Identity thefts? Don’t worry, blockchain got you covered…

It seems that identity theft-oriented crimes have become an area of concern. This is believed can adversely impact the growth of digital economy-based developments. As questions prevail around the safety of digital identity sector, experts believe that blockchain utilisation can help address issues around identity management by ensurance of self-sovereignity through decentralised networks.

Insights from a research report published by Market Research Future (MRFR), a market analysis company, stated that the blockchain-based identity management market is expected to reach $17.81 billion by 2030, at a compound annual growth rate (CAGR) of 56.60%. “Blockchain has the capability to benefit many industries in terms of transparency, security and business-backed value addition. Thus, it is on the verge to transform the current working of identity management in a securable manner. Blockchain-based solutions to carry the potential to remove reliance on various government authorised identifications (IDs) such as voter ID, passport, pan card, among others. The blockchain ecosystem is believed to be cost-effective and time-efficient for purpose of data procurement around digital identities,” Amanjot Malhotra, country head- India, Bitay, a cryptocurrency exchange, told FE Blockchain.

Market behaviour suggests that blockchain solutions around digital identity protection can help provide benefits such as implementation of unique identity (ID) for users, ensures consent of users, creates a decentralised database for identity protection, and helps in creation of a universal ecosystem. In 2013, Ryan Shea and Muneeb Ali founded Blockstack, which helps users protect their digital identities through elimination of digital interemediaries and allow users to have full control over their digital privacy. 

“Blockchain-computerised identity activities could make use of mechanical progressions. Blockchain can assist in developing new identity frameworks with advanced identity systems highlighting decentralised identifiers. Instances of blockchain identity management executions include Blockpass for Know Your Customer (KYC), Remme as a non-custodial login provider, among others,” Vikram R Singh, founder and CEO, Antier, a blockchain company, stated. The idea of blockchain identity management can be implemented across various ventures such as banking and finance (BFSI), logistics and transportation, real estate, creative arts, and government projects such as e-governance.  

Moreover,industry data suggests that blockchain’s utilisation of smart contracts prevent data manipulation, which ensures that linked identity management systems remain secure for identity holders. “Smart contracts can help in ensuring that only authorised parties can get access to identity proofs. Since blockchain doesn’t have any geographical confinement, identity management becomes universal,” Ramkumar Subramaniam, co-founder and CEO, GuardianLink, a blockchain-based research and development organisation, mentioned. 

Reportedly, blockchain networks such as Ethereum, Polygon, and Solana all have implemented identity management protocols. The Smart Nation initiative of Singapore introduced the application of digital identity which refers to the National Digital Identity (NDI) system to help citizens avail the facilities of an e-governance system. Founded in 2016, Civic, a blockchain-based identity management platform, functions within a given framework and focus mainly on identity management and security.

Also read: What is Tokenomics and how does it work

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