Decentralized Identifier (DID) Definition
The term “Decentralized Identifier (DID)” refers to a type of identifier that empowers individuals, organizations and systems to establish verifiable, self-sovereign identities. A DID is completely controlled by the individual or entity that it refers to and does not need to be registered with a central authority because it is registered, updated, and resolved on a distributed ledger.
Decentralized Identifier (DID) Key Points
- A DID is a type of digital identity controlled entirely by the entity it represents, without the need for a central authority.
- DIDs are embedded on a blockchain or distributed ledger, ensuring their security and resistance against tampering.
- The use of DIDs is an integral part of the concept of self-sovereign identity, which prioritizes the individual’s control over their personal data.
- DIDs are fundamentally interoperable, meaning they’re designed to function across different systems and platforms.
- Combined with Verifiable Credentials (VCs), DIDs can enable trust in digital transactions.
What Is a DID?
A Decentralized Identifier, or DID, represents the next frontier in the development of digital identity management. Unlike traditional identifiers such as email addresses or website domains that are issued by a central authority, a DID is a self-sovereign form of identity. It is unique, persistent, and completely controlled by the entity that it represents. The entity can be an individual, a group, an object, or even a piece of data – virtually anything that needs a unique identifier.
Why Is a DID Necessary?
In the digital age, issues of privacy, security, and control over personal information have become increasingly important. Traditional forms of digital identity, where data is stored and controlled by centralized organizations, are fraught with risks – from data breaches to unauthorized surveillance. DIDs address these issues by enabling individuals to control their own identities independently of any central authority. Also, as all transactions related to a DID are recorded on a distributed ledger, it’s nearly impossible to change or remove the information without leaving a trace, enhancing security.
Who Uses a DID?
While the concept of DIDs is still emerging, it’s already finding application in a wide range of contexts. Individuals can use a DID to control their personal data and protect their privacy online. Companies can use DIDs to verify the identities of their customers without having to store sensitive personal data. Governments can use DIDs to streamline their services and reduce fraud. And technologists are exploring the use of DIDs in areas ranging from IoT to blockchain, where decentralized, verifiable identity can add significant value.
When To Use a DID?
DIDs can be used whenever there’s a need to establish a self-sovereign, verifiable identity. Whether it’s an individual keeping their personal data safe while browsing the internet, or a company confirming the identity of their customers with minimal liability, DIDs prove to be useful. Moreover, as blockchains and distributed ledgers continue to evolve and become more integrated into our digital landscape, the use cases for DIDs will likely continue to expand.
How Does a DID Work?
A DID is anchored on a blockchain or distributed ledger network, governed by a set of protocols or rules known as the DID Method. When a DID is generated, it creates a set of cryptographic keys – a public key that identifies the DID, and a private key that controls it. The subject of the DID can then use these keys to sign and verify digital transactions. This allows the DID to function as a self-sovereign, tamper-proof form of identification. And because the blockchain guarantees the immutability and security of the data, the DID can be trusted to be authentic and reliable.
