How blockchain technology is revolutionizing digital identity and credentials for digital certification

Imagine how easy it would be if you could store and access all your important documents like a driver’s licence, insurance card, student or work ID, passport, and even immunisation records digitally. The use of credentials as a tool for identification and verification has existed for a long time. The idea of obtaining documentation that proves qualification, competence, or authority is not, by itself, a novel idea. However, with the recent introduction of verifiable digital credentials, this entire process has become much easier, faster, and more accessible.

The digitization of credentials has the potential to have a significant impact on those routine daily tasks that we continue to perform without giving them much attention. While smartphones and the internet have been around for over a decade, digital credentials have only recently entered the picture. This is because the underlying technology – Blockchain – that enables verifiable digital credentials has only recently reached the necessary maturity level for widespread application and adoption.

The use of blockchain technology has made Web3 applications more efficient, secure, and cost-effective. They allow users to physically or digitally submit information with a credential to a verifier, who can then easily confirm whether the credential belongs to the said user. This way, the difficulty of managing several physical papers or documents is eliminated, fraud risk is reduced, and holders can choose to communicate only the information they need with the asking verifier. 

Digital credentials are expected to be adopted gradually, starting with more obvious use cases. Businesses and governments with speculative use cases will likely gamble on digital credentials once their workings and advantages are understood by early adopters. Some of its initial use cases could involve licences for occupations and professions, permissions for leisure activities, credentials for education, and vaccine verification. The use of credentials for confirming the authenticity of tangible objects is also expected to gain traction once the initial adoption phase kicks in. Individuals and organisations would be able to use this to confirm the legitimacy of parts, apparel, sporting goods, and other stuff.

The medical field is another area where blockchain-based digital credentials are expected to be adopted in a big way. For example, in the current medical setup, verifying information for new doctors is both time-consuming and costly, and it typically involves 12 to 25 different organisations. As a result, the onboarding process for new employees stretches on for over 4-6 months, which causes hospitals to lose a lot of money and resources as a result of this time-consuming process. On the other hand, if medical credentials were being maintained on a blockchain network, the recruiting hospital would be able to check a new hire’s certificates in minutes as opposed to months, and save themselves both time and resources.

Similar to medical credentials, health records and driver’s licences are also expected to be credentialed during the initial implementation phase. It would be safer and more secure for people to be able to hold their health information and driver’s licences online. How often does it happen that we end up giving third parties access to more information than necessary? For instance, there should be no need to reveal any extra information, such as your residence or full name, if a verifying party only needs to confirm your age. All this will become possible with the use of digital credentials, as it will allow users to validate the required information while keeping the rest of their data secure and hidden from the verifying party.

Education is another sector where blockchain and digitisation could become major growth drivers in the years to come. Students’ educational achievements, such as academic transcripts, work history, and skill credentialing, are frequently dispersed across multiple institutions, disparate IT systems, and difficult to manage hard copies. Using new-age Web3 applications, educational institutions will be able to easily automate and streamline most of their activities. They will be able to make use of portable digital credentials to reduce administrative costs and improve job opportunities for graduates, among other things. From enrolling students to long-term transcript verification, in addition to routine activities like attendance, assignments, examinations, etc., blockchain-based applications will help them take care of all their institutional activities.



Views expressed above are the author’s own.


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