A Growing Fragmented Digital Identity Problem

 The World Bank reported that more than 1.1 billion people in the world are unable to prove their identity. As a result of this, they have little to no access to important services such as healthcare, education, social protection, and financial services. A solution to this growing problem is the digital identity that is able to access systems linked to the technological concept. Digital identity can give way to the aforementioned services, which are empowering in nature. 1.1 billion people in the world (and possibly more) are unable to progress in their lives as a result of not being able to successfully verify their identities. In most instances, the circumstances surrounding their inability to access their identity are totally out of their control.

The current systems of identity verification in the world have problems of their own too. One major problem is security. The problem with the databases that currently store the digital identification of people all over the world, is the fact that they are based on centralized systems. These are systems that all have a central point of failure. This means that should a database be compromised, all the data stored within it is at risk of being infiltrated. The current systems that are in place are littered with flaws and vulnerabilities – and this is in every industry.

Data Breaches is Now a Global Problem

Airbnb, for example, had to beef up their security after burglars were able to hack into their system, access the accounts of several hosts, and tamper with their personal information. Earlier in 2017, a group of robbers infiltrated the Airbnb database and managed to rob the houses of several hosts, who had shared their information online.  The Airbnb database houses over 40 million users’ information – credit card information, residential details, and other personal data. If a cyber attack were to occur, crucial data of millions of people would be at risk of landing in the wrong hands.

The  Equifax Data Breach is another example that highlights the vulnerabilities that are present on major systems that boast of security. Consumers were left reeling on September 7, 2017, when one of the largest data breaches in history took place at Equifax, a major consumer credit reporting agency. The details of 143 million Americans – names, social security numbers, addresses, etc. – were attained by hackers, leaving citizens in a state of disarray.

These cases are examples of why digital identities are not working in the current traditional systems. They are not safe enough, and no matter what measures are taken, this will remain the truth as long as they are centralized. But what these current systems are unable to solve, blockchain technology can – and this is why it has become the major topic of conversation on how to make global data more secure. Metaverse, an open-source blockchain company, aims to be the frontrunner in making blockchain-based Digital Identity a feasible reality for the world.

The Breakthrough with Digital Identity using Blockchain

Metaverse Foundation aims to provide Digital Identities (DID) that are linked to a person’s real-life identity, thus guaranteeing that what one sees on the blockchain is actually factual.

This is done through a standard KYC procedure. If a person wants to make use of a service but has not completed KYC, then he or she will go through this procedure first in order to have his or her identity verified and stored on the blockchain. If the person has already been verified by a third party (also known as an Oracle) on the Metaverse blockchain, then he does not need to go through the process again.

For instance, person A fills in the required fields that will need verification. An Oracle uses the master private key to sign the information as valid. Thus, the authorities who need the information (i.e. the people providing the services) can make a request for the factualness of the field’s information, including the Oracle endorsement on-chain. If the authorities are convinced that person A’s information is valid, services can be provided to them. All of this takes place in a matter of minutes, providing efficiency to all parties involved. Presently, this solution would be ideal for banks, as financial services is an area that is in dire need of next-level verification and Digital Identity solutions.

How will Digital Identity (Avatar) and KYC integrate in Real Life?

 Metaverse Foundation has stated that digital identity is unique and can be autonomously controlled by the user. Hence, they do not need to rely on any central entity or third party for identity verification purposes. Metaverse can partner with various bank and institutions, and users can complete the KYC procedures and following standards set within the international standards of anti-money laundering and counter-terrorist financing set by the Financial Action Task Force (FATF).

There are two stages of completion of this procedure. In stage 1, there will be a choice to enable Digital ID and a token will be issued and attached to the Digital ID. This is the concept of validating whether something is true without the need to actually look at the data yourself (Zero Knowledge Proof). The result of the verification can be directly presented to the bank rather than presenting the original data. In stage 2, the user can use his/her private key to authorize banks to access the certificate if there is a need to do so.

Digital identity will allow people to show that the identity that has been verified instead of going through the tedious process of carrying around and showing a physical copy of one’s identification to the respective authority. This Metaverse solution also prevents identity duplication or theft from taking place, a problem that is currently rampant in the current centralized systems around the world.

Identity verification is about to take on a completely different look as a result of this groundbreaking innovation. Paper processes will soon become a thing of the past as a result of the possibility provided by blockchain technology, and this will definitely be for the benefit of the world. Blockchain technology will be able to reach people and industries all over the world. We can see a world where everyone has a Digital ID, regardless of where they live. Companies will have databases that are blockchain-based, with a set of consumers who all have verified Digital IDs on the blockchain – ID’s that cannot be duplicated or stolen. Exciting times truly lie ahead as we witness where blockchain technology can take us.