What is KEY - Selfkey?
At it’s core, Selfkey is an identity system that is built on an open platform comprised of the Selfkey foundation, an open-source software identity wallet, as well as a marketplace with real products and services already available.
Today an individual (IO) must prove to an establishment (RP – Replying Party) that they are who they claim to be. Each individual has a paper ID (proof). When an individual sends an electronic copy of their ID, they must certify the copy sent is of the true original. The electronic copy becomes an identity claim (claim), which receives an attestation from a notary and becomes a verified claim.
Selfkey firmly believes digitally verified claims are the future for digital identities
- Centralized databases containing high volumes of identity information are a high-value target to hackers. The reward of a successful breach increases exponentially relative to the number of identities contained within the database. For example, there have been past hacks committed against Facebook for identities.
- If a centralized database experiences a failure, the whole network is effected in such a way that it could become inaccessible to users. Recently, Wells Fargo experienced an outage caused by a fire that made accounts inaccessible to users.
- Access to data is restricted by the operators to provide mild security in traditional identity systems. However, the identity owner cannot access their own data.
Laws are put into place to make certain that policies and procedures are utilized to protect personal data under the threat of large monetary penalties and even possible imprisonment for doing so. However, these laws widely vary based on the jurisdiction in each location.
The Importance Of Identity Systems For KYC
Because KYC laws are both national and international in scope, they affect a large group of diverse parties who must follow them. In addition, the KYC process is mandatory, expensive, and identity data is unable to be reused.
This makes the entire process cost more for identity owners, but it also exposes them to a higher risk of identity theft. In our digital world, the current KYC system is abundantly inefficient.
A possible solution to the problem lies with Selfkey. By linking, re-using, and easily porting data in such a way that KYC laws are complied with. Thus easing the cost and time required by individuals and enterprises when undergoing the KYC process.
Due to inefficiencies in the current process, each time an identity owner must change or use a new provider, the same checks must be done over again by the new relying party. Identity data cannot be shared or “ported” to the new provider, which leads to your identity being stored in many centralized systems at once.
In addition, your data can be held in a system for years, even after you stop using a service provider, leaving your data needlessly exposed. Changing service providers have high costs involved and that creates a barrier to exit, which leads to an uncompetitive business environment for providers.
Although a high exit barrier is beneficial to a business, the process is detrimental to identity owners, startups, and dampens innovation. Worst of all, the risk of identity theft generally increases for the individual.
SelfKey - The Self Sovereign Solution
With Selfkey, we can escape the outdated system of paper-based documents, and transition into an age of digital identities in which we have privacy, security, transparency, and individual rights through the Selfkey solution.
However, Blockchain does not solve all of the problems.
A distributed ledger storing personal identity information would be managed by many of the participating network members. The process could potentially breach data protection laws depending on various laws in different jurisdictions as well as an increased risk if data were to be stored on every node participating in the network.
Today, many of us store our identity documents including passports, birth certificates, and social security numbers in our homes safely under our own control. Only sharing them with third-party entities when it is necessary. Selfkey is the digital equivalent of what we already do when handling our physical identity documents.
How does Selfkey work?
New users begin by downloading the Selfkey wallet application. Your personal data is stored locally, on your own device. You will be able to back up your information onto other personal devices as well.
After the wallet has been downloaded, the user will generate a public/private key pair, which will act as the user’s digital pen. The digital pen is used to apply the identity owners unique digital signature onto digital documents.
Because the private key is known only to the identity owner, it serves to authenticate an identity when it’s requested by parties for verification. Each Selfkey is unique to its owner much like a digital fingerprint.
Now that the identity container has been created, no one, not even the Selfkey Foundation knows this information because it was created solely by the users. That is what it means to be self-sovereign.
Users can now send identity proofs to receive attestations from entities able to verify them. Such as notaries or government institutions. After the attestations are verified and stored in their digital wallet, they will have access to the Selfkey marketplace.
After attestations have been verified, the user must create identity claims by filling out a text field with relevant identity information such as date of birth, nationality, occupation, etc.
These forms are required in order to comply with traditional KYC documentary procedures. But Selfkey hopes to override this process in the future with digitally signed attestations thereby eliminating identity documents as we know them today.
The KEY token will allow users access to products and services in the Selfkey ecosystem. For example, KEY can be used to pay for request attestations, receive identity claims, and any future additions that would provide value and incentivize growth.
The Selfkey identity solutions systems plan to ease the onboarding process of KYC regulatory measures through a digital identity document system to reduce the associated costs, provide self-sovereign identity, and disrupt the model of paper-based identity documents entirely.
Thank you for reading Black Moon Research!
Investing in cryptocurrencies and Initial Coin Offerings or ICO’s is a highly risky as well as speculative financial maneuver. This article is not a recommendation by Black Moon Research or the author to invest in cryptocurrencies or ICO’s. Since each individuals situation is unique, a qualified professional should always be consulted before making any financial decisions. Black Moon Research makes no representations or warranties as to the accuracy or timelines of the information contained herein.
Follow us on: