How Blockchain Can Bring More Transparency in Digital Identity Management

Everything that we do online requires us to create an identity on that platform. It can be something as simple as creating a profile on a social media site or a little bit complex like a bank transaction. Our identity is what allows us to avail of these online services. Hence, it is not wrong to say that an individual’s identity is a valuable asset in every sense.

However, unlike traditional assets, security and privacy are a rising concern when it comes to one’s digital identity. Thankfully, we finally have the technology by which we can keep our digital identity safe and also control the accessibility of it by any third party.

In this article, we will discuss how blockchain technology can be instrumental in bringing more transparency in the present digital identity management system and make it more secured.

Before we get any further into the topic at hand, let’s do a quick review of the basics of digital identity.

  • An identity mostly comprises of the basic information about oneself such as name, address, and date of birth. In certain cases (mostly related to transactions) one might need to provide their driving license, passport number, social security number, etc.
  • Identity is very important. It is what allows us to avail of public services, conduct transactions, give a vote, get an education and apply for a job, etc. It’s what makes us the part of society.

The problem with digital identity is that it is stored and handled by centralized bodies. This can and does lead to in many occasions mishandling and control of data and also the theft of identities by hackers. In recent years, major data breaches like that of Facebook, Yahoo, and Equifax, etc. have shown us the vulnerability of the existing system.

With the present system of identity management, our data is not bulletproof. It can be stolen, replicated or mishandled by third parties. We might be the owner of our identities but we have no control over it. Blockchain technology can stop that and bring more transparency in the way identities are being used for various services.

Blockchain comes with three unique features that make it the best technology for digital identity management:

  1. Firstly it is decentralized, meaning that the data in the block is not controlled by any centralized body. The data is kept in the nodes of the blockchain network,
  2. Secondly, it is immutable, meaning that the data in the blockchain is protected by cryptographic hashing making it tamper-proof.
  3. Thirdly, blockchain promotes transparency in a system. All the participants or nodes in a blockchain network can see the data that has been entered.

Self-Sovereign Identity or SSI

Blockchain empowers the users with self-sovereign identity or SSI giving us control over our digital identities. Meaning that we are in full control of the data that is being shared. Blockchain helps us create SSI that makes us the true and absolute owner of our own identities. It means that no one can get access to our data without our permission. We can even control how much data we want to share with anyone.

Blockchain comes flexibility for the user to have a single identity across several platforms or different identities to fulfill specific needs. It empowers the user with a private key with which they can control the accessibility of the data and also keep it secured.

Use of blockchain in digital identity management can thus solve the following issues:

  • It will make replication or duplication of digital data impossible
  • It will also prevent tampering of digital data and digital processes

The top names in the blockchain sector providing digital identity management and verification services are:

  • IBM

IBM has introduced its Alpha version of IBM Verify Credentials and one can try it for free. The blockchain-enabled application has a decentralized approach towards identity management.

  • HashCash Consultants

HashCash provides with a blockchain-based digital identity verification platform. The application is available in both android, iOS and web versions.


The company provides an identity and access management system that allows private and public organizations to issue and verification of digital credentials. They present the users with a digital identity wallet.

  • Trusti

Based in Israel, Trusti is a blockchain-enabled platform that provides digital identification for cross-chain transactions.

There are other blockchain development companies as well that are doing promising work in the digital identity management and verification area. Experts are of the view that with the implementation of blockchain in identity management, one can put an end to frauds, identity thefts, and data breaches.



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Maria Garcia

Passionate about blogging on Cryptocurrency, Blockchain applications, Artificial Intelligence & IoT.