San Francisco Startup Distributed Systems Adopted by CoinBase for “Decentralized Identity Solutions”
In a post on the official Medium blog for CoinBase, the company officially announced their collaboration with Distributed Systems. They wrote,
“Distributed Systems is an incredibly thoughtful team that has been working on decentralized identity solutions. With their work on the Clear Protocol and GraphQL, Nikhil, Alex, and the rest of the team have gotten their hands dirty in the technical detail of using blockchains to improve how identities mesh with digital products. We believe decentralized identity systems represent a transformative shift in our relationship with technology, and we can’t wait to work on these opportunities together at Coinbase.”
Much of their annoucement starts off by describing their experience within the verification of identity through the years of many industries, which supports their need for this digital identity startup. Only a few decades ago, many people still remember a time without social media or email when the identity of a person was independent from a website. However, with the Internet and other advances, there are many people that hold an explicit level of information online, describing everything from their jobs to their possessions to their relationships with others.
One of the big appeals of cryptocurrency is the security of identifying information. Everything is preserved with a private key that can be personalized but cannot be replicated. There are smart contracts and storage wallets that enable consumers to make identification documents digitized, but safely stored under password protection, which is usually encrypted as well.
Blockchain was a major advancement for the technological industry, because it offered a chance to log information about transactions in a way that could not be tampered with. Once something is posted, it is there for good, leaving an honest account of anything that happens, for better or worse. Since CoinBase is all about innovation, that is where this partnership comes in.
Decentralizing online identities will transform our relationship with technology. Today we’re welcoming the Distributed Systems team to Coinbase to work on this opportunity.
— Coinbase (@coinbase) August 15, 2018
Distributed Systems was established as an effort to created “decentralized identity solutions.” The project is still small at only five members, so they will exist as a unit within CoinBase for now. B Byrne, the project manager for this effort, compared the security measures to that of giving out a social security number for verification purposes to a third party.
Byrne supported his stance, saying:
“Every time you want to prove who you are with your SSN, you need to give away a copy of it. That copy has exactly the same power as the original, so when there’s a data breach with copies of your data it puts your identity at risk. A decentralized identity will let you prove that you own an identity, or that you have a relationship with the Social Security Administration, without making a copy of that identity.”
It is not a far reach to suggest that this type of security and preservation of value can be done with images, social media posts, and even a license or passport, with the right advancements.
However, even with this new addition, CoinBase is being “deliberate” on how they want to integrate the technology, ensuring that the use benefits their clients, once implemented. As they figure it out, they will need to maintain the privacy and anonymity of their users, which will be expanded upon as they learn more about Distributed Systems technology.