Reminiscing the past years of blockchain’s history, we have seen various innovations stem from blockchain technology, trying to address alternatives to centralized control. Such innovations include Bitcoin, which some people claim to be the store of value similar to gold and Ethereum, a sophisticated computing platform trying to create a decentralized infrastructure for running applications and incentivizing work. Whether by intention or happenstance, these early cryptocurrencies have led to a completely unique asset class in the history of financial system- a digital asset where users can transact freely without the need of central mediators.
Blockchain technology sparked sensational headlines in the media at the end of 17’, which led to a huge spike in price. However, the speculative bubble was short-lived. Many investors pulled out of the market when they found out the hype far outweighed its potential. When the run of ‘irrational exuberance’ finally came to a screeching halt, many blamed the lack of ‘killer dApps’ as the leading cause of failure for mass adoption.
Among many reasons to blame for the failure of blockchain adoption, there is one essential problem that is being overlooked- which is the lack of trusted identity. Having a verifiable identity system is critical, even more so in the decentralized network. The internet, in its early days, went through a similar trial when creating a protocol for identifying persons and organizations. Since the internet does not have a central checkpoint system to verify someone who logs online, every service provider was forced to build their own meaningful identification database from scratch.
While the Internet grew rapidly over the years as more people use the services online, the amount of security issues rose at the same rate due to centralization of data. Social media giants like Facebook, which has more than a third of the world’s population as registered users in the company’s database, has incentivized people to connect with others at the expense of privacy. It attracted massive public criticism when Facebook was blamed for allowing a third-party app to gain unauthorized access to its data. This clearly shows the kind of repercussion it can leave on end users when online businesses rely on a central repository of identity data. If you want to check whether or not your e-mail address has been breached, you can easily find out by typing your frequently used e-mail address to this site. You will be surprised by how many companies’ databases have been compromised.
As a response to the cohort of problem surrounding data vulnerability, many are looking to blockchain to revolutionize digital identity. The two distinctive properties of blockchain, immutability and transparency of data, can provide a back-end support to the decentralized digital identity service (also known as DID). At the final stage of decentralized identity, we can expect individuals to be the ‘rulers’ of their identity. Any sensitive data can be stored in people’s devices and allow use and access of services by providing only the attributes values (e.ge. age, location) required to use.
Many companies are figuring out ways to implement Decentralized ID to provide a global utility of trust to the Internet. Companies like IBM, Sovrin, Ockam, Aversafe, and Trustedkey are already working on building a decentralized identity framework using Hyperledger system. At the governmental level, EU has already proposed regulatory standards for using digital identification and trust services within the member states. Moreover, Google has already filed a series of patents related to digital identity on mobile devices.
SymVerse has been working on their own version of digital identity management system (DIMS) under the concept of self-sovereign identity (SSI). Self-sovereign identity is an alternative method to identity management in which individuals take full control their identity. It utilizes an efficient account management system called SymID. In the next coming article, I will cover the details of decentralized identities and SymID more in depth.
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