metrics no longer make sense. These attackers can damage your growth, governance, and credibility. Sybil's real resistance comes from a system that is fair, private, and hard to fake.
If you want real users, fair voting, and honest data-now is the time to act. Talk to our team to design a Sybil-resistant system for your Web3 project.
As a blockchain development expert we can help your project. Schedule a free consultation with us now.
