Identity has always been a sticking point in Web3, and now with AI agents everywhere in 2026, the pressure is even higher to stop Sybil attacks. Walrus steps in here. Built as a decentralized storage layer on Sui, Walrus lets people manage credentials securely—on-chain, no less. More than ten million credentials have already moved over through partnerships, turning identity into something you can actually verify and program. That’s why Walrus sits at the heart of trustworthy DeFi and other Web3 spaces.
So, what’s under the hood? Walrus uses erasure coding to keep credential data safe. Basically, it splits a credential file into a bunch of shards plus some parity pieces, then spreads those shards across different nodes. Sui jumps in to register a Proof-of-Availability certificate, so if some shards go missing, you can still put the file back together. Even if a few nodes drop out, your data sticks around, and on-chain events back up its integrity. For something like a one-gigabyte identity dataset, you might end up with thirty shards, but only need twenty to recover everything. It’s a pretty slick way to balance scale and cost.
The WAL token keeps this whole system moving. It pays for storage, and every payment burns half a percent to keep inflation in check. Stakers run the nodes, earning up to fifty percent APR if they keep things online. WAL holders get a say in governance too—they can vote on new features, like adding integrations. Since Walrus launched its mainnet in March 2025, usage has soared, burns have ramped up, and the supply has gotten tighter. That’s driven up value, especially as demand from AI-driven apps keeps climbing.
The ecosystem keeps expanding. Seal joined in April 2025, using threshold encryption to keep sensitive credentials private. Then in October, Humanity Protocol moved millions of IDs on-chain, making real-time verification possible. Bridges to Solana and Ethereum open the doors to other networks, and Sui’s gas-free stablecoin transfers, which landed in 2026, make identity apps way more accessible.
Picture this: a DeFi platform wants to check user identities. Developers encode credentials using erasure coding and pay WAL tokens for a set period. Shards get spread to staked nodes, while Sui creates a certified blob object. Smart contracts tap these proofs to block Sybil attacks, letting only verified users in. Seal handles privacy, and stakers earn rewards. The result? Secure, smooth lending—no centralized oracles needed.
Walrus keeps evolving to meet Web3’s identity challenges. Hackathons, campaigns, and Binance’s WAL rewards program have powered its growth since 2025. Its storage model supports both AI and compliant DeFi, so builders can finally navigate the regulatory maze.
In the end, Walrus stands out for tough credential storage with erasure coding, the WAL token’s role in burns, staking, and governance, and ecosystem partners like Seal and Humanity pushing privacy and real-world identity use cases—especially as AI takes over.
So, what’s next? How will Walrus’s tools change Sybil resistance for AI DeFi? And where should WAL holders focus next to make sure identity moves easily across chains?
