Yeah. this is the elephant in the corner of the room. One solution could be to use logically centralised but physically decentralised identity mapping servers

Yeah. this is the elephant in the corner of the room. One solution could be to use logically centralised but physically decentralised identity mapping servers (a bit like DNS root servers, or X.509 root CAs) - like the ones Matrix already runs: https://matrix.org/legal/identity-server-privacy-notice-1#2-what-is-a-matrix-identity-server https://matrix.org/legal/identity-server-privacy-notice-1#2-... - but these end up being a massive toxic stash of personal data. On the other hand, it's not much worse than the current identity databases that Facebook etc maintain. Another bet could be to let the owner of the identifier (your phone provider, in the instance of a phone number) track what service that identifier points to - like ENUM DNS. But that falls foul of political problems (and risks becoming centralised too). Federated/decentralised identity is a problem we're actively working on at Matrix, and the DMA will only act to speed up the process, as it's indeed an important piece for this to work well in practice.