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What Is Digital Identity In Crypto?

Digital times call for digital measures

Our identity is proof of our existence to be able to integrate ourselves into the normal functions of society and economy. It is our identity that makes us acquire ownership and claims to valuables, properties, things, and a lot of other intangibles such as the ability to transact with others.

Enter Digital Identity Management

Upon the entrance of digital technology into humanity’s realm, personal identity management has become necessary that identity owners are now seeking to manage it themselves in their online and offline activities. The accumulation of identity is the big data that is serving as a commodity that corporations have built their infrastructures upon. It has now become a major concern for them as issues of privacy security, and usability is on the rise. Expenses to protect high-value data are growing from $8 billion in 2016 to an expected $15 billion by 2021 since data govern interactions in the digital world. Big corporations and businesses have no way but to deal with it or else customer experience will be highly compromised.

Trends

Our digital identity is increasingly found in the many apps and services that we come across in an interlink of interactions. Three trends emerge:

  1. Decentralization to empower the identity owner.
  2. Increase the access to economy and develop efficiency of social services.
  1. Federated identity systems. It is where interoperable systems make institutions trust-anchors with their stand-alone systems. The primary data entered in one institution can be accessed through regulation by other institutions to confirm the identity of an individual of secondary nature.
  2. Decentralized identity systems. This is where the identity owner over his or her identity is stored in a centralized identity hub for general purposes. It will be a source of credentials for any institution needing proof of identity of a person after being validated by the identity owner to access the hub.

The Blockchain Solution

Using blockchain technology in managing identity systems can be an effective tool in mitigating confounding issues like identity fraud, data insecurity, and inaccessibility.

Identity Fraud

The digital identity landscape is fragmented in a way that users employ different usernames across different platforms. A weak link exists between offline and digital identities making it easy to create a series of fake identities. Thus, it can lead to interactions of fraud causing lost revenues and inflated numbers, including the dissemination of fake news.

Data Insecurity

Personally identifiable information (PII) is the most targeted data for breaches and hackers are feasting on centralized government databases operated by legacy softwares with a number of single points of failure. Consumer data are exposed by the billions with worth of hundreds of billions lost.

Inaccessibility

There are about 1.1 billion of the world’s population that do not have any proof of identity, and 45% of them belong to the poorest 20% on earth. Poverty, lack of knowledge, and cumbersome processes keep them outside of conventional identity systems. Without identity to show, they often cannot apply for jobs, or enter school, or open a bank account.

Conclusion

In these digital times, much has changed in the management of identities and their importance now cannot be overemphasized. Via blockchain technology, identity management solutions are at hand to hand you back control over your personal data out from the hands of industry giants. Refugees who are at a loss with many identity issues can now be addressed such as no country, no documentation, no money, no bank account, no property ownership, no business. Being a non-entity excludes you from any societal participation. Bureaucratic processes can be eliminated in acquiring passports. Patient data security is enhanced to prevent data breach of sensitive medical records. Intellectual property is also protected and Know-Your-Client procedures are simplified.

Written by

Your fiat and digital asset custodian. Bridging the gap between Banking and Blockchain.

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