Blockchain: The New Step in Identity Verification
“If we don’t act now to safeguard our privacy, we could all become victims of identity theft.” — Bill Nelson
Identity theft has been one of the hot topics in the present world. Countless groups of hackers breach systems on regular basis. This not only costs an individual’s identity but also harms organizations on a bigger level as the data collected from these hacking attempts is misused for further fraudulent acts. But with everything being digitized and vulnerable to hacking, is it possible to build a system which cannot be breached and safeguards all the data in it?
The answer is “Blockchain.” But before placing our trust and our precious data on Blockchains, let’s figure out what Blockchain really is.
To put it simply, a Blockchain is a network of distributed ledgers that contains a list of records. The transactions in a Blockchain,after a specific time period, get grouped in the form of a block which contains a timestamp and is further encrypted and stored in a decentralized database. This ensures the authenticity and security of the data and that every peer within the network of the Blockchain has a copy of every modification.
There are so many diverse applications for Blockchain, one of them is identity management. Here are some pointers for Blockchain being the future of digital identity management:
Safety and Security
The Blockchain is revolutionizing the security level with consensus protocol models. With right technology and implementations, a Blockchain is immune to hacking. Even if someone tries to hack a Blockchain with a strong security protocol, then the amount of hardware power required for the breach will cost the hacker a fortune.
Every data transfer or transaction in the network has to go through some consensus protocol models like Proof of Work (PoW) and Proof of Stake (PoS). This ensures the integrity and authenticity of every transaction.Furthermore, any unauthentic changes in the data are easily detected by other members as they will not tally with their data copy.
Transparency with Privacy for Personal Data
Blockchain gives a member the option to share their information according to their needs and requirements. This snatches the ownership of personal data from all the big organizations and gives it to individuals.In this way, there is transparency in the network,yet the privacy of personal data that a user does not want to share.
One Time Verification Procedure for All Members
By this, we mean that once a member is verified as an authentic user then they don’t need to establish their identity again and again in the network. This will lead to smoother transactions between peers as all the member are trustworthy and checked.
After verification, members can utilize the smart contract for transactions. A smart contract is an intelligent contract where a sum of credit or any other information is transferred when a specific condition is fulfilled. This is incredibly useful for peers whose identities have already been verified and they want to start a long-term business.
Proving Authenticity of Identity without Disclosing Information
Let’s say that an individual wants to prove the authenticity of his digital identity without disclosing any of the information to the verifier. This is where Zero knowledge proof (ZKP) comes in, instead of showing their identity documents to the verifier, the person is asked to complete some tasks which he/she will be able to complete if he/she is the person who he/she claims to be. If that person is not able to complete that task, then his/her claim for the identity is rejected.
The final scene of this procedure is that the verifier won’t have any information of the claimer whatsoever regardless of the outcome of the claim.
Reduced Verification Time
The orthodox verification procedures are extensive and time-consuming. It will be much convenient if these procedures are short and quick. There are so many steps in identity verification in today’s data management. Using above mentioned technologies, Blockchain offers to obtain identity proof and other documents more efficiently leading to reduced time for verification from hours to mere minutes.
Insurance companies can use smart contracts for quick verification of the claimer and dispatch the claimed insurance money to them quickly. This will help both the claimer in acquiring the money quickly and the insurance company to avoid any frauds.
TrustLogics is a new Blockchain-based platform for identity verification purposes. Our aim is to make a platform for verified jobseekers and recruiters. One of the major services we provide is background checks. Users can verify their education, criminal or even drug records. The verified profiles not only build a trust among the peers but also removes the need for third-party verification.
Utilizing a private Blockchain for data storage and a public Blockchain to monitor transactions, TrustLogics is developing a hybrid approach for our Blockchain solution. With a secured database, the power to control the shareable data and much more, TrustLogics is taking the identity verification process to a whole new level.
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