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Digital identity must be self-sovereign and decentralized

December 24, 2025Updated:December 25, 2025No Comments6 Mins Read
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Digital identity must be self-sovereign and decentralized
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Disclosure: The views and opinions expressed right here belong solely to the creator and don’t signify the views and opinions of crypto.information’ editorial.

It’s exhausting to outline the exact level at which humanity crossed the Rubicon to develop into digital residents. (Was it broadband? Smartphones? AI?) All we all know for sure is that we’re, to all intents and functions, extra digital than we’re bodily. Our our bodies are nonetheless flesh and blood, however our minds — the place we create artwork, music, and verse — now reside within the cloud.

Abstract

  • Digital identification is now synonymous with personhood: Entry to work, studying, and society relies on digital IDs, making management over identification a core human problem, not only a technical one.
  • Centralized identification programs are inherently harmful: They focus delicate information into single factors of failure, enabling surveillance, exclusion, censorship, and catastrophic breaches.
  • Self-sovereign identification is the inevitable repair: Decentralized, cryptographic ID lets people management entry to their information, confirm info with out disclosure, and removes the necessity for establishments to hoard private data.

Because of this, once we speak about digital identification, what we’re successfully speaking about is ourselves. Within the twenty first century, you’re, to all intents and functions, the product of the digital breadcrumbs you permit scattered throughout the net.

Give a person or girl a digital identification, and also you give them the means to work, study, and earn. Take that corridor cross away, and also you successfully banish them from civilized society. We want solely look to China, the place getting caught using with out a bike helmet causes your social credit score rating to drop, impacting your capability to work and journey.

That’s to not recommend that digital identification is inherently dystopian: like all applied sciences, it’s benign. It’s people who decide whether or not it’s used as a power for good or unhealthy, to supply entry or to limit it, which is why it’s essential that digital ID serves its proprietor and never the opposite manner round. Sadly, resulting from elementary flaws of their structure, centralized identification programs are incapable of doing this, which is why they’re destined to get replaced by higher tech.

The issue with centralization

Centralized ID programs focus delicate information, together with biometrics, credentials, monetary data, and behavioral historical past. The extra we do on-line, and the extra our lives — from healthcare to schooling — are digitized, the bigger this trove of information turns into. As the load of all this data grows, so do the incentives for third events to illicitly entry it.

Because the disparate digital companies we use develop into interconnected, we are going to attain a stage the place one digital identification can do every part from signing into social media to reserving a physician’s appointment. This transformation will make our lives extra handy. However it is going to additionally make them extra precarious. As a result of when all information flows via a single hub, attackers want solely compromise one system to entry every part. 

All it takes is a classy hacker or a malevolent authorities for this data to finish up within the improper fingers. The end result might be deplatforming. It might imply exclusion from core companies resulting from “wrongthink.” Or it might imply your bank card particulars are being auctioned to the best bidder on the darknet. However it doesn’t need to be this fashion.

We have now the expertise at our disposal to construct a future wherein our information doesn’t need to be piled excessive in central silos — as a result of it by no means left our possession within the first place. This requires shunning centralization in favor of self-sovereign options.

Self-sovereignty as a service

Self-Sovereign Id, or SSI, reverses the ability dynamic by giving management again to the person. It’s your identification, and also you personal it. However crucially, this doesn’t entail any further friction out of your perspective: you don’t need to grasp complicated expertise or assume duty for storing your information on a house pc; it’s all encrypted and saved on a distributed ledger with an entry key that solely you should use.

Belief is maintained cryptographically, with the person answerable for their very own entry and permissions, whereas the compromise of 1 credential issuer doesn’t compromise the identities of each person. This setup doesn’t simply profit customers, both: it additionally implies that governments, universities, and establishments can problem credentials however don’t need to retailer them. 

SSI works as a result of it combines distributed storage inherent to blockchain, which suggests no extra centralized databases filled with delicate data, mixed with cryptographic expertise that permits the underlying information to be considered solely by approved entities. Privateness implementations equivalent to Garbled Circuits, as utilized by COTI, and zero-knowledge proofs enable the validity of the knowledge to be verified with out revealing its contents. You don’t have to broadcast your date of start or passport scan over the web, in different phrases, to show that you simply’re sufficiently old to order alcohol.

Decentralized ID allows belief whereas eliminating single factors of failure.

Why not now?

If SSI is so good, it’s possible you’ll be questioning why it isn’t carried out all over the place. What’s preserving credential issuers from taking the SSI capsule? The first cause for that is that this requires radical change to the way in which companies take into consideration information and person entry. And alter is difficult: it’s why the web remains to be caught with password verification, regardless of its inherent weaknesses having been broadly identified for years.

The expertise is prepared, then, however the consciousness of its capabilities — and a willingness to implement them — remains to be not widespread. It will occur, however it is going to take time; it took greater than a decade, in spite of everything, for blockchain expertise to develop into broadly understood and trusted. Provided that SSI is a further layer constructed upon this, it is going to require acclimatization from customers and credential issuers alike.

However make no mistake, decentralized identification is the inevitable way forward for digital ID. With each new database hack and data-harvesting scandal, the case for implementing it solely grows stronger. Customers require absolutely the assurance of confidential verification within the data that corporations requesting private information are verifying solely what is important, versus gathering huge, retainable profiles. Companies, in the meantime, have to be relieved of the burden of storing all this information whereas adhering to requirements equivalent to GDPR.

Not every part on the web must be decentralized. However the way in which we connect with the platforms and companies we depend on each day have to be and might be. It’s the one option to create a safe internet that works for everybody. 

Shahaf Bar-Geffen

Shahaf Bar-Geffen is a seasoned entrepreneur and investor. He’s the co-founder and CEO of COTI, a privacy-centric L2, founding father of WEB3, a web-based advertising and marketing group, and Optimistic Cellular (each of which had been acquired). Shahaf can also be the Chairman of Lineup, a web3 Video games studio. He studied Laptop Science, Biotechnology, and Economics at Tel-Aviv College.

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