Blockchain verifies the identity of 1.5 billion people and transforms government and business governance

Yuan Shouci, director of the National Chengchi University's Center for Public Enterprise, wrote an article pointing out that in the future, blockchain will be used in the field of digital identity to verify the identities of 1.5 billion people who lack legal identities, which will bring about disruptive changes in government and business governance. This article has certain reference value.

Article 6 of the 1948 Universal Declaration of Human Rights states that everyone has the right to recognition before the law. The World Bank estimates that 1.5 billion people today lack legal identity, and 200 million children under the age of five are undocumented; in the Americas, 6.5 million children do not have birth certificates. Undocumented identity means that child labor, human trafficking, or other human rights violations may occur, that is, such undocumented people are often at risk of exclusion and exploitation, and have difficulty accessing basic health and education services.

Normally, citizens of a country need to be registered to represent their identity with rights and benefits, and citizen registration is one of the ways to measure the efficiency of a country. However, due to the lack of an appropriate legal and information framework and national policies constrained by budget, citizen registration is often flawed.

To this end, the United Nations launched the first ID2020 Summit in 2016, with the mission of using innovative technologies to solve the legal identity issues of vulnerable groups, so as to achieve the United Nations' goal of providing legal digital identities to everyone in the world who lacks legal identity by 2020, and providing universal ID for everyone on the planet by 2030. Digital identities based on blockchain are recognized as innovative technologies that can achieve this goal. In turn, digital identities based on blockchain will also have an impact on government and business governance.

We already know that blockchain can lead the Internet to a higher level of value Internet. Various forms of valuable smart assets (such as digital assets, other tangible or intangible valuable assets) determine the ownership of assets through decentralized blockchain. The management of asset ownership is automatically executed by the algorithm of blockchain smart contracts embedded in the assets. The author's previous column has outlined the impact of blockchain on the diversified industries of the innovative economy, the development trend of blockchain smart assets, and the practice of blockchain smart contracts on the value Internet. This time, I will extend the concept and application of "blockchain-based digital identity".

Traditionally, a digital identity is an entity's identity expression on the Internet, including personal identity information and auxiliary information. In general, an entity (real or virtual) can have multiple identities, such as citizenship, student identity, or membership, and each identity can include multiple attributes, such as age, gender, occupation, etc. Figure 1 illustrates the conceptual relationship between identity and entity, and between identity and its attributes.

Digital identity is a thorny issue, fraught with technical, legal, social, and political issues, because it involves two different but interrelated issues: (1) how to prove that you are you (access control); and (2) how to control your personally identifiable information, including fingerprints, pupils, passwords, ID cards, etc. (see Figure 2). For example, before the advent of the Bitcoin blockchain, traditional banks had to approve every normal transaction, and users could not avoid the bank's mediation (i.e., managing the association between individuals, digital identities, and attributes) because banks were seen as intermediaries that could confirm customer identities (Know Your Customer – KYC).

Personal identification information such as fingerprints

The application of blockchain to digital identity has a number of disruptive effects. Due to the decentralized nature of blockchain management of trust and decentralization, personal identity is not controlled by any organization (whether government or business). And under the operation of blockchain, no one can change any record, only new records can be added, so identity is immutable. In the world where blockchain has not yet been used to manage identity, we are used to having our identities granted by the government; but under the use of blockchain, we can control our own identities, so that we can avoid twists and turns (such as using many different passwords) to use various services on the Internet, or trade various intellectual assets. Therefore, blockchain is highly expected to help the United Nations realize the concept of giving everyone in the world who lacks a legal identity a legal digital identity in 2020.

With the application of blockchain technology, individuals have more control over their own identity management, which also changes the way people interact with the government or business. In the past, the government or business organizations collected personal information in a centralized manner to sell goods or services at the right time in a way that maximizes their interests. But through blockchain technology, people can control their own identity and information, and can choose to buy goods or services at the most appropriate time and in the most suitable way.

Blockchain-based digital identities have three uses (Zhang, 2016). The first is identity for authorization, such as authorization for the transfer of ownership of intellectual assets. The second is identity as evidence. All transactions based on blockchain-based digital identities will be recorded in a decentralized public ledger and cannot be deleted, so they can be retained as evidence records. The third is identity for permission, such as voting, which is the most widely used way of identity for permission.

Recently, some companies have created blockchain-based digital identity services. For example, ShoCard uses blockchain to ensure secure storage and build identity data management applications (Figure 3). This identity data includes fingerprints, facial images, iris patterns, and voice recognition. With ShoCard's application service, individuals can manage their own identity data on their mobile phones and are the only ones who have the right to decide which identity data can be shared. ShoCard is working with SITA Travel Information Technology (which has a partnership with 90% of the aviation industry) to think about solutions to airport transit congestion to speed up the passport control process.

Imagine that when a passenger transits through an airport, they can use the ShoCard service on their mobile phone to generate a Single Travel Token that links all travel documents (i.e., a smart asset that has been encrypted with the blockchain public and private keys). Border agents can use the identity information shared by passengers and verify the passenger's passport by scanning the public key of the QR code. In other words, ShoCard and SITA hope to create a decentralized autonomous organization. Even at airports in different countries, the authenticity check of passengers' passports at transit airports will be achieved through decentralized blockchain-based digital identities.

ShoCard's digital identity application service on mobile phones

In the future, blockchain-based digital identities will appear in various fields with more diverse services. (Source: China Times Electronic News)