diff --git a/services/identity/src/grpc_services/authenticated.rs b/services/identity/src/grpc_services/authenticated.rs
--- a/services/identity/src/grpc_services/authenticated.rs
+++ b/services/identity/src/grpc_services/authenticated.rs
@@ -262,13 +262,24 @@
       Some(Identifier::WalletAddress(address)) => (address, AuthType::Wallet),
     };
 
-    let user_id = self
-      .db_client
-      .get_user_id_from_user_info(user_ident, &auth_type)
-      .await
-      .map_err(handle_db_error)?;
-
-    Ok(Response::new(FindUserIdResponse { user_id }))
+    let (is_reserved_result, user_id_result) = tokio::join!(
+      self
+        .db_client
+        .username_in_reserved_usernames_table(&user_ident),
+      self
+        .db_client
+        .get_user_id_from_user_info(user_ident.clone(), &auth_type),
+    );
+    let username_reserved = is_reserved_result.map_err(handle_db_error)?;
+    let user_id = user_id_result.map_err(handle_db_error)?;
+
+    // should be true only for reserved usernames that are not registered with Identity
+    let is_reserved = username_reserved && user_id.is_none();
+
+    Ok(Response::new(FindUserIdResponse {
+      user_id,
+      is_reserved,
+    }))
   }
 
   async fn update_user_password_start(
diff --git a/shared/protos/identity_authenticated.proto b/shared/protos/identity_authenticated.proto
--- a/shared/protos/identity_authenticated.proto
+++ b/shared/protos/identity_authenticated.proto
@@ -126,8 +126,12 @@
 }
 
 message FindUserIDResponse {
-  // none if user not found
+  // userID if the user is registered with Identity Service, null otherwise
   optional string userID = 1;
+  // true if the identifier (username or wallet address) exists in the
+  // reserved usernames list, false otherwise. This is always false
+  // when the user is registered with Identity Service (userID != null).
+  bool is_reserved = 2;
 }
 
 // UpdateUserPassword