Blockchain-Based Digital ID Systems Are Increasingly Finding Real-World Use
Blockchains and digital IDs are moving beyond hype, and bringing real benefits to individuals and organizations.
According to the latest estimates, we generate around 2.5 quintillion bytes of data every day. That's 2.5 followed by 17 zeros — or rather 2.5 trillion million — a number that's impossible to visualize intuitively, but nonetheless has massive implications for our privacy online, our security and our ability to keep our digital identities within our own personal control. Indeed, recent surveys indicate that as many as 89 percent of consumers believe that corporations currently aren't doing enough to protect their data, while over half of all CEOs and C-suite executives admit that most consumers are right to doubt them on this.
Given the overwhelming scale of this problem, there's little chance it will be resolved overnight. However, as Cointelegraph reported in an analysis last year, a growing number of blockchain-based platforms have emerged with the promise of making the data related to digital ID more manageable. Thanks to the emergence of blockchain technology, a new paradigm — self-sovereign identity — is now possible, one which is shaping up to provide individuals with direct control over the nuggets of data and the credentials that prove who they are. Organizations such as the Sovrin Foundation, Bloom and Civic are all vying to realize this paradigm, while an expanding range of private and public institutions are now planning to build blockchain-based systems of their own.
There is, then, plenty of evidence to indicate that the hype of 2017 and 2018 is now bearing fruit when it comes to blockchain and digital identity. However, as encouraging as it is to see the new blockchain-based platforms actually being used, the sheer profusion of these platforms presents problems of its own, insofar as it could make it harder to arrive at the kind of universal system of digital ID the companies featured in this article are working toward, in which digital ID and personal data isn't siloed.
Blockchain and digital ID platforms have already come a long way since last year. This is evident in the number of notable organizations that have recently involved themselves in the sector. In January, the Iceland-based ID verification platform Authenteq revealed that it had secured $5 million in a Series A funding round led by Draper Associates — which, in the past, had invested in Tesla, Skype and Baidu. That same month, the chief executive of the Canadian Bankers Association (CBA) stated that it was favorably investigating the idea of using a blockchain-based solution as part of the open-banking ID system it was planning to develop.
2018 brought other examples of governmental and commercial interest in blockchain-based ID, including from the European Union,