Why Digital Identity May Only Be the Start to a Decentralised Identity Architecture

Digital identity denotes any personally identifying data that can be traced back to a real user. For example, photos uploaded on social media, posts you’ve commented on, your search engine, your online bank account — and yes, if you’re a gamer, your Steam Account too.

If you’ve ever used the internet to create a social media profile or an email account — like most of us have already done — then voila, you already have a digital identity. Digital identity is taking a new shape in organizations, businesses, and the daily lives of digital consumers and social media users.

Digital Identity In Organizations

Organizations often collect sensitive consumer data such as personally identifying information, SSNs, addresses, residence numbers, clinical and employment history. Most of the personally identifiable information gets mixed up with less sensitive routine business data, thus creating new risks. Therefore, when these sensitive data are relegated to tight-lipped vaults, they become less important in driving product development decisions and attaining true customer understanding.

Digital Identity For Interconnected Devices

There are approximately 22 billion devices connected to the internet right now — and this number is expected to reach 35 billion by 2025. The IoT industry is a relatively new sector, thus representing identity and access challenges. According to new and emerging cyber incidents, it is becoming increasingly important to create IoT devices that can identify and monitor online activities and manage access to sensitive and non-sensitive data in a secure and protected manner. Therefore, IoT devices find themselves at the center of digital identity.

Data Identity For Individuals

Personal identity data denotes personal information like names, addresses, credit cards, and job status. For individuals, identity is underscored by specific identifiers such as passport numbers, social security, and driving license numbers. These data points that denote any form of identity are given by centralized authorities and stored in databases. Therefore, IoT is emerging as an exciting development in the digital identity landscape, particularly for billions of people who use the internet regularly.

Blockchain Development

Blockchain has signaled a new wave to digital identity architecture. This is particularly because the growth of digital identity has presented cyber incidents whereby cyber attackers are sniffing around social networks to identify loosely protected profiles. With blockchain technology, digital identity is taking a new shape as features such as decentralization, immutability, and shared usage find their way into this new exciting architecture.

Although blockchain represents a fundamental development in the future of cryptocurrencies and the digital identity landscape — it is a technology that has existed for quite some time. Blockchain came into the spotlight through Bitcoin, and its applications have skyrocketed to fashion, art, music, and digital media through mediums like Ethereum and NFTs.

The first feature that makes blockchain a solution to digital identity is incorruptibility. Every node on the blockchain network has a copy of the digital ledger. To add a transaction, every node has to verify the validity of that transaction before it’s secured in the blockchain. If the majority of the shared users think it is valid, this particular transaction is then added to the blockchain system. This feature makes blockchain corruption-free and promises transparency.

The blockchain architecture is decentralized, which means it has no central governing authority. Instead, a group of nodes maintains the entire network making it a decentralized architecture that is accessible immediately after verification. The decentralization of blockchain provides flexible operational controls, accessibility and enables users to feel they are part and parcel of their data protection architecture. The traditional centralized systems were archaic, old, and outdated — most importantly, they made consumers feel they had no control of their information, data, or otherwise.

Blockchain technology has defined the digital identity landscape due to its enhanced security. Since the blockchain system eliminates centralized authority, no user can simply alter the character of the network for their benefit. In addition, the use of encryption ensures an additional layer of security. Given that digital identity relates to users’ personal information left on the internet, it is clear to see why enhanced blockchain security might just be the solution to digital identity compromise.

Consensus is a critically underpinning feature of the blockchain architecture — indeed, every blockchain thrives because of an embedded consensus algorithm. Every blockchain embeds clever algorithms to ensure it makes the right decisions. This shared responsibility in the pursuit of information integrity remains critically underpinning in looking at digital identity as just one component of the decentralized architecture.

Blockchain Applications

Blockchain healthcare is slowly becoming a new frontier in healthcare. Healthcare data could be encoded and stored in the blockchain with a private key that would only grant access to specific authorized users.

Key problems roping the music industry include copyright issues, transparency, and royalty distribution. The digital music sector focuses on monetizing productions, while ownership and copyrights are often overlooked. Blockchain and smart contracts can circuit these problems by creating a decentralized architecture of music rights.

The government blockchain is emerging as a new development to oversee the integrity of public information, data, and public processes. In 2016, Republicans and Democrats questioned the integrity and security of the voting system. The Green Party called for the recount of Pennsylvania, Wisconsin, and Michigan votes citing rigging of the electronic system and manipulation of votes.

How Decentralized Identifiers Work

Blockchain proves to be a gamechanger to the decentralized digital identity architecture because blockchain allows users to manage digital identities through the following elements: identity management, decentralized identifiers, and embedded encryptions. When users sign up to a self-sovereign platform, they use private, and public keys associated with a particular DID decentralized identifier.

The DID provides a private key that a particular identifiable user or an authorized party can use to access their information or particular shared digital resources or digital assets. As a result, looking at blockchain technology, we can see that it gives birth to new and exciting developments like decentralized identifiers that are better and safer models of identity management.

How Blockchain and Digital Identity Define The Future

Many industry leaders are taking action from the front with a growing concern about cybersecurity, service automation, and a shift from on-premise to cloud storage. New blockchain-based projects are popping up and solving the inefficiencies of the existing world. An exciting blockchain-based project of 2021 is TradeLens, the enterprise blockchain for AP Moller-Maersk. The Denmark-based shipping giant uses its blockchain TradeLens for the digitization of the supply chain and warehousing information.

China is one of the most prominent regions showcasing promising growth in blockchain-based technologies. The Chinese search engine Baidu and its associated fintech venture known as Du Xiaoman Financial have pulled together over twenty blockchain solutions. The most notable mention among the blockchain project ideas generated refers to the Libra Chain. Currently, Libra Chain is the infrastructure for three internet courts in China. The courts use Libra for e-commerce and copyright issues through virtual litigations.

Another big enterprise that has made an entry among the top blockchain ideas is the SkyGrid of Boeing. Boeing’s venture arm Horizon X has invested considerably to develop SkyGrid: a blockchain-powered air traffic control system that tracks and manages communications with drones. The SkyGrid has met the minimum KAA operational requirements for low-attitude authorization of drone pilots.

The decentralized blockchain architecture shows that digital identity is just but one of the very many capabilities of this integrated and shared architecture. With blockchain, hospitals are improving their patient privacy and confidentiality. Banking and financial institutions are improving customer communications and bolstering their long-lost customer trust.

Is Digital Identity the Start of Decentralized Identity Architecture?

With the rapid growth of new forms of blockchain, sectors like fashion, beauty, e-commerce, and digital media are finding new secured capabilities. In fashion, blockchain helps to secure unique creations by leading brands, and in gaming, blockchain provides a secure system to protect gamers’ identity and to secure any in-gaming transactions. These and many multifaceted applications show that digital identity is just but the start of decentralized identity architecture.

Digital artist and 3d generalist