Digital Identity, Privacy and Security in The Modern World


In the modern world, technological innovations arise at a breathless pace. It’s often difficult to keep track of the latest trends and predict which will become permanent fixtures in society. Our increasingly-interconnected world bombards people with an enormous amount of information that is impossible to consume entirely. It’s difficult to sort through all the self-promotion, armchair speculation, and sponsored content to form a balanced analysis of the latest technologies and rising trends. Instead, it’s more useful to look at the undercurrents beneath the tides of innovation. More specifically, the themes of digital identity, privacy, and security lay at the heart of all disruptive innovations like Bitcoin, mobile applications Signal and WhatsApp, and social media and sharing economy platforms.

The Big Picture

Companies and governments fight for control over access to user information in order to maximize advertising dollars, maintain political power, and monopolize marketplaces. Until the rise of sharing economy platforms, large traditional companies had a complete monopoly in a variety of industries, such as hospitality, personal banking, finance, and taxi services. Now companies have shifted power back to the consumer by allowing individuals to assume the role of these entities in peer-to-peer transactions. Already, the sharing economy has seen extremely rapid growth and will continue to become a part of everyday life.

Despite the disruption the sharing economy has generated, there’s still control over user information in the hands of private companies. While the sharing economy has helped to reduce the power of large, traditional corporations, individuals must still place a lot of trust in the security promised by the companies who built any given sharing platform.

However, new technologies emerged, affording individuals greater and secure control over their own data.

Reputation Services And Blockchain

Usually, user ratings & reviews are tied to a single platform and individuals have to start from scratch if they want to build their reputation on another sharing platform. Thus, deemly affords users greater control over their data by allowing them to utilize their entire digital reputation as leverage to prove their trustworthiness across peer-to-peer marketplaces. Users can voluntarily connect their social media and sharing platform accounts in order to use their trust profile, which is based on the ratings and reviews they’ve received on connected accounts. All of this happens when users sign up to a new platform and the deemly technology extends the sign-up flow with a seamless integration where users can build their trust profile.

Mixing user identity and rating services with blockchain technology could result in an even better final product. As mentioned above, ratings and reviews are usually related to a specific service and are owned by the company/person behind it. You may have a very high rating on a certain website, but if that website disappears your clout there will also perish. The structure of the current digital reality is based on clusters of information, made available by large companies. Our online existence is entirely dependent on centralized services. Our digital identities and reputation are owned by a handful of people. We pay them with information about ourselves, oblivious about how that information is actually used (and by whom).

There might be a better way to organize our presence in the digital space.

“Digital identity on the blockchain is a match made in heaven, keeping our personal information secure and private but shareable on a trusted network, and made available only to those that need to know” (1)

Blockchain technology provides a new way of storing information without the need of a central authority. In the case of Bitcoin, the blockchain stores information about the balance of each Bitcoin address. The same approach could be applied to many other types of information. Data about anything that could be represented digitally can be stored on a blockchain and made accessible by anyone with the proper decipher tool.

Immutable, public and at the same time – encrypted information could be the key to better identity and reputation solutions. Systems that provide users with the ability to have improved control over their digital privacy, sharing personal information only if needed.

Unlocking The Future

Services like deemly will continue to act as trusted third parties who confirm the validity of user-provided information, but the information itself will not be owned or stored by them. Once confirmed, it will be up to the user to delete it or provide all or part of it to other services.

In order for this to be realized, blockchain technology would need to evolve. The primary problem of public blockchains today is the high cost of adding information. In Bitcoin, for example, in order to “write” on the blockchain one needs to do a transaction. Once written and stored (added to a valid block), the information cannot be edited. The only way to change the information is to “replace” it with a new one (the old data will still be there). That requires doing another transaction, which currently costs between 1.5 and 3.5 USD. That is quite expensive, having in mind the number of users that may be interested in using such a platform. The world needs a more affordable solution. That will be available soon.

In addition, æternity is building a public blockchain for a scale that could address the needs of an application-rich environment. They want to provide users worldwide with a platform that could handle the heavy transactional load at a low cost. The key to achieving this goal is a new technology that enables “state channels”. They run in parallel to the blockchain and reduce its load significantly without compromising security.

Whether it will be æternity, the lightning network in Bitcoin, the “Proof of Stake” upgrade of Ethereum or any other emerging project, scalable blockchain technology will change the world for the better.

Scalability improvements in blockchain technology will enable the creation of powerful decentralized applications, changing the paradigm for online digital identities and reputation systems. We are the beginning of a revolution as big as the internet that will allow users to manage their online presence better, protect their personal data and even be financially rewarded for revealing information about their tastes, character, and habits. This will enable a true sharing economy by reducing the frictions of economic interaction for individuals on a global scale.

NOVAE – An aesthetic vision of a supernova from Thomas Vanz on Vimeo.

1) It Was Only a Matter of Time — Digital Identity on Blockchain, March 24, 2017 By: Stewart Bond

This article was written in collaboration with Vlad Dramaliev, Marketing and Community Manager at æternity and originally published at