Headline: What is self-sovereign-identity?


Body:  Years ago, I was listening to an NPR article about a young woman in Texas, searching for her identity.     Many are thinking, “duh” because that’s what you do as a young adult.   But there was more to it.   The parents of this young woman saw to it that she didn’t have a birth certificate or a Driver’s License.  (She went to live with grandparents and the paperwork portion of her conundrum got straightened out, due to an action of the Texas legislature.)  I was feeling anger towards the parents, thinking that there could be no reason to do this but some form of child abuse.   But, there was another voice on the report, and that man suggested that this was a HUGE gift they gave her.   He referred to her as a sovereign.   He laid out an argument that had  the trappings of logic, but, reflecting upon it, I began to find holes in his logic.   Fast forward to today and I find a concept related to cryptocurrency, and this is called “self-sovereign identity.”   I wondered if this was the same concept I had heard of, or if this was something new.   Thus began this entry.

The idea of a self-sovereign identity (SSI) begins to make some level of sense when thinking of the Internet as it currently exists.   Want to do business with Amazon?  You have to give them detailed information and then, allow them to observe the products that you order.  Want to do business with Facebook?  You have to setup an account, and then you are trusting them with your pictures and occasionally very personal information.  The SSI paradigm (still very much in the sketch-pad stage of development) would introduce some type of passport that would allow you to reach out to anybody you’d like, directly.   If you are confused, please take comfort from the fact that EVERYBODY appears to be confused on this topic, even the evangelists. 

Is this a solution in search of a problem?

Well, I don’t think so.  In 2021, the average cost of a data breach was over $4,000,000.  But, if each person was effectively rrrr  But, think a little closer to home.   ( I don’t think I’m an outlier here.   Feel free to disagree.)  I live in a rather small apartment, but I still have a bunch of stuff that I could easily do without, and would love to  sell on E-Bay or some similar site.   Now, one problem is that I have mis-placed my password.   But, the second problem is that I don’t entirely trust my anonymous buyer.  The SSI system would go a long way toward solving this hesitation.

More importantly to me, is the robot testing that current websites use.  Whether it’s a CAPTCHA challenge (reproduce the letter string) or the challenge of “click on all pictures with a car in it” I have sincere problems since I am visually impaired.  If I had an SSI system, I could instantly prove my identity as myself, without the extreme frustrations caused by these tests.

Well, this sounds good.   So, what’s the problem?

There are a few problems that occur to me:

  1.   Somebody has to issue this Master password.   If you accept that there is such a central repository, it seems to me that you are violating your own logic for SSI.
  2. They claim that this would relieve us of the  problem remembering all of our 80 passwords.   They are correct here, but, having different passwords augments your security.  If somebody hacks your Facebook password, they do NOT have access to your banking records.   This problem would have to be fixed to make the SSI paradigm work.
  3. Authors refer to the “post-truth society” and “fake newss I think this is an impossible goal within our society.   What MIGHT be possible is training our citizens how to critically think about the information they see.  There are some internet sources that are more credible than others, and if something is really important, people should go to 3-4 trusted sources of information.   If they agree on the larger outline of the issue, then it’s probably a good outline of the issue.   If details are disagreed upon , we should then consider why this person might feel this other way, and consider if we could learn something from this difference in opinion.
  4. The author suggests that this system would be something like a combination of Yelp and Biticoin.  Well, if you are familiar with Yelp, you’ll know how easy it is to leave a savage bad review, in response to an imperfect experience we had there.     If this could be controlled, then, wouldn’t this be a GREAT thing?   I would argue  probably not.   For proof, look at any reports on the use of social scores in China.   This idea is very scary to me because now, one person can’t just destroy your reparation,  they can also impair your financial destiny.

Are there opportunities for you?

Yes, there are opportunities.  In fact, the SSI would allow you to monetize our memories.  For instance you could look at pictures and identify people presented as either a friend or an associate, and get paid for this, turning them into  a “data laborer.”   Or, if the SSI thing is truly thought out, there would be no reason why you couldn’t vote over the Internet.  Think of the participation rate if you could vote using your smart phone?  But the largest opportunity is that you could allow your SSI (which would essentially be an AI system) to become an executive assistant that can buy plane tickets or setup dinner reservations.

So, where are we now with this project?

Pilot projects are already being implemented.   The one we have the most information on is called MetaMUI.  It is an SSI system setup by an aboriginal group within Australia.  (Yeah, I had to look that one up myself too, no shame.)  The system allows members of the community to positively identify themselves when in the online environment, and the payment module (slowly coming online) allows the community members one single place to place all money, cryptocurrencies and other types of valuable assets.

A robust e-government system to digitize the entire government services, the MetaMUI SSID app can be employed by users to connect to other public entities such as banks, government organizations, shops, schools, etc, through Pairwise Trust authentication. Commercial sites that have a public identity on the MetaMUI identity blockchain can offer the Pairwise Trust login to their customers. The user no longer has to register the website and create an ID and password. Users can simply connect their SSID to the website through Pairwise Trust connection and login instantly. Users do not need to provide sensitive private information to every website they visit anymore. The MetaMUI SSID app provides seamless login capability without sacrificing private information. 

As exciting as this is, and it is, it is important to realize that this innovative product lives on one device at a time.   Most interesting is a future SSI system that will be interoperative with any device you happen to be on.   For instance, a personal story.   I was on a trip to Chicago when a job became open, but to get it, you had to take a test online.  If I had had  a portable SSI system, the IRS computer would have recognized my sign-on whether from my own smartphone or the hotel business center.  (And would have done so without any delay by asking verification questions.

The Verdict

SSI systems would go a long way to solving many problems related to the internet today.  The only thing that sticks in my craw is the authentication itself.  This whole discussion is wrapped around the idea of decentralized finance (DeFi) which suggests the unnecessary nature of intermediaries.   In its current  incarnation, in order for the SSI system to work, there MUST be a central authority to issue the SSI to begin with.  Perhaps in the future, somebody much smarter than myself will find a way around this issue, but for now, it appears to be quite intractable.  So, for right now, it seems to be a great thing to play around with the idea of, but, it doesn’t appear to be ready for Primetime.





Editor’s Note: Please note that the information contained herein is meant only for general education: This should not be construed as Tax Advice.   Personal attributes could make a material difference in the advice given, so, before taking action, please consult your tax advisor or CPA.

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