How to solve digital identity and bring privacy to a whole new level?

In this post we will debate on the subjects of how to solve some of the biggest challenges of the Internet with digital identity, what is it and how can governments and people leverage from it substantially. Also, what is blockchain and how could it solve the biggest challenge of digital identity — the trust?

The problem of privacy

The most common way to create digital identities is through government agencies — the same agencies that before issued your passport, will now enter your information to the government databases. This is called a centralized system — all the information is located in one place and its access is controlled by a single authority called Certificate Authority.

With a centralized system, human trust is added to the world of data security. Because privacy is nothing more than confidentiality, availability, and integrity of your data then it has the exact same problems like in protecting any other information. Thus to give all your information to a central holder is bound to end up being misused in some given time.

“Put another way when building security systems if you have an assumption that includes trust (in keys, in human administrators) then with sufficient time you will be compromised with probability 1.” Mike Gault, Co-founder and CEO Guardtime

But this is exactly what is happening in today’s digitalized world. Information is available to the government and it acts as the Certificate Authority over your data. Indeed, in most cases, your information is protected and there are multiple laws in place to back it but as mentioned above every trust anchor is bound to fail at some given time. This is why we have seen huge privacy violations by the governments as well as unintentional leaks in the form of hacks from the public as well as private sector. Not to mention the recent US state election hack.

Although these incidents are talked about in media for some time, not much is changed, like any news, it is quickly forgotten and life goes on. Thankfully there are governments and companies that are working on innovating solutions to give their best shot at protecting the privacy of their people. One of these government approaches to the privacy problem is Estonia and it’s decentralized information infrastructure backbone called the X-Road.

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