SQRL is a protocol that does the whole decentralized identity thing, but almost no one uses it because most websites are centralized anyway. It looks to me like its a perfect match for nostr. It's well thought out and handles compromised identities with rekeying using a rescue code.

Seems like everyone is reinventing the wheel these days (unknowingly), but it looks to me like the solution is already there, its just needs to be made nostr friendly/compatible.

SQRL intro Q&A: https://sqrl.grc.com/pages/introductory_questions_and_answers/