# DID

# What Is Decentralized Identity?

Decentralized identity, often used interchangeably with self-sovereign identity (SSI), primarily gives individuals the power to control their own digital identity without having to rely on a service provider.

In a decentralized framework, individuals are provided with credentials from important issuers, such as the government, educational institutions, and employers, which are then stored in a digital wallet. Individuals can then present those credentials to the relevant issuing authority, who verifies their identity through a blockchain-based ledger that does not store any of the user’s data.

Essentially, a digital identity is a body of information about an individual, organization, or electronic device that exists online and contains their usernames and passwords, search history, social security number, address, biometrics, citizenship, employment, credit card accounts, credit history, and more.

By using a decentralized identity, individuals gain full control of their personal information, and the ability to provide only the information required for verification. Decentralized identity management supports an identity trust framework through which users, organizations, and things interact with each other transparently and securely.

# How Is Decentralized Identity Managed in Blockchain?

Decentralized identity is set up on the blockchain according to a few key elements. For example, for decentralized identity management, a decentralized, encrypted, blockchain-based wallet is used.

These decentralized encrypted wallets are unique applications (also known as identity wallets) that enable users to create their own decentralized identity. Upon the development of an identity, two cryptographic keys are generated—one public, one private.

The identity wallet submits a registration payload with a public key to the blockchain, which subsequently generates a unique identifier linked to the wallet. The private key, however, remains on the user’s device/identity wallet, and is used during authentication processes.

All information created in the identity wallet is signed and verified by multiple trusted parties to ensure factual accuracy. This means that issuers and verifiers, such as governments, universities, and finance institutes, confirm the information in question, and add the data to the digital identity in a process similar to issuing a certificate. With the newly created decentralized identity wallet, users are enabled to provide proof of identity to any third party, anywhere in the world.

# The Benefits of Decentralized Identity

1. Security: One of the major reasons for leveraging the blockchain in decentralized identity systems is to ensure sturdy security. The blockchain caters to digital signatures, consensus algorithms, and cryptographic hash functions to protect user identities from breaches and theft. In this way, device and data tracking from browsing websites can be fully prevented, safeguarding users against the spread of data without their knowledge.

2. Trustworthiness: Blockchain technology utilizes a consensus approach to prove data authenticity through various nodes, and acts as a source of trust for verifying user identities. Along with this data, each block also contains a hash that changes if anything is tampered with. These blocks represent a highly-encrypted list of transactions and entries shared across all the nodes distributed throughout the network.

3. User Centric Apps: Decentralized identity give developers the opportunity to build user-centric apps that eliminate the need for passwords and inefficient authentication processes, and thereby enhance the user experience. Users can then safely request data directly from other users while maintaining their own privacy.

4. Privacy: Decentralized identity systems leveraging blockchains via pseudo-anonymous identifiers (decentralized identifier) can help mitigate privacy concerns. Each user fully owns their data, and can choose with whom to share relevant information, and how much.

5. Data Integrity: The blockchain-based data storage mechanism is immutable and permanent, eliminating the possibility of modification or removal. Decentralized identity can use this mechanism to ensure that data contained within cannot be modified or tampered with by external entities.

6. Simplicity: Identity issuers can leverage the seamless process of issuing digital identities. Identity verifiers can efficiently onboard new users and conduct the information verification process. Identity owners can effortlessly store and manage their identities within a decentralized identity wallet. This approach conceals data, highly reducing the risk of credential tracking, hacks, and unauthorized access breaches that would otherwise lead to the theft or monetization of people’s data.

Source: https://dailycoin.com/decentralized-identity-what-does-it-mean-and-how-is-it-managed-in-blockchain/

More information on W3C website: https://www.w3.org/TR/did-core/