The Value of Information and Identity System in the Blockchain World
What is the Value of Information
Have you ever wondered what is at the core of the blockchain network? We can see it as the assumption of node behaviors.
The nodes in the network follow the assumption of the consensus algorithm and malicious nodes will be found out and punished, thus creating a trusted blockchain network and making the applications developed on the network also trustworthy.
However, we have to admit that the node accounting behavior of the blockchain network will lead to redundancy to a certain extent. As a result, the cost of recording information onto the chain will be very high. Certain conditions need to be met if general businesses are to completely use blockchain smart contracts, so blockchain applications are more suitable for high-value transactions, among which finance is most notable.
So, is finance the only application scenario of blockchain? The answer is obviously no.
To be more specific, we need to look at what blockchain is originally about. The blockchain network creates a benign competitive business environment, in which many high-value business scenarios are intertwined, which is also a potential service scenario for the blockchain. As the information is gradually being processed and circulated, its value also increases and users have control over their valuable data as the core of self-sovereign user data.
With users’ control over their own data, combined with blockchain’s tamper-proof and traceable features, the use and flow of data become transparent, and the value of users who own the data also increases. As a result, the identity of the data and user identity can be quantified. Further, with the development of IoT technology, machines can also own data and even identities.
It is in this context that the identity system of “people, assets, things, and affairs” came into being.
At the end of the day, the Internet is the interconnection of information, and its value reflects the value of Internet information. The blockchain is built on top of the distributed system technology and also has the characteristics of the Internet. So we can make the assumption that the value of the Internet can be realized on the blockchain.
The development of the Internet goes through two phases:
• Web 1.0: The creators of the information are not the owners of the information. The information is owned by the centralized information service provider, and how the information is used thereafter is not even known to the creators of the information;
• Web 2.0: With centralized platforms, a peer-to-peer communication network is created. The value metric of an Internet application translates into the value that users bring to the application.
In this sense, the blockchain identity system is simply the decentralized version of the account system in the centralized Internet system.
Ontology hopes to apply the distributed trust of the blockchain to the ordinary Internet applications through its identity system solution.
For example: if you want to go to a foreign country, you need to show your identity, such as your student visa or tourist visa as you enter the country. Customs will ask for the proof of your identity, and if you don’t have it, you are not allowed to enter that country.
Therefore, whether we should trust someone should be based on standard methods, rather than individual and arbitrarily decision. For many people, they can have many identities on the Internet. Some are real and some are fake, but people on the Internet are not even aware of this.
The Ontology Identity System (ONT ID) provides a complete solution for the traditional Internet application account system, giving back the control of the account system from centralized service providers to users themselves who can also manage their social network with ONT ID.
In our everyday lives, people are constantly producing and consuming data. The self-sovereign ONT ID allows users to have full control over their own data and the value of data and its potential market are indicative of the value of identity.
People will encounter different standards of trust in different social networks, which is precisely where the value of identity lies. Since you cannot be sure under what circumstances your identity will be valuable, the process of quantification is different from a fixed trust endorsement. When we choose to trust a person, it is because we are willing to believe that person, not because that person is endorsed by others. It can be said that, to a certain extent, this is a relationship determined by the buyer and seller. Virtual identity can be used to accumulate the credibility of identity during use. Then when you need to use it, you can use it directly, instead of building up your credibility from scratch all over again every single time.
In the Ontology identity system, the virtual identity is created by the users themselves, not by other people, and users can reveal different identities or part of the virtual identity to others based on their own choice.
Valuable identities use and in turn create value for application services. Different applications have different target user groups and need to be more precisely targeted. The Ontology identity system extends the financial scenarios in the blockchain to the broader Internet scenarios. As the value of identity becomes higher and higher, more and more users will use ONT ID, thus increasing the transactions on the Ontology blockchain. On-chain transactions need ONG as the utility token to motivate the node network and maintain the scale of the network. More ONG transactions will also help ONG circulate faster and increase the ONG rewards for ONT node staking while maintaining the ONG value. As a result, the ONT value will go up, which brings us back to the logic of Ontology’s dual-token model.
In this article, we briefly introduced the identity system in the blockchain world and the Ontology identity system. In future articles, we will share more details about ONT ID.
About the Ontology Research Institute
Ontology set up the research institute in order to focus more on the research and development of core blockchain technology and strengthen the ability to explore, reflect on, and apply emerging technologies, as well as make contributions to the entire industry. At present, there is more than 10 R&D personnel in the Ontology Research Institute.