A Closer Look at the Real-World Applications of the Blockchain for Digital Identity Already Underway
A Closer Look at the Real-World Applications of the Blockchain for Digital Identity Already Underway
Digital identity is one of the many real-world blockchain uses that proponents frequently point out. Having some form of identity is crucial, and most people agree that there are issues with our current passport systems.
Why Blockchain Solutions Are Necessary
Refugees forced to flee their homes can lose the physical documents. Anyone can lose their identification documents in a fire or another disaster. There is also a lack of universality since some jurisdictions have varying forms of identity. Those problems have led to a desire for a uniform digital identity that you can easily access wherever you are.
There is also the issue that many people around the world simply do not have access to any sort of identity, digital or otherwise. Someone without an identity cannot open a bank account, travel internationally, or do any other number of things that most of us consider to be a part of normal life.
However, many people have concerns about the security of that digital identity. After all, no one wants to have their personal information stolen or exposed. This has only been worsened by recent events, such as the Equifax hack and the Cambridge Analytica data-sharing scandal for Facebook.
Those in the blockchain space also hope that it can help prevent and identify identity hacks and theft. Identity theft occurs more frequently than most people realize. For example, statistics from 2014 indicate that around 17.6 million Americans, or 7 percent of those at least 16 years old, were victims of identity theft that year.
The Appeal of the Blockchain for Digital Identity
When it comes to finding solutions for these identity issues, there are multiple reasons that the blockchain seems to offer the perfect solution. The most notable are its decentralization, immutability, and transparency.
Because the blockchain is decentralized, there is no single centralized entity in charge. This means that no single group or person is in control of your data and identity. Instead, every node holds the data. This decentralization helps prevent corruption, as well as hackers trying to alter information.
The immutability of the blockchain further prevents hackers from changing information. Once data is in the blockchain, there is no way to change it thanks to the cryptographic hash functions. This helps guarantee information accuracy in the future, assuming it is entered correctly initially.
Finally, the transparent nature of the blockchain means that each network node can view all of the data. Since everything is viewable, it is impossible to hide data for unscrupulous reasons.
Additionally, the blockchain overcomes some of the obstacles that traditional technologies face when attempting to create digital identities. For example, the blockchain can make it hard to replicate digital units. It also can make digital processes and files tamperproof.
Commonalities in Digital Identity Solutions
Although the various blockchain solutions for digital identity vary greatly in specifics and purpose, there are some commonalities. Most importantly, everyone has a digital identity (abbreviated as DID), as well as a private key to put them in control of that identity. From there, the solutions tend to take different approaches.
With that information in mind, take a look at some of the real-world applications of digital identity in the blockchain that are already in progress.
Aries from Hyperledger
Back in May, Hyperledger announced its project, Aries. This is a toolkit designed to help with identity management on the blockchain. Anyone can make use of this open-source framework. It is important to note that while the project itself is not a blockchain, it is a way that others can more easily use a blockchain to create digital identity solutions. Aries is essentially a method that lets developers create verifiable and interoperable credentials to ensure secure communication.
The idea is that there are no intermediaries involved when logging in with Aries. This is crucial since intermediaries could spy on and record your details. According to the team, the tools from Hyperledger are already used for building government identity projects. One of these, the Verifiable Organizations Network, had issued more than 10 million business credentials as of May.
The Aries project from Hyperledger features a cryptographic wallet, a blockchain interface layer for the blockchain transactions, an encrypted system for messaging, ZKP-capable W3C-verifiable credentials, a Decentralized Key Management System, and a tool to build API-like use cases or higher-level protocols.
Bloom offers applications for Android and iPhone and lets users create an identity that is powered by the blockchain and cryptographically secured. The project offers a full end-to-end protocol that allows for credit scoring, risk assessment, and identity attestation. It hopes to appeal to both traditional lenders and those who lend digital currencies. The team also hopes to aid the millions of people around the world who are unbanked.
Among the various real-world digital identity projects already underway, this one is unique in that it focuses on applications for lending and credit, instead of general identity. The project aims to reduce or eliminate current problems with credit infrastructure, including identity theft, cross-border credit scores, assessments of creditworthiness, and the centralization of credit data. The Bloom Protocol has solutions that let lenders securely and safely issue credit to borrowers who authorize them.
Building Blocks is a collaboration between the World Food Programme and the UN, designed to improve the tracking and distribution of aid. It began with a one-month pilot in the Azraq refugee camp in Jordan. Over 10,000 inhabitants of the camp participated in the pilot, which let them access accounts with biometric scans. From there, the pilot expanded, and Building Blocks hopes to continue expanding to help more people around the world.
By using the blockchain, WFP can reduce costs and delays in funds since there are no intermediaries involved. This also reduces the risk of issues like financial mismanagement. Building Blocks uses the blockchain to reduce the costs by eliminating fees, while also providing digital identities to refugees and others.
Civic is located in San Francisco and is a self-sovereign identity system. Users of this system can then share their digital identity information with the companies they choose. The Civic platform has a convenient mobile application to input the relevant information, which is encrypted automatically.
The project offers multifactor authentication without any need to use physical hardware tokens, passwords, usernames, or third-party authenticators. A third-party wallet generates the keys, so there is a firewall that prevents Civic from viewing the user keys.
Civic is working to develop partnerships with validators like banks and governments. These validators would verify the information submitted by users and then leave a blockchain stamp indicating the information is correct. A Civic Wallet is also on the way.
Like Bloom, Colendi is a working digital identity solution that focuses on credit and lending and uses the blockchain. It offers blockchain-based global identity and evaluation of creditability. It offers a decentralized scoring protocol for a lack of bias in the results. The entire risk assessment process is free from banks and it provides users with a global creditability identity. As with Bloom, Colendi has the potential to specifically help the unbanked via its version of digital identity.
Digital ID is a Thai project for digital identities on the blockchain. It already has the backing of the various official Thai government agencies, including the SEC, credit bureau, and Bank of Thailand. The project aims to connect identity verification across sectors to help reduce various obstacles within the country. This project is on a limited scope, and most of the information about it is solely available in Thai. Even so, it helps show the reach of blockchain solutions for digital identity.
Everynym is also working to offer self-sovereign ID services. The company has already begun real-world trials, including working on a pilot with Illinois. The pilot focuses on recording birth registration data using decentralized identifiers in the ledger. This setup should let third parties access the data as long as they have the necessary credentials.
Like many of the other projects on this list, Everynym offers a reasonable amount of open-source code and resources. However, not everything is open-source, as this is a private company. The standards on Everynym are also open and interoperable, meaning that digital identities can be moved or used across applications in the future with ease.
IBM Verify Credentials
IBM is known as a leader in the world of technology, so it is no surprise that the company has a digital identity project well underway. IBM Verify Credentials is already available as a free alpha version, and the company says it is a way to turn digital identities into decentralized identities.
The project aims to create an ecosystem that individuals can trust with their information. It does so by making it possible for trusted organizations to give individuals credentials, which those individuals can then choose who to share with. Companies can use the IBM Verify Credentials to remain compliant with privacy regulations or confirm identities before password resets.
ID2020 is a system that Accenture and Microsoft developed together. This blockchain-based ID system hopes to revolutionize legal identification. Each person gets a decentralized digital identifier that they can then use for things like health insurance, banking, and travel.
The goal behind the project is to close the identity gap by making it possible for a range of organizations to choose the same approach. The project works as an alliance that ensures the digital ID systems always include individual control, security, safety, and interoperability.
Lynked.World is based in the Netherlands and makes use of the Ethereum blockchain to offer ID verification, as well as verification of education and profession. In December 2018, the company made headlines when it created the first blockchain-based birth certificate in India, thanks to a partnership with the Kolkata municipal government. There are also numerous other major partnerships in the company, which will allow for issuing passbooks and digital ID cards.
MyPass Austin is an identity management test pilot that the University of Texas’s Dell Medical School, Austin-Travis County EMS, and the City of Austin ran. It used software from BanQu and ran on a permissioned Ethereum network. The pilot program is a blockchain-powered identity system specifically designed to help those who are experiencing homelessness. The idea is that maintaining your important identity documents is hard enough with a home but even harder when you do not have one.
Persona is a zero-knowledge digital identity management system that is built using the blockchain. The project’s Trust Protocol is now in its beta release, showing that the project has already come a long way. The project also prides itself on lining up with the most recent security regulations.
The project hopes to empower individuals to be in control of their personal data and give them the ability to easily secure their private details. The idea is that everyone would be in control of their own private identity. Using Persona, people can prove their identity without having to share private details. This translates into sharing as little data as possible when accessing services.
Sovrin Network is an open-source project that aims to create a public utility that lets people make use of a self-sovereign identity globally. The code uses Hyperledger Indy as its basis but is a unique project. Sovrin is a nonprofit group, and its project is among the first networks in the world for self-sovereign identity.
Sovrin Network describes itself as setting the new standards in the world of DID, allowing for personal control, trust, and ease of use. Sovrin serves as a metasystem that any application can use in its own way.
uPort is based in Brooklyn, New York, but is working in partnership with Zug, Switzerland’s government, for a trial run. uPort’s blockchain project is a smartphone application that allows for self-sovereign identity and works on the Ethereum blockchain. As such, it supports smart contracts, decentralized applications, and virtual currency transfers.
The trial is looking to develop digital identities for use in government services. Those who participate can create a uPort ID then verify the information in person at a city office with their physical identity documents. This process will verify the digital ID that is on the Ethereum blockchain. In the future, those who have this verified ID can use it for e-voting or proof of residency.
Within or outside of the trial, those who use uPort can issue reusable credentials or request credentials. The company also offers a range of products already in place, including the self-sovereign wallet, the ability to issue credentials, Connect for SSO, and simple authentication for modern web applications and dApps.
These are just a small sample of the blockchain projects already underway with a focus on revolutionizing digital identity. There is no doubt that more of these projects will appear soon due to the unique ability of the blockchain to address digital identity challenges. However, it is unclear how long it will take for at least one blockchain digital identity project to become mainstream.