Bitcoin as a Security Layer
Recently, as I was flying out of Shanghai back home to Tbilisi, I was struck by the experience I had going through customs. Nothing of note occurred — my passport was checked, I was asked a few questions and then sent through to catch my flight. This process has become much more digital in the past few years (passport scanners to check for forgeries, etc.). But we are still relying on a booklet of paper to verify who I am.
This is a problem with many assets we consider valuable — they are paper-based and our trust of them lies on the assumption they have not been altered. But what happens when the information these pieces of paper represent live solely online? Will we be able to trust it in the same way? I believe the answer is yes — but only if we dramatically improve our cybersecurity. One way to do this is through bitcoin. Bitcoin is many things — sound money, a better way to transact — but it can also be an additional layer of security.
Anything recorded on the Bitcoin Blockchain is recorded permanently. It cannot be altered or deleted. Right now, most of what is recorded on the Bitcoin Blockchain is bitcoin transactions. But you can attach information to these transactions. The information cannot be too large (like a whole passport), but there is enough space to record a digital signature.
A digital signature is an unhackable “fingerprint” of a document that considers the document’s information, its creation date, its last date of alteration and other factors, and computes it into a string of letters and numbers. If even one letter in that document changes, the digital signature would change. For example, if my passport had a digital signature, and someone tried to change my name or nationality, the signature would change. If I were to publish my passport’s digital signature onto the Bitcoin Blockchain (attached to a tiny transaction of a single satoshi), it would be securely recorded forever. I could instantly prove if someone altered my passport by referring to the digital signature recorded online.
What we are talking about here is an evolution of the internet, our “worldwide web.” Now we have the Bitcoin Blockchain, a worldwide ledger, that is immutable, trusted and maintained by a global community without any centralized control.
Bitfury has already begun using the Bitcoin Blockchain as a worldwide ledger in our work in the Republic of Georgia. We started computing digital signatures for Georgian land titles and recording the signatures onto the Bitcoin Blockchain (this was done using the Exonum timestamping service, which you can demo here). This didn’t release any private information, but it did give Georgian citizens extra proof that their land title was accurate and had not been altered without their consent.
Our world will soon run on entirely digital processes, but much of our lives still rely on paper-based systems. It is time we switch from paper-and-ink signatures to digital signatures — especially digital signatures backed by the security of the immutable Bitcoin Blockchain — for our most valuable pieces of information. This will make our adjustment to a fully digital world much easier in the coming decade.