Digital identity security becomes vital in an increasingly risky world

A digital identity is a collection of data points that identify an individual or ogranisation. Advanced technologies are being used to create and protect digital identities

Digital identity and its protection have become increasingly crucial for people and organisations. Without authenticating identity, it is nearly impossible to conduct basic tasks at home and work. Some of the smartest new technologies are being used to create and protect digital identities.

 

Digital identity spans a wide spectrum of activities but it can broadly be classified into privacy and security. A third dimension is to detect and prevent breach and fraud. There are numerous categories within the label of digital identity, including creating credentials, master data management, financial transaction and authentication protocols.

 

The world market for digital identity is worth $961 billion and is projected to grow to $1.33 trillion by 2025, according to an assessment by 1414 Ventures. The venture capital company says that the key driver for the market’s growth is the demand for seamless user experience. There is a growing need for frictionless and convenient access to digital services across multiple devices. The growth in breakthrough technologies like blockchain and artificial intelligence requires data guardrail solutions. 

 

“A digital identity is a collection of data points that comprise the characteristics, attributes, and activities that identify an entity. Along with authorisation technology, digital identity verifies a person, organisation, application, or device as both authorised to access certain assets or data and as the legitimate holder of that access,” according to technology giant Oracle. This entity can be an individual or an institution. 

 

In many countries, including India, safe and connected digital identification platforms allow passengers to walk through security and immigration at airports. Financial transactions that once required a physical signature on cheques are now done seamlessly with digital identifiers. Even passports are likely to become digital as global collaboration is underway.  

 

Then there are digital identifiers of objects and devices. So far identities of individuals and institutions were converted into digital formats with interoperability. With hundreds of billions of connected devices, each needs its unique identifier. 

 

For nonhuman entities, like internet of things devices or a microservice (a software development method), a different approach has evolved. Such entities now include information embedded in hardware-based unique device identifiers and digital certificates issued by trusted organisations. Oracle says that device identities can be corroborated through their associations with other devices or the platforms to which they connect. For instance, identifiers for a door sensor in a smart security system might be the Cloud platform it transmits data to or the machine-to-machine connections it has (cameras and other devices). Each element within the security system can have its own unique identifier. According to Oracle, these unique identifiers are helping companies quickly and accurately locate products, monitor inventory levels, and prevent counterfeiting and fraud.

 

Fraud and counterfeiting involving physical documents are common and such risks continue in the digital identity world as well. However, digital risks could be more harmful as cyberattacks can lock or delete identities at a mass level. Without a backup of physical documents, a purely digital identity can be highly risky. 

 

Emerging technologies that create digital identities are also helping secure them. Bleak scenarios are offered in popular fiction about individuals being cancelled since their digital identity is hacked or deleted. Since such scenarios are a possibility, technology providers, regulators and policy makers have to collaborate to strengthen digital identity platforms. Apart from individuals and institutions, even devices and appliances need the highest level of security and data protection. Currently, only a few transactions of our daily life are enabled by digital identities. As digital transactions expand to many more human and organisational activities, expect wider and stronger efforts to protect and secure digital identities.