Decentralized Identity 101

Is the age of the traditional sign-in with Google or Facebook coming to an end?

Decentralized identity is becoming more essential as we move away from centralized platforms. It allows users to control their data and identities, making them more secure and helping them to stay anonymous.

These technologies allow users to maintain control over their data rather than handing it to third parties like Google and Facebook. This makes them more secure and resistant to hacks. Decentralized systems offer many advantages over centralized systems.

They are more secure because they are not reliant on a single authority; they are more efficient because they allow users to manage their identities themselves.

Finally, they are more democratic because they allow anyone to join or create a decentralized network.

This article will explore why decentralized identity is important and discuss how it can be used.

What is decentralized identity?

Decentralized identity means that users maintain control over their identities and data, essential for privacy and security. Instead of relying on centralized entities like Google or Facebook, users can interact with the internet and other applications via decentralized applications (DApps).

In the digital age, our identities are increasingly important. They are used to access everything from our bank accounts to our social media profiles. However, our identities are also vulnerable to theft and fraud. This is particularly true in a decentralized world where no one authority manages identity information.

The Superpowers of #Blockchain Identity | Balázs Némethi | TEDxINSEAD

Decentralized identity offers a solution to this vulnerability. It allows individuals to control their identity information without relying on a third party. This makes it more secure, as there is no central point of attack. It also improves privacy, as users can choose who they share their information with.

Decentralized identity has the potential to revolutionize how we manage our identities online. It provides a more secure and private way for individuals to interact with the digital world.

What is self-sovereign identity?

Self-sovereign identity (SSI) is a new model for managing digital identities that seek to address these vulnerabilities. Individuals control their identities and personal data with SSI rather than centralized authorities.

This makes SSI more secure, as there is no single point of failure that hackers could exploit. It also enables users to exercise greater control over their data, sharing it only with those they trust.

Self-sovereign identity is an identity that any third party does not control. It is an identity that you create and manage yourself. This may seem small, but it has big implications for security and privacy.

Christopher Allen - Ideology & Architecture of Self-Sovereign Identity | Odyssey Connect 2020

One of the most significant advantages of self-sovereign identity is decentralized. This means that your identity is not stored in one place but rather across many different servers. It also means that you can access your identity anywhere without relying on a third party.

Another advantage of self-sovereign identity is that it gives you control over your data.

SSI is built on blockchain technology, which provides a tamper-proof record of transactions that anyone can access.

How does it work?

We rely on centralized authorities to verify our identities in our current world. For example, we need to show proof of identification to open a bank account, vote, or travel.

Centralized authorities are in charge of verifying our identities and maintaining their records. This system is susceptible to censorship, data breaches, and human error.

Decentralized identity is an open, secure, and efficient system for managing digital identities. It relies on a distributed ledger, such as a blockchain to store identity information. This allows users to control their data and share it with others.

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The decentralized identity process begins with the user registering for an identity. The registration process involves verifying the user's identity and adding their information to the blockchain. Once registered, users can use their identity to sign in to applications and services.

The decentralized identity system provides several advantages over traditional identity systems.


First, it is more secure since the user's information is stored in a tamper-proof distributed ledger.

Second, it is more efficient because there is no need for third-party verification.

Decentralized identities offer a solution to these problems. With decentralized identities, identity verification is distributed across many different entities instead of centralized with one authority.

This system is more secure because there is no single point of failure. It is also more private because there is no central database that can be hacked or accessed by the government.

With centralized identity systems, your data is stored by a single company. That company can be hacked, or it can sell your data to third-party companies. This puts your personal information at risk. With decentralized identity, your data is spread out among many different computers. This makes it more difficult for hackers to access and steal your information.

Decentralized identity also protects your privacy. When you use a centralized identity system, all of your data is collected in one place.

Establishing trust

When you think about it, your identity is one of the most important things. It makes you unique and allows you to establish trust with other people. But what happens if that identity is compromised? Or worse, stolen?

That’s where decentralized identity comes in. With decentralized identity, your identity is stored securely on a blockchain, which means it can’t be stolen or compromised. Not only that, but a decentralized identity also allows you to control who has access to your information. So if you ever want to share your contact information with someone, you can do so safely and securely.

But perhaps the best thing about decentralized identity is that it helps establish trust between strangers.

Reducing fraud

It is no secret that centralized identity verification processes are vulnerable to fraud. For example, a study by the Ponemon Institute found that the average organizational cost of a data breach was $3.8 million in 2016. This is mainly because centralized systems are a single point of failure, and when they are compromised, entire user databases can be stolen.

Decentralized identity verification (DID) systems are changing all of that. DID is an authentication method that uses a distributed ledger instead of a central authority to verify user identities.

Why The Web Needs Decentralized Identifiers (DIDs) — Even if Google, Apple, and Mozilla Object

This makes it much more difficult for hackers to access user data, as there is no one point of entry into the system. As a result, DID-based systems are much more secure than traditional centralized systems.

In addition to being more secure, DID-based systems also offer greater privacy for users.

Personal privacy

There are many concerns about identity theft and the security of personal data. A centralized system stores all of your data by a third party, such as your bank or social media platform. This makes your data vulnerable to attacks and theft.

A decentralized identity system removes the need for a third party to store your data. Instead, your data is stored on a secure blockchain network, making it much more difficult for hackers to gain access. Decentralized identity also helps protect your privacy.

When you use a centralized system, your data is often shared with third-party companies that may use it for marketing purposes. With a decentralized identity system, you can control who has access to your data and what they can do with it. This helps protect your privacy and keeps you in control of your information.

Projects offering Decentralized Identity

There is a new wave of projects that are offering decentralized identity. This is great news for online security, as it eliminates the need for centralized authorities like the standard social media platforms to manage user identities.

One such project is called Okta. It is a decentralized identity platform that allows users to control their data. Okta is built on the blockchain and uses smart contracts to verify identities. This makes it a secure and trustless system that can be used for various purposes, such as logging in to websites, verifying transactions, and signing contracts.

The Keys to Decentralized Identity by Okta

Another project that is worth mentioning is Civic. The Civic platform is based on the blockchain, a distributed ledger that is tamper-proof and secure from fraud. This will provide increased security and reduce the risk of fraud. Civic will also make it easier for users to access services and products online.

CryptoSummit 2018 | Vinny Lingham (Civic): Identity on the Blockchain

Civic, a decentralized identity platform, will enable users to confirm their identities using biometric data, such as fingerprints or facial recognition. 

5 Key Benefits of Decentralized Identity - Civic ...

This will allow businesses and other organizations to verify the identities of their customers or employees securely and efficiently. Civic has already partnered with several companies, including identity verification provider Onfido and digital asset exchange ShapeShift.

Uport is a mobile app that allows users to register and manage their identities on the Ethereum blockchain. It also allows users to sign transactions and documents without relying on third-party services.

As more and more people use the internet to conduct transactions, it is becoming increasingly important to have a secure way of identifying oneself.

Sovrin is a decentralized identity system that allows people to control their digital identities. Sovrin is based on blockchain technology and will enable people to share their personal information with organizations they trust. In addition, Sovrin is a global network that allows people to access their identities from anywhere.

Identity.com is a decentralized identity project that allows users to create, own, and manage their digital identities. The project is built on the blockchain and utilizes decentralized technologies such as peer-to-peer networking and distributed storage. This allows users to control their data and how it is used. Identity.com also uses zero-knowledge proofs to protect user privacy.


These projects are all working on different aspects of a decentralized identity solution. Still, they all share the goal of providing a more secure and user-friendly way of identifying oneself online.

The Pros of Decentralized Identity

We use our identities to access online accounts, sign up for services, and make purchases every day. We trust centralized identity providers like Facebook and Google to keep our personal information safe and secure. But what happens when these providers are hacked or compromised? Again, our data is at risk.

Identity theft is a serious problem that affects millions of people each year. Victims often have to spend months or even years trying to clear their names and repair the damage that has been done. Decentralized identity systems offer a possible solution to this problem.

There are many benefits to decentralized identity. One of the most important is that it empowers individuals. With a decentralized identity system, people can own and control their data. This means they can choose who they share it with, and they can be sure that their data will not be shared without their permission.

Here are some of the key pros of decentralized identity:

1. People have more control over their data.
2. Decentralized identity is more secure, as there is no single point of failure.
3. It can be easier to verify identities when they are decentralized.
4. There is less risk of data breaches or identity theft.
5. It can help prevent censorship and surveillance.
6. Decentralized identities can be owned by individuals or groups rather than corporations or governments.

Decentralized identity offers a more secure and privacy-friendly alternative to centralized identity providers. It also enables more seamless and efficient online interactions. For example, with decentralized identification systems, you could sign into websites and services with just a username and password without creating separate accounts for each one.

The challenges of Centralized Identity

Identity management is challenging for any organization, but it can be especially difficult for centralized identity systems. This is because all user identities and authentication information are stored in a single location in a centralized system. This can make it difficult to manage user accounts and passwords and create security risks.

One of the biggest challenges with centralized identity systems is managing password complexity. All users must comply with the exact password requirements in a centralized system. This cannot be easy to operate, especially if users have different passwords for different applications. It can also be challenging to track which users have which passwords.

Another challenge with centralized identity systems is managing user access. All users must be granted access to the same resources in a centralized system. This can be difficult to manage, especially if users need different levels of access to different resources.

Final Thought

One of the most exciting and important aspects of blockchain technology is its ability to provide a decentralized identity. This means that your data is not stored in a central location but is spread across many different computers.

As a result, it is much more secure and cannot be easily accessed or changed without your permission.

Many potential applications for decentralized identity include online banking, voting, and healthcare. In addition, it could be used to protect your personal information from hackers and identity thieves.

Decentralized identity is also very beneficial for businesses, as it allows them to safely store customer data without having to worry about security breaches.

While there are still some challenges that need to be addressed, such as scalability and user experience, decentralized identity has the potential to revolutionize the way we interact with the digital world.