Blockchain Identification: Good, Bad or Terrible?

“What do you think about initiatives seeking to secure people’s identities and personal information using the blockchain? These will allow users to only reveal individual pieces of information to different providers. Will that solve anything, though? Won’t banks still require that people provide all of the same information in order to open a checking account?”

“Are there any digital identity solutions using blockchains, which someone who lives in a village without a passport or utility bill can use to fulfill ‘Know Your Customer’ [or other] identity requirements?”

Andreas Antonopoulos shares his views on the idea of Blockchain Identification

“Digital identity is a hot topic in the blockchain space. I am extremely skeptical that you can solve problems of identity simply by throwing a magic blockchain at it. The problem here is not the identity itself. It is the fact that centralized, regulated institutions require identity for things that don’t need an identity to do. We use identity to control for fraud and risk in ways that don’t actually control or protect against fraud.

The fact that you have identification doesn’t mean that you are trustworthy or that you have good behavior. The fact that you behaved well in the past doesn’t mean that you will always behave well in the future. The world’s worst criminals were completely innocent before they committed their first crimes. All the historical information we had on heinous criminals would show that they were great people, up until the point when they were no longer great people. People change. Bad people have identification. You don’t need to be “good” to get identification. Identification doesn’t make you a good person. The controllers and purveyors of identification, states and banks etc, don’t have great insight into whether people are “good” or “bad.”

A society where everyone has an ID

In our society, we have assumed that if you are identified, you are a good person, or if you are identified and not good, we can chase you down and impose punishments. Both of those assumptions have resulted in the exclusion of several billion people from the financial system because they don’t have any identification while being inclusive to several hundreds of thousands of criminals that have both identification and banking licenses.

If you create a system like that, those who can issue identification documents become criminals due to corruption. Eventually, those who have control over people’s identification become the biggest criminals of them all. Do we need identification to transact? For thousands of years, we transacted with various forms of cash, the original peer-to-peer money, without any form of identification.

The idea that everyone needs to be identified before they transact is relatively recent. It is a toxic, fascist idea that has resulted in poverty and economic exclusion for billions of people. It hasn’t actually reduced fraud or allowed governments to stop crime and terrorism. It just ensures that the only people who can commit massive crimes against millions of people are those who are funded and supported by governments; that is all it does.

So is it Good or Bad?

Blockchain identification? Very skeptical. I don’t think it is even necessary for most things. I don’t think it helps people, solves or reduces crime in any meaningful way. I think the side effect of mass poverty, that a requirement of identification creates, is much bigger than the small benefit you might have in some areas of fraud prevention.

Massive human suffering for very little results. Of course, any time I have this conversation with anyone, especially in government as fans of identification, they will tell you, “If only we had more control over people, then finally crime will be eradicated.” It is always just a bit more power, more identification, more control for them, with biometrics and iris scans, etc.

That is the path to fascism. No, I do not want to do blockchain identification. I want to do anonymous cryptocurrencies. I think transacting with peer-to-peer, anonymous cryptocurrency is better. For many of the services we have today, the world would be a better place if we recognized that it is much better to give people the freedom to transact, to interact with each other, without forcing them to use regulated intermediaries, like banks, that impose these controls and policies. It gives those intermediaries enormous power with very little benefit for humanity. On that political rant, I think we are done.”

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