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Decentralised Identity – What is the Web3?

The web has evolved steadily over the past thirty years. In Web2, interactive content moved into focus. Closely linked to this development is the creation of digital identities. In the analogue world, one’s identity is proven, for example, with a driving licence or an identity card. The digital identity is therefore often understood as the counterpart to official identity documents, but this is not entirely accurate. The digital self is more than a simple identity card and can contain numerous personal features. On the web3 , this form of identity plays a central role.

Key Points

  • The web3 defines itself through the handling of digital identities
  • Central data silos are broken down in Web3
  • Users thus regain control over their digital identity
  • In addition to these advantages, users benefit above all from the easy accessibility of the new technology

What are digital identities?

Numerous services on the Internet require a login. Credentials consist of an e-mail address or a user name and a password. These credentials are already a simple form of digital identity. Characteristics that identify the user beyond doubt are therefore called digital identities.

Digital identities can be supplemented with attributes. For example, address, date of birth, educational qualifications, the number of the identity card or credit card information come into consideration here. The digital identity thus also contains very sensitive information about the user. If he loses access to it, this can cause great damage. Furthermore, the storage is currently mostly done centrally at the companies. Users have to trust them, but ultimately have no guarantee that their data will not be misused. Over time, digital identities accumulate with many different service providers on the internet.

Digital identities as a part of the web3

Logging in via credentials and depositing personal data with companies has always been part of the internet and is not a new development. However, due to the multitude of possibilities offered to users today, the number of digital identities held by each person has increased significantly. On the web3, the way digital identities are handled differs from what is currently common.

Companies store large amounts of personal information about their users, whereby the latter have no control over the further whereabouts. The storage of digital identities is no longer centralised on the web3. Users bring their own identities with them. The data is stored by the users themselves in their own – often local – software wallet. Companies receive encrypted certificates that identify the owner beyond doubt. Blockchain technology provides the solutions for this, guaranteeing that the transmitted certificates are forgery-proof.

Advantages of self-sovereign identity and decentralised identity for the user

Processes for legitimation are currently cumbersome and not user-friendly. Each service requires its own login. Occasionally, digital identities from Google, Apple or Facebook can be used to access third-party services. However, this enriches the digital identity with further information that remains in the possession of the companies. Furthermore, central identities such as the Google or Apple ID are not cross-compatible.

The blockchain-based decentralised identity that gives the user back control over his data is also called self-sovereign identity (SSI). It is interoperable, which is why one login is sufficient for all services. This is more user-friendly than before and significantly more secure thanks to blockchain and wallet. Furthermore, the open interfaces are suitable for using the SSI not only on the web3. A monthly ticket, housing permit or access authorisation for the gym can also be stored in the digital wallet. From the user’s point of view, control over sensitive data is the most important argument for self-sovereign identity. Positive side effects are the easier handling of the digital identity and security aspects.