The Vow Of Managing Identity On The Blockchain

With a significant proliferation of cybersecurity threats, the urge of implementing blockchain technology as a route to ameliorate identity management grows stronger. It offers the promise of a reliable record that can potentially reduce fraud. Over the coming years and as per some industry experts, blockchain will widely be used in a more secure fashion to control identity information.

As we dig deeper, blockchain can render people with more proactive authority over their data and make it more strenuous for unapproved users to exploit it. Many industries are now traversing more decentralized data management systems and in extreme cases, merging up with government organizations and financial services to mitigate the perils of large-scale identity fraud and cyber-attacks. They are also coming up with efficient ways to provide individuals with an access to the solutions that demand valid identification and somehow they are turning out to be more streamlined than the current KYC processes. In this article, I’m breaking down the information into pieces so that it's easy for you to understand how vital blockchain is for identity management.

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What Is Blockchain?

As the name already speaks for itself, blockchains are digital ledgers that utilize cryptography to store blocks of data that are chained together chronologically with the help of virtual networks that are distributed all over the world. The copies or impressions are stored on the server, thus, making it back-breaking to falsify the information.

Since blockchains are not centralized and are not managed by a single organization, they are crafted to be tamper-proof and immutable. Therefore, fraudulent incidents are very less likely to occur or never to occur at all.

How Can We Use Blockchain For Identity Management?

There are a lot of industries that are currently leveraging blockchain technology to efficiently manage their data services. However, to sustain data management, this is how we can advance to a smart, secured, and a better future.

Government IDs

Many countries like India and Estonia are experimenting with the centralized digital IDs. An individual’s identity can be used to file taxes, vote for any political party, register property, withdraw funds and finances from the banks, and adhere to other government reporting requirements. Since these IDs are furnished by governments, the data gathered is saved in a centralized database. Such centralized networks create a highly possible single point of failure.

To secure and safeguard such information, extremely strict protocols and controls need to be put in place.

Blockchain Solutions

Blockchain ensures that a user’s single digital identity is saved in an incorruptible and secured manner. This single digital identity contains the most recent and up-to-date user information.

Given this prowess, businesses are now rushing to build blockchain-fueled services for digital identity authentication and management. For instance, Bitnation’s governance platform is aimed to impart similar solutions as a government. And for your much surprise, the users are termed as ‘citizens’ of Bitnation. Some more to include as an example that drives power from blockchain technology is the Hyperledger Fabric- it is basically a permissioned blockchain which entitles the users to assign permissions for who are to participate and access their digital identity data.

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Network Effects

No digital identity blockchain solution will be fruitful for institutions and enterprises without any buy-in from the customers. Many business sectors such as health care providers, credit card companies, and banks are now looking up to Blockchain-based identity management solutions and they are highly regulated. Distribution of nodes, possible projects on data privacy mechanisms, and development processes are going to be essentially vital for the road of success.

With blockchain technology, the identity management has a lot of scope amongst every possible industry in the future. What do you think about it? Write down in the comment section below!