In today's increasingly digitized world, the importance of digital identity cannot be overstated. As technology becomes more prevalent in our personal lives, businesses, and society at large, the need to prove who we are online and ensure secure and reliable identity verification goes hand in hand. The rise of automation and artificial intelligence only magnifies the significance of protecting our identities and ensuring trust.
Shockingly, as of February 2023, an estimated 850 million people worldwide lacked a form of identification. This means they had no birth certificate, passport, driver's license, or national ID. Recognizing the scale of this issue, the United Nations has set a goal to establish legal identity for everyone, including free birth registrations, by 2030. Legal identification is a fundamental human right, enabling financial inclusion, social protection, healthcare access, gender equality, and child protection. It is the key to accessing essential services and opportunities such as employment, banking, and social assistance.
While having an ID may seem like a given in more developed economies, the growth of digital services amplifies the need to secure our identities as we embrace more convenient ways of transacting online. Unfortunately, we face numerous risks in this digital landscape. Impersonations and spam bots can make fraudulent calls on behalf of CEOs, tricking employees into sending money or making donations. Deep fakes, which are highly realistic manipulated videos or audio recordings, further complicate the trustworthiness of online content. Platforms like LinkedIn, Twitter, and Airbnb are hotspots for fraud, and there is an ongoing challenge to authenticate the authenticity of user-generated content. Additionally, there is a growing concern about automated data scraping, where our identities are collected across the web for the development of machine learning models. Securing and protecting our identities on this ever-expanding digital realm is becoming increasingly challenging.
Riley Hughes, the CEO of Trinsic, a leading infrastructure for issuing and accepting reusable ID credentials, recognizes the growing distrust in our current systems. Hughes has been an early adopter in the self-sovereign identity space, working with communities to evolve not just the technology but also the governance layer. His insights shed light on the future of digital identity in an AI-enabled world.
So, what exactly is digital identity? Hughes defines it as a digital representation of a person, analogous to the physical you. While physical identity is established through tangible items like ID cards or passports issued by trusted entities like governments, digital identity encompasses a set of attributes or data elements that represent an individual in digital platforms. These attributes could include usernames, email addresses, or even biometric data.
The core element of trust in both physical and digital identities lies in the issuing entity. When we present our physical identification, such as a driver's license, the recipient trusts the credential because they trust the authority that issued it, not necessarily because they trust us personally. Digital identities, on the other hand, can be more easily compromised, thus requiring additional security measures such as encryption, two-factor authentication, and regular password updates.
While both physical and digital identities serve the purpose of establishing trust and verifying individual identities, the methods and challenges involved differ significantly. Physical identities often require comprehensive identity proofing only at the issuing point, whereas digital identities require ongoing security measures to maintain a high level of trust.
The evolution of digital identity has seen a shift from traditional physical IDs to more convenient online account creation. Initially, websites required unique usernames and passwords, demanding identity verification from scratch. However, major tech corporations introduced federated login options, such as 'log in with Google' or 'log in with Facebook,' capitalizing on accumulated user data. While these options offered convenience, they also raised concerns about entrusting all our data to big tech companies, leading to increased tracking and less control over our personal information.
To address the challenges and risks associated with digital identity, there is a pressing need for standardized, interoperable solutions. The World Economic Forum emphasizes the significance of establishing trust and safety standards to combat issues like fake accounts and impersonations. One promising solution lies in the concept of verifiable credentials and reusable IDs. These credentials can be tokenized and stored in a digital wallet, allowing individuals to selectively share relevant information without compromising their identities. This approach not only enhances security but also improves user experience, reducing the costs and redundancies associated with repeated identity verifications.
However, the implementation of such solutions requires a paradigm shift. Companies must move away from a reliance on single entities and embrace interoperability and decentralization. Standardization becomes the 'magic' enabling technology to work seamlessly across various platforms and applications. Verifiable credentials
