Blockchain beyond fintech - Part II

This post would be the continuation from my previous post - https://steemit.com/blockchain/@nh53019/blockchain-beyond-fintech-part-i

We will discuss more on identity management in this post.

I would categorise this into two main categories.

• People with no identity
• People with exposed identity

Let’s talk about the first one, people with no identity. Yes, as per UN statistics, there are close to 1.5 billion of people without any identity. These are the people who are fleeing war zones, refugees or victims of human trafficking. They can’t prove who they are since there is no way to do that. Hence, they lack healthcare services, bank accounts and let’s put it this way, normal life. Accenture is teaming up with Microsoft and other NGOs to help them with an identity. They will be using blockchain technology and they named this project as ID2020. By enabling their identity to be validated by blockchain, they are transforming life of these people and setting up an example for others who already have an identity but are exposed. This brings me to my second point.

People with exposed identity, people like you and me who have given our PII data to be stored by someone else in a centralised manner. The Facebook, Twitter, Equifax and many more.. our identity is stored at multiple places and creating a honeypot for hackers who have successfully hacked several times and it’s not going to be the last time unless we do something about it.

We have given these firms an additional way of making money, call it a passive income by monetising our data by selling it to others. Example, how do you think hedge funds get their customers or solicit high net worth individuals to be their customers? Since hedge fund has high minimum requirement for investment, they can’t go and solicit everyone on the street. Usuall, they reach out to fancy car companies, Mercedes, Ferrari’s, the Lamborghini’s etc.. the customers who bought these cars become more suitable targets for these hedge funds. The customer data could easily be sold by these car companies to hedge funds generating extra revenue to the company and creating prospective investor for hedge funds. See? Crazy isn’t it.. this is just one example.. your data is never safe when it’s not with you. Imagine, someone else forging your identity and getting a credit card in your name?

Blockchain can address this issue and it does it in style. Self sovereign identity management is the solution. Let your data be with you and when you would like to avail services, selectively you can release data and there are ways it can be done.

There are several projects in the blockchain space which are already testing their solution. Example, securekey, uPort, Sovrin etc.

The idea is to get your identity, be it your DOB, passport details, drivers license details or Any specific ID issued by the government verified by the corresponding party and secure the proof on the blockchain. This will be stored as a cryptographic hash. You can’t decrypt or reverse this to raw details. Hashing is a one way train. You can secure proofs from multiple providers and when you would like to avail any new service, you can release the identity info by cryptographically hashing it , encrypting it and digitally signing it. Hell yes, as secured as it can get!!

Now, when the service provider receives this, he will decrypt the same to verify that it indeed has originated from you, also using his private key he can decrypt the encrypted hash and then compare this hash value with the one stored on the blockchain. If the hashes match, your identity details are not tampered with and you’re indeed the one who you are claiming to be and you will be granted the service.

Imagine combining this with biometrics like finger prints or retina scan, you can prove that the information shared is you and it’s about you. We are creating a strong system here with the help of blockchain. We are not storing PII but only the proof of the claim is stored and that too it is distributed across nodes and stored decentralised. Also, if there are changes to any of the identity information, like address or phone number etc, you need to get it reverified and the information will be appended to the blockchain. Immutability will strengthen your identity management.

We can do it differently as well where the PII data can be encrypted and with the help of IPFS (inter planetary file system) , chunks of these encrypted data can be stored decentralised manner and when needed can be released to the service provider.

To conclude this long post, identity management is going to be the next big use case which will be appreciated by the human community and the blockchain technology will be hailed as the saviour and more mass adoption will happen based on the transparency and security that this technology is known for.

Please feel free to comment and ask me questions if you’re not clear or have any doubts. I would be more than happy to explain how it is done technically under the hood if you’re interested.

Till then, happy blockchaining...