Digital transformation is the adoption of digital technology to digitize non-digital products, services or operations. The idea is that by digitizing things, we reduce the friction in the underlying business processes and thus significantly reduce the operational expenses. Reinventing the way we do things has the potential for automation and new revenue streams.
This is not a discovery by any means.
Even though digital technology has been developing at a rapid pace, its effective application in our modern society is still not quite up there. We are operating based on “the low-hanging fruit” approach, thus tackling what is easiest to be tackled. Today it is still out of reach for a normal user to be able to establish secure connections with other parties, verify their authenticity and start transacting with them. The full potential of the digital economy is still unlocked. A lot is left on the table.
There is a silver lining, though.
There are three big topics that are getting momentum in the last few years that could prove to be the next driver for the digital economy. They are still developed independently from each other, but a convergence seems inevitable at some point.
In this post we will take a closer look at the first one: Digital Trust.
Trust is a very complicated thing.
It is built gradually and it is lost at the blink of an eye.
We trust the people that we know because we’ve seen how they behave. We trust others because of their reputation. We trust the institutions to do their job because of our own experiences.
Trust is a critical precondition to do business with other parties. We get into commercial agreements with other companies because we trust the legal system will act as its guarantor.
Trust is very limited in scope. We trust someone with a specific topic only. And it doesn’t mean they will trust us with that same topic.
There is something inherently subjective associated with trust. How does this translate to the binary world of the digital realm? How is trust today established in it?
Not only was digital trust not part of the early Internet, but also the very basic precondition - the identity layer - was missing. How can we trust the other party in our conversations when we can’t even reliably identify them?
The attempts to solve the identity problem on the Internet created new problems. Every service provider had to come up with their own solution. Hence the birth of Login Accounts, our gateway to access the services we need. This solution came with a hefty price: even though we share our personal data to register for a Login Account, the created Login Account doesn’t belong to us. It belongs to the service provider and it can be taken away at their own discretion.
The Login Accounts approach comes with well documented drawbacks. It makes the service providers a honeypot for hackers. Even worse, It is also the enabler of surveillance capitalism.
The user experience also leaves a lot to be desired. No one wants to manage hundreds of secure passwords. What is the alternative? Well, one can rely on social logins. That indeed puts a lot of power in the hands of a few social login providers. How can you trust them with your data knowing about the ever-growing high-profile privacy violations?
The reality of the situation is that security experts have been working on the identity problem in the digital world for many years. The applied holistic approach puts the individual at the core of the solution: our data belongs to us, and we get to decide what to do with it. If a solution provider requires our data, it needs to get our explicit consent. Our interactions with other parties should be confidential. We don’t want a solution that allows for easy tracking of our activity by any actors.
Hence the birth and evolution of principles such as privacy-by-design and privacy-by-default. As they became more mature, it was clear that a new type of infrastructure was required to address the requirements.
Today we envision a Digital Trust Infrastructure that will enable all actors from the public and private sectors to collaborate and redefine trust in the digital world. The basic building blocks are already mature and powering the next generation of digital trust solutions
Ok, so there is a solution for the identity problem. What about Digital Trust? How can we utilize this to build complete Digital Trust eco-systems?
The complex, dual nature of trust is taken into account in the Trust Over IP Model, designed to develop a complete architecture for Internet Digital Trust. It combines cryptographic assurance at the machine layer with human accountability at the business, legal, and social layers. An interdisciplinary approach is mandated to be able to cover all the different aspects.
Solving the Digital Trust is an important precondition for the other two topics: Digital Assets and Digital Money. We will dissect all these topics on a regular basis in this space.
As a member of Swiss-based Netcetera Group, Blokverse is focused on delivering enterprise grade products and services based on blockchain technology.
We believe blockchain has the potential to be the ubiquitous integration layer in trustless environments. Based on that premise, we have delivered verify.it (a full-fledged platform for management of verifiable digital credentials) and Maenada (a product suite of self-sovereign identity solutions).
Recognizing the barriers to entry for blockchain technology are still high, we designed a consulting package to assist the businesses along the way. We support with knowledge buildup, planning and execution in all phases, from MVP to pilot to defining migration path for integration with the existing productive infrastructure.