Governments Are Adopting Self-Sovereign Identity In A Positive Move For Privacy

The following is a contributed article from a content partner of Benzinga

Digital identity is already a reality in many countries like Estonia, where 98% of the population has their own e-ID card, enabled by near-universal internet connectivity and virtual signature schemes. However, digital identity is only a concept for people in many other nations.

The very idea of digital identity can also be highly controversial. Privacy advocates tend to take a cynical view, concerned that it means governments can track every move of their citizens. However, blockchain technology is now providing a middle ground.

In particular, blockchain platforms such as the enterprise-focused Concordium use a cryptographic technique known as zero-knowledge proofs to help ensure that digital identities are self-sovereign. This feature allows people to retain control of their data in almost all everyday scenarios requiring an ID. 

Why Do We Even Need Digital Identity?

The events of 2020 have created a more compelling use case than ever for digital identities. Now that a COVID-19 vaccine is on the horizon, it seems almost inevitable that a health passport, proving that we aren’t a viral threat to others, will feature in our futures. Australian air carrier Qantas has been at the front of the pack of companies stating they’ll require an immunity certificate for a flight booking.

Furthermore, the health crisis underscored governments’ challenges in identifying individuals who were eligible for relief payments. One report from the UK estimates that around £1.5 billion ($2 billion) will be lost to fraudulent welfare payments.

But the benefits of digital identity extend far beyond the challenges of 2020. In its paper titled “Reimagining Digital Identity: A Strategic Imperative,” the World Economic Forum points to a diverse set of sectors that could be vastly improved by the existence of self-sovereign digital identities. From food and sustainability to the agility of humanitarian responses to better user experiences on social platforms – the list is extensive. 

So What’s Being Done About Self-Sovereign Identity?

Many countries are in the research or development stage of implementing a digital identity scheme. These include Australia, Canada, Thailand, and the Philippines, among others. However, a critical feature of digital identity is whether or not it’s self-sovereign.

A self-sovereign digital identity (SSID) enables individuals to choose who uses their data and for what purpose. Blockchain is one of the core enabling technologies underpinning the implementation of SSID because blockchain equips an individual with their own encryption keys. These keys are the feature that gives someone control over their data usage.

Two of the biggest blockchain-enabled SSID initiatives are taking place in India and the EU. In India's case, the India Stack project aims to equip every Indian citizen with their own Aadhaar – a unique digital identifier. The system has been in development for the last eleven years and, over that time, has come under fire for using centralized systems. However, the project is now looking to incorporate blockchain for functionality such as elections.

Elsewhere, the European Self-Sovereign Identity Lab (eSSIF-Lab) is working to establish SSID technologies into a scalable infrastructure used by businesses and governments across the EU bloc. It’s part of the European Blockchain Services Infrastructure, a network of nodes in the EU that’s aiming to deliver cross-border public services. 

Privacy-Centric Blockchains Are the Only Solution to SSID

Any digital identity scheme risks failing if citizens aren’t convinced that it won’t be used for covert monitoring purposes. The varying success of COVID-19 track-and-trace schemes has already proven this to be the case.

Several blockchain-based applications are attempting to address the SSID challenge. However, so far, Concordium is one of the only platforms that provide an identity solution built into its technology stack.

Moreover, Concordium is also the only public blockchain with a mechanism for ensuring the authorities can identify someone in case of legitimate legal need. It uses zero-knowledge proofs to verify a user’s credentials, but without the verifying party needing to see the credentials for themselves. Concordium is currently operating its public testnet and is performing well with over 3,000 users creating their SSID on the platform.

A user can open a Concordium account by providing their ID to a registered identity provider, who uploads a zero-knowledge proof to the blockchain. The user can then transact in privacy, with the counterparts to their transactions assured that they’ve been verified.

In practice, this means that an individual could use their blockchain-based SSID to prove elements of their identity without disclosing who they are. For example, they could buy age-restricted products, and the merchant would be assured that the customer meets the age criteria without knowing their birthdate.

Similarly, in the COVID-19 scenario, an airline could verify someone has passed an immunity test without knowing whether they became immune through vaccination or post-infection antibodies.

If there were to be an outbreak of COVID-19 among the flight passengers, the authorities could make a legal request to identify passengers for track-and-trace purposes. In this case, Concordium uses another third party called an anonymity revoker, who can instruct the identity provider to reveal the flight passengers' identity. However, nobody can revoke anonymity in isolation. For almost all everyday purposes, the users retain complete privacy. 

Decentralization is the Key to Citizen’s Data Autonomy

Concordium isn’t the only project aiming to solve the SSID challenge. Ontology is another blockchain platform with an identity layer built-in. However, the platform is currently focused on use cases within the automotive sector. It’s aiming to ensure that car drivers can be identified for the purpose of micro-payments, vehicle leasing and finance, and insurance claims.

A decentralized SSID is the only clear means by which citizens can benefit from digital IDs without handing over complete control of their autonomy to governments, who may not always have their best interests at heart. From the government perspective, blockchain is the only way to assure citizens of privacy to the extent that any digital identity solution will gain widespread adoption. The question is whether or not this can be achieved in time to help alleviate the challenges of the next large-scale health or humanitarian crisis.