Using Hyperledger Indy To Reduce Red Tapebr>
Digital identity is becoming a clear contender as one of the most practical uses of a distributed ledger or “blockchain.” Emerging universal standards for verifiable claims create trustworthy digital credentials. When credentials are anchored to a public ledger, they are not only efficient and safe, but unequivocally trusted. These credentials can be determined to be unexpired and valid. We can know who issued them and who they were issued to. This entire digital verification process takes place in an instant and the personal data remains under control of the identity holder. This removes the hassle of usernames, passwords, and the red tape associated with having to repeatedly prove elements of one’s identity.
Take for example the use of decentralized digital identity in the aftermath of an automobile accident. Even the simplest of fender-benders without injuries requires the exchange of a number of credentials between many parties. There may be proofs of insurance issued by the respective insurance companies and vehicle registrations issued by the Department of Motor Vehicles (DMV). Hopefully everyone has a driver’s license issued by the state where they live. If a police officer is present, the officer has a badge issued by the Highway Patrol. Typically, each of these documents are paper, or at best PDFs, and they are exchanged, copied, and filed away–without anyway for them to be part of a digital workflow.
The thought of doing it all digitally conjures visions of complex, special-purpose software systems with uneven acceptance by the various players and jurisdictions. A decentralized identity network provides a flexible exchange of standards-based verifiable credentials. Each of the credentials can be independently created by the appropriate issuer and presented to any party who the holder desires using a digital wallet on their phone. Hyperledger Indy provides the open source tools and libraries to support ad hoc workflows in a standards-based manner without scenario-specific apps and intermediaries.
With a decentralized identity network in play at the scene of the accident, each party can pull out their phones and create a pairwise-pseudonymous relationship with each other and the officer. These relationships allow them to exchange specific information from the credentials they each hold. Even the officer’s accident report could be a credential that can be shared between each party and later with the insurance companies. Even the different auto-body shops that may need to information from the accident could be given the accident report as a verifiable credential. The shops could then provide attestable statements about repair quotes and completion of repairs to the insurance companies all using their digital wallets on a decentralized network.
The standardized and decentralized nature of a blockchain-based digital identity network allows all this information to be exchanged even if there are multiple insurance companies or state governments involved. A digital identity network based on Hyperledger Indy works to reduce red tape by giving the receiver of each credential the ability to verify it hasn’t been altered, that it is about the party who presented it, and was issued by a particular party.
Real life is complicated and messy. The only hope we have of enabling digital interactions that mirrors activities in the physical world is with decentralized systems that allow each person, organization, or thing to act independently and autonomously. While multi-source identity can’t repair your car for you, an open system that supports it can significantly reduce the friction in handling the many credential and data exchanges that are part of any workflow.