Transmute Tech School 101: Decentralized Identifiers Provide Secure Supply Chain Visibility
In today’s digital world we are surrounded by identifiers around us — our email id, phone number, twitter handle, youtube handle etc. These are the identifiers we “rent” from the parties providing the services rather than “own”. This debate on where the ownership of identifiers lies is where decentralized identifiers come in picture.
What is a Decentralized Identifier?
Decentralized Identifiers (DIDs) are created, owned, and controlled by the same entity, giving individuals more control over their identity and businesses more control over their data. This ownership of the DID can be proved using cryptography. DIDs allow entities to control the privacy of their information, including minimal, selective, and progressive disclosure of attributes or other data.
Decentralized Identifiers have 4 properties that make them indispensable:
- It is a persistent identifier — You can keep it as long as you need it
- It is resolvable — You can look it up to discover metadata
- It is cryptographically verifiable — You can prove control over it using cryptography
- It is decentralized — No centralized registry or organization controls it
Decentralized vs. Centralized Identifiers
The truth is, depending on the situation you might not care if an identifier is decentralized!
GS1 provides a valuable service managing and distributing barcodes for products. Barcodes are all the same type of centralized identifier, which makes them easy to understand and use broadly. It’s not a problem if a barcode on a loaf of bread is a centralized identifier.
The problem with centralized identifiers is that they offer little privacy or control, which matters for both personal information and business information that needs to be authentic and traceable.
Centralized identifiers:
- Rely on a single body to validate your information. If Google goes bankrupt or stops working, I lose access to every website where I validate my identity using my Google username and password.
- Needlessly expose information. When I use my driver’s license to verify my age, I don’t need the verifier to also know my height or address.
As we think of scenarios to evaluate the need for centralized identifiers vs. decentralized identifiers we must ask ourselves these questions:
- How much control do we want on the digital life of the person and thing to which an identifier is given?
- What privacy trade-offs are we ready to make?
- How much security is good enough for the situation in consideration?
- How is this related to the identity of the person or thing to which an identifier is given?
Benefits of Decentralized Identifiers
By gaining the ownership of the identifiers that we control and own, we can:
- Create persistent communication across informational transactions in a human readable format.
- Prove ownership on assets and exercise the power to authorize or delegate actions to other parties in a verifiable manner.
- Digitally sign transactions or documents rooted in a trusted data source, with an identity you control.
- Port the identity from one service to another.
As we build the new trust layer of the internet, I strongly believe that the choice of who controls the identity should be with the individual or the organization in focus rather than in the hands of platforms and services that are today playing the role of the Identity Issuers or Identity Verifiers. Decentralized Identifiers are a critical piece in enabling this vision.
DIDs in Supply Chain
We have been working with large enterprises and regulators, especially US DHS-CBP to enable transparency and authenticity in cross border trade and supply chain logistics transactions through the use of Verifiable Credentials and Decentralized Identifiers.
The advantage of DIDs in supply chain comes into focus with questions regarding supply chain transparency and visibility, especially when many commodities are created from a wide array of raw materials, components, and parts. What is the origin of each of the multiple components in a single good, such as a cell phone? Who manufactured them? Who assembled them? DIDs can answer these questions authentically when multiple controllers inherit control over the DID throughout the supply chain. If DIDs are assigned to individual parts, and actors along the supply chain gain control over these identifiers, an aggregate picture of who created what can be constructed.
Assigning DIDs to commodities and each individual component within finished goods would provide unprecedented visibility into how things are made, allowing key stakeholders and end-users confidence to assert and assess the quality, origins, and marketing truthfulness of goods. Imagine being able to resolve a DID for a diamond in a ring and seeing exactly where the diamond was mined and if it was ethically sourced.
Sapan Narang, Director of Product, pushes the boundaries of what is possible with a rich blend of experiences across industries and a deep understanding of exponential technologies. Currently, transforming the world of supply chain and cross border trade with Linked Data, Decentralized Identifiers and Verifiable Credentials.
Connect with Sapan on LinkedIn and Twitter
About Transmute: Building on the security and freedom that Web3 promised, Transmute provides all the benefits of decentralization to enterprise teams seeking a cost effective, interoperable, planet-forward experience provided by experts in technology and industry.
Transmute was founded in 2017, graduated from TechStars Austin in 2018, and is based in sunny Austin, Texas. Learn more about us at: http://www.transmute.industries
