As the internet became ubiquitous globally over the past three decades, digital identity became essential. In recent years, advancements like AI, bots, machine learning, and the Internet of Things (IoT) have made ownership and control of your digital identity even more critical.
Digital identity involves a delicate balance between allowing the users to prove information such as their name, age, residence and credentials without exposing these details to the wrong parties. This natural evolution has birthed universal wallets, which hold all these details on one platform while allowing users to prove specific aspects. For instance, in California, holders of the state’s mobile driver’s license (mDL) can prove their age when buying age-restricted products while protecting all the other aspects of their identity.
Initiatives like California’s mDL set the stage for universal wallets that users can rely on to access all kinds of services and products.
Digital identity and tokenization: Foundations of a new economic model
While digital identity has been revolutionary on its own, integrating it with tokenization is launching a new economic model that puts individuals at its heart.
According to the World Economic Forum (WEF), integrating the two anchors a new paradigm of value exchange. Tokenization can only take over if individuals are empowered to own their digital identity and interact in digital spaces securely and with trust and authenticity—tokenized currency, in turn, powers instant economic transactions on digital platforms.
Tokenization extends beyond currency and identity and encompasses every economic facet, from securities and capital markets to real estate and intellectual property to time and energy.
“This reflects a shift towards a future where users can hold tokenized versions of their identity, money and objects in their universal wallet,” WEF says.
One of the fields under the most disruption from this new approach is online advertising. Today, businesses rely on stale data collected over time by tech giants such as Google (NASDAQ: GOOGL) and Facebook (NASDAQ: META). They then use this data to target potential clients. However, since most of it is outdated, the average conversion rate globally is less than 5%.
This approach is gradually getting phased out by a personalized strategy that prioritizes the individual’s needs and works to gain their trust. This dynamic allows potential clients to share discrete real-time data with their favorite businesses, who tailor their products to suit their evolving needs. For instance, users can share their real-time purchases with a department store for a more personalized and targeted experience.
This approach is only viable when the user fully controls their online identity and when the platforms at play guarantee security and privacy. This makes blockchain technology the only choice. With a secure, stable, and infinitely scalable blockchain like BSV, users can be assured that they own all their data and can share it securely and privately with third parties.
WEF concurs, stating, “This means the winning businesses of the future will be the ones that earn the trust of their customers. They must excel at earning digital trust through cybersecurity, safety, transparency, interoperability, auditability, redressability, fairness and privacy.”
In the digital identity space, London-based enterprise blockchain firm nChain leads the way with nChain Identity. The firm’s verifiable digital credential solution streamlines the secure issuance, management, and verification of credentials. This solution assigns a user a unique identifier, known as a Decentralized Identifier (DID) while leveraging its Verifiable Credentials to encapsulate the user’s identity-related data.
nChain’s solution relies on BSV blockchain, whose immutability guarantees resilience against tampering.
Identity solutions, like nChain’s, provide “the catalyst for a profound transformation of business models,” says WEF.
“In this new technological era, the future of the internet is set to redefine our world, merging the physical with the digital in a continuum that offers boundless new opportunities.”
Watch: Building more trustworthy internet of the future with Metanet
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Source: https://coingeek.com/digital-identity-wallets-present-new-models-built-on-trust/