Identity refers to the qualities, features, beliefs, and traits that characterize a person and distinguishes them from others. It is the sum of features that make you who you are and sets you apart from other people. Identity in the world today is documented in some form and often issued by central governments.
Identity in the 21st century
In the world today, identity management is a key concern. About 1.1 billion people globally do not have an identity or access to claim ownership of an identity. A World Bank global identification study indicated that up to “40% of adults in low-income countries (LICs) do not have an ID.”
A large population of the world is connected via the internet, with 12.2 billion internet-connected devices recorded in 2021 and that number is set to increase to 14.4 billion in 2022. The global spending on internet-connected devices is also projected to reach $1.1 trillion by 2023. Due to this constant internet presence, Identity today consists of not just physical identifying documents but online distinguishing traits. Everything humans do now from shopping to medical care, to working is online or can be accessed online. Identity today is a combination including your Ip address, the clicks you make, passwords, and other data points and identifiers collected over the internet.
Despite the proliferation of digital technology, creating and managing digital identities is a feat too big to undertake for many businesses. The data collected from internet-connected devices is projected to get up to 79.4 zettabytes in size by 2025. As technology revolutionizes every aspect of human life, digital identity management becomes an everyday aspect of social transactions and big data management is in the future for most organizations. But constant data collection online makes data cumbersome to manage and many organizations lack the appropriate security management tools to handle customer identities and data. This data security is one of the many issues encountered when managing digital identities.
Another problem with digital IDs is the fact that customers often have no control or knowledge over how their identity and data are used. Currently available traditional identity systems are insecure and fragmented across several data management systems making management and control difficult.
Blockchain for Digital Identity
The advent of Blockchain and its distributed ledger system has paved the way for other technological innovations. Blockchain is an immutable, decentralized data storage system where data files are stored in linked and encrypted blocks. In clearer terms, Blockchain data is unchangeable once it’s recorded and no one central entity has control or access to this data. One major use of blockchain technology is creating and recording secure digital signatures. Blockchain technology allows users to create and manage their identities through decentralized identifiers and embedded encryption systems.
What are Decentralized Identifiers?
Decentralized identifiers or DIDs are verifiable digital identities gotten from autonomous, decentralized authorities. According to w3c in their DID draft published in 2021, “DIDs are URIs that associate a DID subject with a DID document allowing trustable interactions associated with that subject.”
Anything can be a DID subject-a place, organization, physical thing, idea, or anything else that has a digital presence. A DID document is the set of data describing the DID subject. Simply put, a decentralized identifier is a link that connects the information known (DID document) about an online entity (DID subject) to the entity instantly when requested. DIDs are made possible on blockchain technology.
The concept of DIDs is aimed at giving Internet users control over their identities and the ability to create unique identifiers using systems they trust. With DIDs you can have a cohesive identity across all internet platforms. Both enterprises and users equally stand to benefit from digital identification built on blockchain technology. Some of those benefits include:
- Control over identity:
With a blockchain-based identity management system, individual users are responsible for their data. Blockchain gives users the ability to provide external security and also control over who has access to said data. DIDs offer users a greater chance at control over the storage, use, and even potential monetization of said data.
- Security:
One of the key concerns of identity management is security. Everything connected to the internet is vulnerable to hacking. Identity documents contain all our data and insecure identity management systems leave individuals open to identity theft, fraud, and other security risks. How data collected is managed, and secured becomes an important question for digital IDs.
Blockchain technology and its encrypted system is offering better security for data storage. With an immutable, encrypted, and easily accessible data system, unauthorized access to stored individual data is nearly impossible. Identities built on blockchain technology are fundamentally safer than those stored on centralized servers.
- Ease:
In the world bank study on global identification cited above, some reasons cited for a lack of obtaining identification include the difficulty with getting one, with individuals finding the process too stressful. An inability to provide supporting documents for proper verification also factored in. Digital IDs will not only provide security but also ease. With the ability to create IDs online issued by a decentralized authority, people who find it difficult to process identifying documents or show up in person to obtain centralized government IDs can have a safe and secure digital ID. Digital IDs will also enable easier data portability and this will allow your ID and all the data attached to it to be easily transferable from one platform to another.
The future is in blockchain and distributed ledger technology. Everything from VR technology to currency is being built online and digital identification is a natural next step in securing this future. Organizations that value longevity and prioritize scalability are looking toward blockchain technology and what it has to offer them.
Here at Wajusoft, we’re building solutions and providing bespoke blockchain services and other engineering-as-a-service needs. We’re focused on building performance, business-driven solutions for our clients with a particular interest in new business founders who have no idea how to develop their ideas technically. Follow this link to book a free consult with the Wajusoft team today
