What Is Identity Management and Blockchain's Impact on It - Coindoo

What Is Identity Management and Blockchain’s Impact on It

Editorial Team Avatar
Jan 13, 2019
4 min reading time

Over the past 20 years or so, the online world has started to have increasing importance for our daily life. So much so, that it wouldn’t be an overstatement to say that most of us live online nowadays.

Each day, billions of people use the Internet to carry out various, more or less useful, activities including playing games, reading, research on academic topics, accessing various social media platforms, and even carrying out financial transactions.

And, the more activity one has online, the bigger his or her footprint will eventually be. While it is true that the Internet offered us a new way of interacting with services from around the world, and has made our lives undoubtedly more convenient, it also gave birth to a very big problem, that of being able to hold onto your anonymity.

If you have even the smallest experience in the online world, then you probably know about some of these modern-day verification systems that require personal information from the users. While identity fraud is a phenomenon almost as old as society itself, the digitization of modern living has brought with it a lot of risks. Nowadays, it’s not that hard for hackers, fraudsters, and tricksters to pull off elaborate cons with nothing more than an Internet connection.

This is where identity management comes into play, a concept that needs to constantly evolve in order to meet these new challenges the modern-day online world brings with it. In this guide, we will look at what is identity management and how can blockchain solve various problems regarding identity management.

What exactly is identity management?

In short, identity management, also known as identity and access management (IAM), is the ability of individuals or corporations to access the right resources at the right times and for the right reasons.

While this explanation might seem a bit too vague, then consider the fact that identity management covers aspects such as how users gain an identity, the protection of that identity and the technologies supporting this specific action. At the end of the day, identity management is the cation of fully controlling information about a specific user.

While cryptocurrencies and cryptocurrency networks continue to flood headlines, it’s the blockchain that is the real hero, as many believe that its future applications will help solve at least some of the issues that affect business and people regarding identity management in the online world.

Source: WSO2

How can blockchain solve identity management solutions?

There are those who believe that blockchain technology can solve the need for intermediaries and allow individuals total control over their digital identities. It’s believed that blockchain technology can eliminate the need for intermediaries, thus allowing individuals total control over their digital identities.

The fact of the matter is that blockchain is introducing key qualities that are missing from most of our typical systems. Blockchains offer decentralization, immutability, and public key cryptography among others.

Centralization, for instance, has always been one of the major problems when it comes to ensuring one’s privacy. Over the course of its life, the Internet became increasingly privatized, and more and more small or big companies started to gain control over how online identities are curated.

It’s this type of forced centralization that allows companies to store huge volumes of personal data, usually housed on servers, from basically anyone who uses the Internet. As we all know, there have been numerous hacks in the history of the Internet, most of which resulted in big personal data leaks.

Hence, blockchain technology can be a potential solution to the problem outlined above by enabling users to store data on a blockchain, rather than servers can eventually be hacked. Imagine, by using blockchain, the information is stored on the blockchain, is secured cryptographically, and cannot be modified or deleted.

It’s important to note that blockchain-based identity management systems are still very new concepts and are very much in their infancies. However, there are a few crypto/blockchain projects that have “taken matters into their own hands.” Civic, for example, is a personal identity verification protocol/platform that intends to eliminate usernames and passwords altogether and plans to “replace” them with biometrics (thumbprints and eye scans).


Blockchain technology may very well be the way forward for developing a comprehensive identity management system that gives users full control. However, blockchain technology may work very well in some types of applications for identity management, but it might now work at all in others. It’s true that data security and identity management seem to be some of the top use cases for blockchain technology, but there’s still a development that needs to be done in order to make this happen.

* The information in this article and the links provided are for general information purposes only and should not constitute any financial or investment advice. We advise you to do your own research or consult a professional before making financial decisions. Please acknowledge that we are not responsible for any loss caused by any information present on this website.
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