Blockchain, Self-sovereign Identity and Digital Credentials

A decentralized, secure ledger that is open to many parties is blockchain. It keeps track of all computer network transactions, and once data has been stored, it cannot be altered or removed. Consensus methods and cryptographic techniques—which call for agreement among network users—are used to accomplish this security. The network keeps the ledger up to date and uses consensus to confirm transactions, preserving the accuracy of the data.

In this article, we will discuss What is SSI, Digital credentials, and how they used blockchain technology extensively.

What is Self-sovereign Identity?

Self-sovereign identification (SSI) is a digital identity strategy that gives people the freedom to manage their identity data while having their identity verified online. Individuals have ownership and control over their digital identities in a self-sovereign identification system. They can create, manage, and authenticate their identities independently of centralized institutions or middlemen. So, an individual has the right to decide what personally identifiable information is shared, with whom, and for how long.

SSI concept is properly based on claims, proofs, and attestations: 

1. A claim is a declaration of the user’s identity.
2. Tokens or papers that support the claim are called proofs.
3. When the claim is validated and declared factual, then it is known as attestation or validation. These are normally machine-readable and can be kept on the user’s device.

Benefits of SSI:

• Data is more secure.
• The processing of data is smooth and efficient.
• Users have higher control over their data.

Limitations of SSI:

• It may be necessary to use various identification platforms, which would force consumers to use different applications.
• It might be difficult to keep track of user information and permissions.
  SSI guarantees people enjoy a seamless and consistent web experience while safeguarding their privacy and security without relying on major identity providers.

3 Pillars of Self-Sovereign Identity

SSI operates on three fundamental pillars: Decentralized Identifiers (DIDs), Verifiable Credentials (VCs), and Blockchain. 

1. Decentralized Identifiers (DIDs): A user-specific identification number linked to a single central authority provides control and privacy over personal information and allows individuals to utilize their digital identities in a variety of situations without disclosing unneeded personal information.
2. VCs, or Verifiable Credentials: Digital certificates testify to a user’s identity or other qualities and allow people to only share the information they need to provide, respecting their privacy.
3. Blockchain: Ensure that digital identification information is safe and unchangeable.

Principles of Self-Sovereign Identity

These 10 guidelines can be used as criteria to determine if the current identity solution complies with them. The principles of SSI are:

• Existence: Users have separate lives that do not rely on the information in their digital IDs.
• Control: Users are completely in charge of their identities and can change, update, refer to, and hide them. Users are completely free to choose to reveal or keep their identification information private.
• Accessibility: Individuals must be able to access and retrieve their data as needed.
• Portability: Despite being trusted, identity-related information and resources must be portable and not held by a single third party.
• Interoperability: Because SSI solutions are compatible with other platforms, organizations, and technologies
• Transparency: The SSI identity management network’s algorithm is open source, allowing anybody to inspect and evaluate its operation, maintenance, and changes.
• Longevity: SSI identity should provide permanent, long-lived, and persistent identities.
• Minimalization: Users should only disclose necessary data when requested. e.g.- if you have been asked your national identity, then there is no need to reveal your household address.
• Consent: It is essential for sharing identities across borders, apps, platforms, etc.; collecting user data in a wallet is primarily for this purpose.
• Protection: The privacy of users should be protected at all times.

History of Self-Sovereign Identity

The concept of SSI dates back to early conversations on digital identification, formalization, and development and only took off in the 2010s. Here is a chronology of significant SSI historical events:

1. 2005: Identity Commons and User-Managed Access (UMA) Initiative: Identity Commons, a nonprofit organization, begins exploring the concept of self-sovereign identity. The UMA Initiative is launched to develop standards and protocols for user-controlled access to personal information.
2. 2011: Identity Ecosystem Steering Group: The U.S. National Strategy for Trusted Identities in Cyberspace (NSTIC) is launched. The Identity Ecosystem Steering Group (IDESG) was established to encourage the establishment of an identity ecosystem based on each individual’s autonomy, security, and privacy.
3. 2014: Sovrin Foundation and the Birth of Decentralized Identity: The Sovrin Foundation is established to advance the concept of decentralized identity. Sovrin Network, a global public utility for self-sovereign identity, is launched.
4. 2016: W3C Verifiable Credentials: W3C is developing Verifiable Credentials, a specification for secure, tamper-proof credential, privacy-enhancing credentials. Verifiable Credentials provide a foundational technology for SSI by enabling the issuance, verification, and presentation of digitally signed credentials.
5. 2017: Rebooting the Web of Trust: The Rebooting the Web of Trust (RWoT) community gathers for its first event, bringing together experts and researchers to explore SSI and related technologies collaboratively. RWoT events continue to be held annually, fostering collaboration, research, and standards development in the SSI space.
6. 2018: Hyperledger Indy and Aries: Hyperledger Indy, an open-source blockchain project, is launched to provide tools and libraries for building SSI solutions. Hyperledger Aries, an infrastructure project, is initiated to develop interoperable components for creating SSI agents and wallets.
7. 2020: COVID-19 and Digital Identity: The COVID-19 pandemic highlights the importance of secure, privacy-preserving digital identities for contact tracing, health certificates, and remote interactions. SSI solutions gain increased attention as a means to address these challenges while protecting individual privacy.
8. 2021: Growth and Adoption: SSI gains momentum as more organizations and individuals recognize the benefits of self-sovereign identity. Several SSI-based projects and platforms are developed, providing individuals with greater control over their personal data and digital interactions.

Key Phases in the Evolution of Digital Identity

In the process of developing a digital identity, there are four stages:

1. Password and username: It’s the initial stage of digital identity, usernames, and passwords were used for verification.
2. Centralized Identity Management: During the second phase, methods for managing personal information through centralized identity management began to appear.
3. Federated Identity Management: The third phase featured the development of federation identity management systems, in which several organizations could trust each other to handle identity information.
4. Self-Sovereign identification: The present stage of digital identification is in its fourth phase, which involves the development of decentralized identity management systems in which individuals control and own their data.

Problems with Centralized Digital Identifiers, Credentials, and IDs

The following are the issues: Digital Identifiers, Credentials, and IDs Centralized: 

• Insufficient Privacy: Personal information is captured and stored in a central database through centralized identity management systems, making it vulnerable to hackers and data breaches. 
• Lack of Control: Personal information about individuals can be accessed and disseminated without permission.
• Issues regarding interoperability: Since centralized identity management solutions are frequently confidential, it can be difficult for users to access their identities on many platforms and systems.
• Cost and Upkeep: Centralized systems for managing identities are expensive to operate, and it is up to the company to keep them secure and current.
• Single point trust: Users must trust the central authority with their data, which can lead to misuse or abuse of power.
• Exclusion: Centralized systems may exclude or discriminate against those without access or meeting criteria.
• Lack of resilience: Centralized systems are prone to disruptions, causing widespread service outages.
• Lack of transparency: Users lack visibility into data handling and processing within centralized systems.
• Dependency on a central authority: Reliance on a central authority can lead to delays and administrative burdens.
• Jurisdictional challenges: Centralized systems face complexities in complying with different legal frameworks and data protection laws.
• Loss of anonymity: Centralized systems link real-world identities, reducing online anonymity.

Benefits of Self-Sovereign Identity Management for an Organization

Here are the four points on the benefits of self-sovereign identity management for organizations, summarized:

• Enhanced Data Privacy and Security: Individuals have control over their personal information, reducing the risk of data breaches and unauthorized access.
• Streamlined Identity Verification Processes: Organizations can quickly and securely verify identities, eliminating redundant checks with third-party providers.
• Improved User Experience and Trust: SSI provides a seamless, user-centric experience and fosters trust among users, enhancing the organization’s reputation.
• Cost Reduction and Compliance: SSI reduces infrastructure costs and aligns with privacy regulations, such as GDPR, improving compliance efforts.

Benefits of Self-Sovereign Identity Management for an Individual

Here are the four points on the benefits of self-sovereign identity management for an individual, summarized:

• Control: People have total control over their identifying information, preventing it from being accessed by outside organizations without their permission.
• Privacy: Individuals have ownership over their personal information and may safeguard it against hackers and data breaches.
• Cost-effective: SSI systems are cost-effective to maintain, as the burden of security and maintenance falls on the individual rather than the organization.
• Trust: SSI uses cryptographic techniques to make sure that the identification information it collects is correct, legitimate, and impenetrable.

Benefits of Self-Sovereign Identity Management for a Developer

Here are the four points on the benefits of self-sovereign identity management for developers, summarized:

• Decentralized Architecture: Developers can work with cutting-edge technologies like blockchain or DLT, exploring innovative solutions.
• Interoperability and Standardization: SSI offers standardized protocols, frameworks, and APIs, reducing development complexity and enabling seamless integration with various platforms.
• Enhanced Security and Privacy: Developers can build secure and privacy-preserving applications using cryptographic techniques and privacy-enhancing technologies.
• Empowering User-Centric Applications: SSI enables the creation of user-centric applications, enhancing user experience and trust by giving individuals ownership and control over their identities.

What are Digital Credentials?

Digital documents, messages, or software can be authenticated, and their integrity is confirmed using a secure mathematical approach called a digital signature. It gives proof of origin, identity, and status and addresses the issue of tampering and impersonation in digital interactions.

These credentials can include a variety of information, such as professional accomplishments, digital badges, educational degrees, certificates, licenses, and other types of acknowledgment. They give people a transportable and verifiable means to demonstrate their skills and credentials to potential employers, academic institutions, professional organizations, and other interested parties.

Role of Blockchain in Self-Sovereign Identity and Digital Credentials

Blockchain technology has revolutionized the way we manage self-sovereign identity and digital credentials. The following are some properties of blockchain that serve a purpose in self-sovereign and digital credentials:

1. Blockchain makes Digital credentials, such as certificates and degrees, safer, validated, and kept on a decentralized, tamper-proof ledger. This gives people and organizations a trustworthy and transparent mechanism to access and exchange these credentials, increasing their overall trust and confidence in the validity of digital information. 
2. Blockchain makes trust possible since it gives people complete control over their data. Users with a decentralized and immutable ledger may control and distribute their data on their terms, independent of centralized authority or middlemen. 
3. Blockchain ensures high data privacy and security when it comes to self-sovereign identity and digital credentials, the data is shielded against unauthorized access and modification by blockchain technology’s distributed ledger and cryptographic mechanisms.
4. The blockchain decentralized structure makes it possible to independently validate credentials without depending on a single authority. This increases confidence and trusts in the accuracy of digital information and guards against fraud and deception. 

How do Blockchain, Decentralized Identifiers, and Verifiable Credentials Work Together?

Decentralized Identifiers (DIDs), Verifiable Credentials (VCs), and Blockchain, the three SSI pillars, collaborate to develop a comprehensive and secure framework for managing digital identities.  

• Provides unique user identification: Decentralized Identifiers provide a unique user identification unrelated to any central authority, allowing clients to keep control over their data and utilize it in various circumstances while maintaining privacy. 
• Verifiable credentials can be used in many areas: Verifiable Credentials are digital and cryptographically secured versions of both paper and digital credentials that are used to confirm a user’s identity or other characteristics. These credentials may be used in several areas, including banking, education, and the healthcare business, and are offered by respected organizations. 
• Data is secure: Blockchain guarantees that digital identification data is secure and untouchable, in which a decentralized and reliable system is used for storing and verifying digital identities, and the credentials that go with them are made possible by the use of blockchain technology. This protects the digital identity against fraud or manipulation.

When taken as a whole, these three pillars offer a thorough framework for handling digital identities that is both safe and privacy-protecting.

Self-Sovereign Identity Wallet

An SSI Wallet is a digital tool that stores your verifiable credentials, making it easy for you to show those credentials to others in a secure, private way, using cryptographic methods to ensure data security. SSI wallets provide high trust and integrity because work on blockchain technology, which provides a decentralized and immutable ledger, enabling the secure storage, verification, and sharing of identification information, with the potential to revolutionize identity management in various sectors, including finance, healthcare, education, and government services.

Some dynamic features of SSI wallets are as follows:

• Privacy and Security: SSI wallets allow consumers to store their private information locally on their devices or in a secure decentralized network, lowering the possibility of data breaches and unauthorized access.
• Control: Users have complete control over their identifying information and may choose when and with whom to share it. They can offer restricted access to various data sets, enabling fine-grained permission management.
• Portability: SSI wallets help users take their digital identities with them as they switch between services, platforms, and devices. Because of its portability, various usernames and passwords may be created and managed with less effort.
• Interoperability: SSI wallets are made to work with a variety of platforms, protocols, and standards. 

Self-Sovereign Identity Use Cases

Some Fields where SSI, Digital credentials, and blockchain are used are as follows: 

• Digital identity verification: SSI makes it possible for people to safely keep and communicate their unique features with trustworthy parties, simplifying the identity verification process. This can be helpful in a variety of situations, including creating bank accounts, applying for government services, and getting access to internet platforms.
• Government: giving citizens control over their private data, enabling government services easier to access, and reducing the danger of identity theft.
• Education: giving students access to their academic records, enabling them to exchange their credentials more easily with potential businesses or educational institutions.
• Finance: providing people access to more safe and efficient ways to receive financial services while allowing them to maintain control over their financial information.
• Healthcare: giving people control over their health records and delivering a more secure and effective method of transferring medical information amongst healthcare professionals.
• Legal and Notarization Services: Self-sovereign identification can streamline legal processes by providing individuals with verified digital identities. It can facilitate secure digital signatures, document notarization, and remote contract execution, reducing the need for physical paperwork and enabling more efficient legal transactions.
• Voting Systems: Secure and transparent voting systems can greatly benefit from self-sovereign identity, safeguarding the validity of the voting process and minimizing the danger of fraud.

Online transactions may be made more securely by using self-sovereign identification. Individuals may securely sign and authorize transactions using digital signatures and encryption methods, assuring the reliability and non-repudiation of their online dealings.