Is blockchain a suitable technology for the purpose of online identity management

Organizations and governments are also concerned about the security of the data they have for their stakeholders and citizens. The question of the most suitable way for online identity management has been on the rise. Blockchain technology has been proposed by many people but there is need to know whether the technology is suitable. In this research paper, we focus on the suitability of blockchain technology to provide clarity on whether it is appropriate when it comes to online identity management. Key Words—Blockchain, digital identity, identity management Table of Contents Abstract 2 Student Declaration 4 CHAPTER 1 5 1. 8 Research Questions 11 1. 1 Main research question 11 1. 2 Sub research questions: 11 1. 9 Research Limitation 12 CHAPTER 2: Literature Review 13 2. 1 Theoretical Background 13 2. 4 Architecture of Blockchain 19 4. 5 Where Does a Blockchain Make Sense? 20 CHAPTER 5: Conclusion and Recommendations 22 References 24 Student Declaration This research project is my own original work and has not been presented to any other institution for the award of a degree or any other award.

Name Registration Number Sign…………………………………………………………………………………… Date…………………………………………………………………………………… This research project report has been presented for examination with our approval as university supervisors. Supervisor 1 Sign……………………………………………………………………………………. Date……………………………………………………………………………………. This single digital identity can always be updated using the latest user information. Given this potential, many companies and organizations are developing blockchain-powered solutions for authentication and digital identity management. Some of these companies include Cambridge Blockchain LLC, Existence ID, BlockAuth, Civic, and Bitnation. Companies such as Cambridge Blockchain LLC are working with financial institutions on a very user-friendly digital identity solution that complies to all regulations related to privacy. To create confidence from potential clients, the solution will have to be so robust and user friendly. Thus, how to manage an identity over the Internet becomes an important problem for both the Internet companies and academic researchers.

Many efforts have been taken to seek effective approaches in protecting the personal data security. However, the personal data is traditionally stored in a centralized server, which makes it possible for hackers or attackers to achieve their malicious goals by stealing/misusing/manipulating these data in this centralized server. In 2008, Satoshi Nakamoto proposed the concept of Bitcoin, where users trade freely on the Internet without a credible/trusted third party (Fitzgerald, 2013). Because the popularity and fast development of Bitcoin, Blockchain that the technology supports Bitcoin begins to take the public attention. 3 Blockchain Technology Blockchain is a distributed database system, which can also be treated as a public ledge that is maintained by lots of independent users. Once a transaction is written in a block, the transaction data has to be agreed by all the nodes in the system and the data cannot be further modified by any node (Salido, 2016).

If the data in a block on the chain is illegally changed, it will affect the entire chain after this block and other nodes will not acknowledge the validity of the data on the chain. The participants or nodes in the system are not necessary to Blockchain is best known as the underlying technology of the Bitcoin cryptocurrency. It functions as a Distributed Ledger Platform (DLP) and contains the rules of the platform and the ledger of all transactions since the beginning. The need for blockchain based identity management is particularly noticeable in the internet age, we have faced identity management challenges since the dawn of the Internet. Prime among them: security, privacy, and usability. While there exist somewhat imperfect systems for establishing personal identity in the real world, in the form of identity document, driver’s licenses and even passports, there is no equivalent system for securing either online authentication of our personal identities or the identity of digital entities.

So, while governments can issue forms of physical identification, online identities and digital entities do not recognize national boundaries and digital identity authentication appears at first look to be an intractable problem without an overseeing global entity. The solution can help the organizations to check the identity on every transaction in real time, hence, eliminating rate of fraud. In an alleviated version, trust requirements are transitioned from one party to several parties, potentially not covering all nodes of the blockchain network. To enable the trust shift, the rules that are supervised by the central governance body are required to be digitally represented and enforceable in the decentralized network. Overall, using blockchain technology and introducing centralized trust dependencies counteract each other. Architectures that are built in this regard may better use conventional technology.

5 Management of Digital Objects Another key factor for the reasonable use of blockchain is the type of commodity that is managed using a decentralized network. A solution to process external input on blockchain-based applications is an oracle. An oracle is queried during the execution of a decentralized program and provides the required information. Depending on the structure of the oracle, a trusted third party might be introduced, and the first key factor is impaired. As an example, Schelling Coins are a proposal for a decentralized oracle. Overall, an artificially created digital association may undermine the original purpose or limit or even eliminate, respectively, the benefit of applying blockchain technology. • To examine the design for blockchain and 1. 8 Research Questions To explore the potential of creating a self-sovereign identity solution with blockchain technology, the following questions have been formulated: 1.

1 Main research question • Is blockchain a suitable technology for the purpose of online identity management? 1. 2 Sub research questions: • What are the properties of current digital identity management systems? • What do consumers expect from identity management systems? • What does characterize blockchain technology? • Can blockchain technology be used as infrastructure for identity management? • What does an architecture for a DIMS look like? 1. 9 Research Limitation Since the current domestic research on blockchain hasn’t been systemized and deepened and it is difficult to find articles about blockchain on CSSCI, so our Chinese literatures aren’t from the top journals. , each block contains a reference to the previous block. A so-called consensus mechanism determines the correct order of transactions (i. e. , in the blocks) as well as the correct order of the blocks (i.

e. Other users can derive the integrity of the signature from the calculated value using the publicly accessible public key. Moreover, governments increasingly store in a digital form biometric characteristic to identity travelers, migrants and refugees. For example, European airports have begun to use face recognition software to match passenger faces with the image stored on the passport’s chip. In a Jordanian refugee camp near the Syrian border, the World Food Program in cooperation with the UN also uses blockchain and iris scans to identify refugees and distribute food fairly. In addition, refugees can shop in the camp ‘s supermarket and pay by Iris Scan 2. Blockchain is a candidate infrastructure to solve this lack of interoperability, and store and provide unique digital identities.

Research is consequently interested in understanding blockchain-based platforms. For such platforms, blockchain not only provides unique digital ID capabilities but empowers participants by ensuring data sovereignty and direct transactions without the need for an additional intermediary (Avital et al. , 2016; Subramanian, 2017). 4 Blockchain-based Platformization of Digital Identities From literature and our interviews, we identified a set of challenges for a blockchain-based system that platforms digital identities in the public sector. , software updates and hardware replacements) is a decisive factor. Consequently, non-experts must be able to supervise the system. On the user's side, graphical user interfaces must be user-friendly and barrier-free. Challenge 3, functional: Ensuring flexibility, process integrity, and analytical capability First, the system must ensure that it is suitable for complex processes such as the asylum process in Germany.

In addition, the systems must guarantee process integrity (e. X-Road only serves as a middleware and challenges data flows between organizations. Since states will be reluctant to grant other states and countries unchecked access to data on their citizens, creation of such a neutral system is also relevant in the German and European context. Challenge 5, legal: Ensuring compliance with all applicable regulations and laws CHAPTER 3: Research Methodology 3. 1 Introduction This part discusses the design of the research and methodology to be used in the study. The target population, data used, instruments used as well as data analysis tools are also to be explained. 2 Blockchain technology market The blockchain technology market, according to our data, continues to grow exponentially over time as shown in the representation below.

Blockchain use in online identity management has been observed to increase from about $ 200 million in 2016 to about $ 500 million in 2018. Projecting forward, the market is expected to grow to about $ 2300 million in year 2021. This clearly indicates the usage of blockchain continues to increase with time hence the system can be deemed effective compared to other systems of online data management. If the market continues to grow, the use of blockchain for online identity management also grows with time hence it is suitable, based on this data. High-level architecture overview 4. 5 Where Does a Blockchain Make Sense? In general, using an open or permissioned blockchain only makes sense when multiple mutually mistrusting entities want to interact and change the state of a system, and are not willing to agree on an online trusted third party.

We consider one or multiple parties that write the system state, i. e. a writer corresponds to an entity with write access in a typical database system or to consensus participant in a blockchain system. e. they assume that no participant is malicious, a database with shared write access is likely the best solution. If they do not trust each other, using a permissioned blockchain makes sense. Depending on whether public verifiability is required, anyone can be allowed to read the state (public permissioned blockchain) or the set of readers may also be restricted (private permissioned blockchain). If the set of writers is not fixed and known to the participants, as is the case for many cryptocurrencies such as Bitcoin, a permission less blockchain is a suitable solution.

e. in a blockchain setting, a writer corresponds to a consensus participant. If a trusted third party (TTP) is available that is not always online, this can be used to establish a known group of writers, i. e. the TTP can function as a certificate authority in such a setting. Transparency Regulation, openness and transparency of both data and processes can be supported using blockchains for documentation – the redundant sharing of data across all nodes in a typical public blockchain network, strong identity frameworks and transaction immutability allows easy and trustworthy tracing and audit of activities, relevant, for example, for identity, medical processes, financial and currency use, spending and procurement. Efficiency Blockchains are often used for disintermediation; many tasks can be carried out reliably without a need for other parties to be involved.