Blockchain: An Answer to Identity?
While finance is one of the most talked about use cases for the blockchain, it is certainly not the only one. There are plenty of other industries that are ripe for disruption for this new technology, including identity.
Matthew Roszak, Founding Partner of Tally Capital, said: “Think about the issues involved with signatures, voting registration, birth certificates, passports and the like. Being able to create a permissioned identity stack for consumers and businesses with unprecedented levels of security, privacy and control can be very powerful.”
Consider the following scenario. You walk up to a bar, but the bouncer stops you because you look like you may be under 21. He asks to see your identification. Currently, you show him your license, which has your name, age, eye color, height, address, and an identification number on it. Now the bouncer has a considerable amount of information about you despite the fact he only needs to know if you are 21 years old. But take it a step farther, how is the bouncer 100 percent certain that the license is legitimate?
With the blockchain, you gain access to two things. On one hand, you could select only the pertinent information required for that transaction—and entering a bar through a bouncer is a transaction. In this case: name, picture, and age. On the other hand, the bouncer can rest easy knowing that once something is hashed into the blockchain, it can’t be changed; new information can only be appended and there is a transparent record of all changes.
The user controls how much data they share and the business has peace of mind that the data is immutable.
Shocard is one company planning to achieve this is. Shocard allows anyone to scan an identification document, such as a license, and then digitally sign it. That information is then attached to a new private and public key, encrypted, hashed onto the blockchain, and then distributed across all the nodes. The identity, at this stage, now lives on the blockchain.
When you want to prove that you are the person you say you are, you utilize the Shocard application to pull the necessary information. If you take it a step farther, you can attach this sort of digital identity to a credit card, allowing you to approve every purchase that is made; if you didn’t make the purchase, the card gets declined.
Onename is another company looking to tackle identity on the blockchain. The company hopes that, with its Passcard product, you will be able to use a digital key for everything: your apartment, your office, and logins to different websites.
Consider that a username/password is only used to verify that you should have access to the information associated with that account. If a digital ID could do the same thing, a password becomes unnecessary.
Storing identification on the blockchain is in its infancy. But while finance remains one of the primary focuses, the rules that make the blockchain so powerful apply to many other industries. Once information is on the blockchain, it cannot be changed or counterfeited. Further, because no one entity controls the blockchain, each user controls his own data.