What is Digital Identity? NZ’s Easiest Digital ID Rundown


Industry experts agree that one of the next big applications of blockchain technology will be digital identity, a concept that is believed by many to be one of the most significant technology trends on the planet. Digital ID technology will not only pave the way for blockchain Smart-Contracts, but also immensely increase the security and integrity of our personal information.

Digital Identity is a total game changer, considering it not only has the potential to virtually eliminate identification fraud, but also the faculty to tether up ownership of a whole range of assets to your cryptographically secured signature.

Computer keyboard button with blue fingerprint
Computer key with fingerprint. 3D render.

As an individual, you Identify yourself in many ways, including your name, address, age, profession and more. You see this identity in many forms, like on your driver’s license, your birth certificate, your work cards and your passport, which are all various forms of identity instruments.

Now think about all the way’s that you identify yourself, and then multiply it by all your daily online and offline interactions, such as buying something from the web, applying for a visa or calling up your bank. Juggling all of these accounts and identities can be outright tedious, but with digital identity in the cards, all of these identity instruments and accounts can be linked to one central ID, your digital ID.

suited man with digital identity represented by his thumb print

What is Digital Identification?

A digital identity is a central storage location for information on an entity, to be used by computer systems to represent an external agent. That agent may be in the form of a person, organization, application, or device. This technology is nothing new though, as one can already use their digital identity to authenticate themselves on another service, e.g, to log into your Spotify with your Facebook account. Blockchain digital identity, however, is where the real magic lies.

When you sign up to a new service, even though you do own your password, you do not actually own your identity. The truth is that your identity is in the hands of a central point, making it vulnerable to attacks and hacks if this central system’s security is compromised. This is why blockchain has an appealing trait for digital identity, as it offers an avenue where you and only you are in control of your ID.

man holding icons on various assets to represent digital identity

Decentralised blockchain digital identity provides the user with the power to be fully in control of what information lies on their various accounts, meaning that rather than an account on a website having its own version of your digital ID, it will simply have access to your blockchain-backed digital ID instead. And that access is controlled by you, and can be revoked at any time.

For this reason, you can know that every account linked to your blockchain ID will be fungible, and you can update and change this ID at any point. More importantly, you can choose whether to make your information private or public. These attributes are major game changers to the privacy of your information, as it will directly prevent services like Google and Facebook from harvesting your personal information without consent for commercial use.

In the same way that cryptocurrencies can enable the user to take back control of their finances from the established central authorities, decentralised digital ID has the power to do this with your information too.

blockchain background to represent digital ID
Block chain network and programming concept on technology background

How Can Blockchain Digital ID Help Us?

There are currently 1.1 billion people who live with no formal identity at all. Without a valid form of ID, an individual can not own property, vote, receive government services or open a bank account. Even more importantly, without the control over one’s own identity, it is easy to become virtually invisible, placing you in the role of a spectator, unable to partake in society simply because one can’t prove that they are who they say they are.

picture of earth from space next to the ISS

Identity is the crux of service delivery, and relying on physical identity documents can be unsafe, inefficient and expensive. It is believed that digital identity cannot only solve all of these problems, but also provide us the ability to streamline payments, ownership and contracting. In the next 10 years, it could be the standard that the deed to your house, the registration of your car and the money in your bank account will be linked to your digital ID.

Things that digital identity can be tethered to

This is just the beginning, however, as it is likely that we will also tether up such things as our debt, our equity, our insurance, our intellectual property, our medical information and our social media accounts among other things. With 63.4% of all internet use being on mobile, and with 68% of the world’s population expected to be living in urban areas by 2050, It is expected that digital identity will make a profound impact on the how we build future ‘Smart Cities’.

Digital Identity is not a fantasy idea either, as some of the largest governments in the world are currently working on their own digital ID systems. The UN and World Bank already have a goal of providing everyone on the planet with legal ID by 2030, however other countries are already making huge strides towards making digital ID the reality. Examples include new schemes in France, Canada, Italy, Belgium, Poland, The Netherlands, and Norway.

connected earth with ones and zeros shooting from it

How Is Digital Identity Unfolding In New Zealand?

Managed by the Department of Internal Affairs, RealMe has been our national ID service since July 2013. Since then, 130 services across 37 organizations use RealMe as their login, and on the day that this was written, 555,783 Kiwis have digital IDs with RealMe. However, this uptake has been significantly slower than forecast, and investment in to future development is uncertain.

On the other hand, the Digital Identity NZ group (part of the NZ Tech Alliance), is currently the spearhead of NZ’s efforts to research, develop and manage digital ID. So far little has been announced about using blockchain as the backbone for these efforts, however, given the ability of blockchain technology to help deliver huge benefits in the space, it’s likely to be under consideration.

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