The World Economic Forum (WEF) has initiated conversations regarding the establishment of a worldwide system for digital identification utilizing blockchain technology. The talks were conducted by WEF’s Digital Identity Initiative during the annual workshop, with a focus on utilizing distributed ledgers to enhance livelihoods through digital ID.
Details of the WEF Discussion
Brett McDowell, the President of Hedera participated in the conversation, emphasizing the superior privacy offered by blockchain in comparison to other systems. With blockchain, users can store the metadata of their digital identities on public ledgers, eliminating the need for an identity provider while also guaranteeing that personal information stays secure in their digital wallets.
Moreover, authorized entities can sign such information with a cryptographic signature to validate its authenticity. According to McDowell, this innovative system empowers users to effectively manage the sharing of their personal information. By determining when and with whom it is shared, individuals can maintain control over their data.
Additionally, this technology enables the sharing of verified personally identifying information, ensuring compliance with important regulations such as know-your-customer, anti-money-laundering, and anti-terrorist-funding laws.
McDowell strongly believes that the widespread adoption of blockchain-based digital IDs will bring about numerous benefits, including fraud prevention and increased financial inclusivity. It is shocking to note that currently, around 850 million individuals worldwide have no access to any official documentation, while many others suffer from privacy concerns that can be addressed through digital ID.
Industry Stakeholders Intrigued by the Potential of Digital IDs
In the realm of Web3 innovation, digital identification methods have been a subject of experimentation. However, these efforts have been inconsistent and lacking a comprehensive approach. Twala, a company based in the Philippines, has taken the lead by releasing its own self-sovereign ID (SSI) solution.
This move offers users greater control over their private data, thus reducing incidents of identity theft. With the alarming number of investors falling prey to identity fraud, Twala’s solution has been well-received by DLT (Distributed ledger technology) enthusiasts. This is due to its ability to eliminate intermediaries when managing user data, making it a highly effective and reliable solution.