How Does Blockchain Influence Data Protection and Digital Identity Management?
Identity theft, especially the synthetic kind, is on the rise. Individual data is being sold or stolen for personal gain. Worse, individuals have no control over their data, how it’s collected, used, stored, or shared. Centralized servers further aggravate the problem and facilitate data breaches. This is why decentralized identity management is the need of the hour and blockchain is more than capable of the job. Let’s dive deeper to understand how blockchain influences data protection and data identity management.
Ways Blockchain Influences Data Protection and Digital Identity Management
Blockchain and decentralization are often used synonymously. Here are a few ways blockchain supports decentralized digital identity and protects it.
Data once stored on the blockchain can’t be altered or deleted, even by the issuer or owner of the network. Any alteration to the original document is assigned a unique hash value and considered a new document. This serves two purposes. One, your digital data remains protected. Two, you (and other authorized users) can track the changes made to the original file, when, and by who.
Simply put, no one can pass an altered file as the original agreed-upon document since the original’s hash value won’t match with the altered document’s hash value, signaling that changes were made.
Centralized servers often have a single source of truth. This makes it easier for sophisticated hackers to get into the system and steal or leak data per their prerogative. However, decentralized blockchain technology changes things since the data isn’t stored on a single server or device. It’s distributed across the network with multiple computers thrown into the mix. So, finding and manipulating the unified source of truth becomes difficult. Plus, even if a device on the network is compromised, it has no bearing on the other computers and business runs as usual.
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Besides securing data, decentralized blockchain gives users absolute control over their data. Users no longer have to rely on centralized authorities to keep their data safe. With decentralized digital identities, they can assume charge of their personally identifiable information (PII).
Zero-knowledge proofs, like decentralized identifiers, help individuals share their information the way they want, with people and organizations they’re comfortable sharing the data with, and only the required data. Decentralized identity solutions ensure an individual’s personal details aren’t shared with others unless they consent to it.
Even though it’s difficult to breach a blockchain network and steal sensitive information, it’s not impossible. However, blockchain has a fail-safe in such situations, too. Data stored is encrypted and can only be decrypted if the bad actor has access to its corresponding public key.
Although decentralized identity blockchain helps users share their data and reveal only the required information, it enhances transparency by allowing authorized individuals to monitor a document’s journey from the day it was issued (provided it was issued on the blockchain; otherwise, the day it was secured on the blockchain will mark its beginning).
Ready to let blockchain protect your data and support your digital identity management efforts? Sign up on ProofEasy to secure all your digital documents and issue verifiable credentials today!