Digital ID solves the data protection dilemma

A year like no other, with much of life going online, was a compelling argument in favor of digital identity. The talk of “immunity passports”, data protection-protected contact tracing apps and even a possible switch to online voting systems speaks for the need for robust digital identities.

In July 2020, the World Economic Forum published an information paper on the risks and opportunities relating to the “Internet of the Body”. From wearable technology to connected medical implants, it is evident that our future digital identities may contain more data than we ever thought possible.

The urge for digital identity also leads to a strong rebound. The idea that we should give governments and institutions even more control over our data is a cause for concern for many people.

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Technology is the solution, not the problem

The answer to this problem is not to maintain the status quo. If anything, the events of 2020 showed that our current approach to identity is not fit for purpose. As we move more and more online, the cracks in the existing system become more apparent.

In the crypto sector in particular, anonymity was sought as a solution for data protection. But that’s not the answer either. It is just not possible to exist in the real world and remain completely anonymous. A flight, online payment for goods and services, medical treatment or driving a car are just a few examples of everyday activities that are linked to our identity.

Technology is the answer. Cryptographic solutions such as zero knowledge proofs, on the one hand, solve the compromise between anonymity and data protection and, on the other hand, can prove our identity if this is legitimately required.

Real applications

A practical example could be the much discussed idea of ​​“health passports”. Let’s say you want to take a flight in early 2022. The airline just needs to know that you do not pose a risk of infection to fellow passengers. You may also travel to a country that requires immunity to yellow fever. You will receive your vaccines against COVID-19 and yellow fever, and the status will be added to your digital ID, which is encrypted by knowledge-free evidence.

You can now show that you can fly safely without telling where or when you received your vaccines, at which clinic or by which doctor they were given. The airline can simply scan a QR code on your phone, which confirms that you are not going to put anyone at risk.

While COVID-19 creates a compelling immediate use case, it has wide-ranging uses. If you want to buy age-restricted items such as alcohol or tobacco, you can create a QR code to prove your age without having to show a copy of your ID. Also, if you’re looking to rent a car or take out a loan, you can prove your driver’s license or credit rating without distributing copies of personal information.

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Prevent abuse and ensure compliance

To underpin this system, there needs to be a resilient mechanism by which an individual’s identity can be revealed when legally required to do so. This is necessary to ensure compliance with the relevant jurisdictions and to prevent the system from being misused by bad actors.

For example, if someone used a rental car to rob a bank or just got a ticket, the authorities want to know who they are. In this case, the unconscious evidence can be deciphered. However, decentralizing this responsibility across multiple parties ensures that it is not abused or abused and eliminates the single point of failure.

In 2021 we will see the beginnings of a system in which people can walk around with their digital identity in their pockets. It will be the beginning of the end for outdated, document-based systems and the beginning of a new era of self-sovereignty over our data.

The views, thoughts, and opinions expressed here are the sole rights of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Beni Issembert is the Chief Marketing Officer of the private Concordium blockchain for businesses. He is also a published author, a member of the IOUR Foundation, and the former Chief Marketing Officer of Beam Protocol.