Validating identity is a key component to compliance operations across all components of the value chain. From sourcing, manufacturing, distribution and sales, understanding and verifying the information about third-parties, partners and customers is both important and sometimes difficult.
The the Decentralized Identity Foundation notes the following initiatives:
- How people, organizations, and devices can be identified and located without centralized systems of identifiers (e.g. email addresses)
- Secure, encrypted, privacy-preserving storage and computation of data
- Identifiers and names must be self-sovereign to the owning entity, a user's identity data must remain private, only accessible to the entities they allow
- The ability to verify the claims and assertions of identities is key in establishing trust among entities on a decentralized system that lacks a centralized hierarchy
For compliance professionals, we might consider how an improved identity capability enhances our risk understanding of:
- Cross-Border Payments
- Settlements
- Order-to-Cash
- Treasury and Financing
- Supply Chain
The open source project, called Ion, deals with the underlying mechanics of how networks talk to each other. For example, if you log onto Airbnb using Facebook, a protocol deals with the software that sends the personal information from your social profile to that external service provider. In this case, Ion handles the decentralized identifiers, which control the ability to prove you own the keys to this data. Christopher Allen, a crypto veteran and the co-founder of the World Wide Web Consortium (W3C) working group for decentralized identity (DID) solutions, told CoinDesk that Microsoft’s move could impact the entire tech industry. “A lot of enterprise infrastructures use Microsoft products,” Allen said. “So if they integrate this into any of their infrastructure products, they’ll have access to DID.”
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