Shyft Network- Solving The Internet’s Identity Problem
From early ID management systems to the birth of Blockchain, learn how Shyft Network is building the most secure future for trust and identity.
Identity has been a contentious point for humanity ever since we evolved societies. How are we sure that someone is who they say they are? Before the modern age, there were several ways ancient civilizations did identity verification. Unfortunately, the scope and viability of those methods went out the window during the information age — and even more so during the dawn of the internet, as human interaction started to become replaced by digital connection. The internet’s identity and trust problems weren’t much of an issue when it first saw use. Most people would use phone lines to dial into bulletin board systems. Phone lines were linked to addresses, which were tied to people living in the house. If someone had enough patience, they could locate who was dialing into their BBS. However, the internet has evolved since then, to put it lightly, and its identity problems have kept pace with it.
The Story of Trust Online
As more casual users started to take advantage of the internet with Web1.0, individual data would have to be batched out. As the rise of personal experience websites came onto the scene, the back end needed to know which user data it should show to the person sitting at the screen. Developers solved this by constructing credential systems. Usernames and passwords would be stored on databases (sometimes encrypted) and were handy enough to be carried across ecosystems. Unfortunately, when you have a centralized database of usernames and passwords, the attack vectors for obtaining access to them are trivial. In the early days of login authentication, many young users tested their skills attempting to break into these Web1.0 databases, and many succeeded.
These early, clunky user-password authentication efforts evolved into ID management systems run by large corporations with the rise of Web2.0. Now, users can log in with a single click, using the API to share their login verification with whatever website requests it. This approach made it easier for developers to onboard users since it had much less friction than forcing them to sign up for a new account. Users today have several dozen accounts already on sites they might only use once. The obvious drawback of this system is that you can be banned or restricted if you go against the data holders. As an added bonus, these companies routinely sell the data they collect from users to third parties for all sorts of purposes, usually without the user being aware of it. While we’d like to think these massive corporations are secure, the sheer amount of data leaks coming from businesses like Facebook shows that this is a vain hope.
The Evolution of Blockchain Trust
In 2008, Satoshi Nakamoto created Bitcoin intending to develop a trustless ecosystem for financial transactions. In essence, the Bitcoin blockchain is a conversation between two parties. The recipient asks, “Do you have the BTC I requested?” and the sender replies with a yes or a no, backed up by the blockchain’s record of their currently accessible funds. Bitcoin has its own problems, but the principle of a trustless network is sound, as has been evidenced by the widespread adoption of the world’s first cryptocurrency. Shyft Network seeks to take what Bitcoin developed and evolve it to the next level. But how do we intend to do that?
Shyft Into High Gear
A blockchain can bring about tangible change in the world. Shyft Network is doing so by providing users and third parties with a single decentralized method of verifying credentials. The Shyft ecosystem involves several stakeholders, each with their part to play.
Ø The Data Owners and Data Holders: Data owners are individuals or organizations that credentials refer to. They may or may not be trusted entities, but they can interact with Trust Anchors (Data Holders) to verify their identity or the validity of the data. In fact, any data can be contextualized via attestations and TAs.
Ø Trust Anchors (Attestors): These are trusted entities that collect data from issuers and holders. They verify the identities of these individuals or organizations and hold the data off-chain. If the data owner would like to pass that data to a third party, they wouldn’t need to pay a fee for transferring that validated data. However, third-parties, such as aggregators could potentially pay for that data before the data-owner’s consent.
Ø Data Consumers: These entities provide pre-approved app services which utilize trusted data. They’re responsible for requesting data from holders, reviewing attestations, and determining whether that data is usable.
Ø Validators (Nodes): Nodes perform much of the same work as on other blockchains — they validate the transactions and add them to the chain.
Ø Consent Framework: Today’s users have become used to companies hiding privacy data inside their setting’s menus. Shyft Network operates on a strict opt-in system that allows users to control who gets their data.
Ø Proof of Individual: How do you know that the sender probably has what they’re offering? With the Shyft Network, it’s a simple matter of verifying the blockchain address. With all data pertaining to an individual linked to this address, it’s impossible to spoof identities.
Reliability and Dependability
The Shyft Network aims to provide a method for users to share data with the companies they see fit. As an opt-in system, the data holder can deal with each request for their data individually. However, the Shyft Network offers more than just a method of verifying users. Some of the most current use cases have demonstrated the flexibility of the platform.
Ø Financial Action Task Force (FATF) Travel Rule Compliance: The FATF recently issued crypto-specific guidance recommending jurisdictions to require Virtual Asset Service Providers (or VASPs), (such as cryptocurrency exchanges) to provide sender and recipient data on request. Yet, at current, there exists no way to comply with the FATF guidance. By partnering with some of the world’s most trusted cryptocurrency exchanges, like Binance and Tether, the Shyft Network has helped design and implement a solution to this problem.
Ø Compliant Decentralized Finance: De-Fi has had regulators up in arms, trying to lock down much of the innovation within the space. Large liquidity providers, for example, cannot interact with the De-Fi space because of a lack of clarity from regulators’ perspectives. Shyft Network is a decentralized solution that considers these outdated or obsolete perspectives that regulators may have and combines it with a way for liquidity providers to verify themselves in a way that complies with the regulations.
Ø Government Digital Identity: Identity fraud is a real danger, but with a trustless verification system like Shyft, a seamless, single verification is all that any citizen or organization within a country needs. Through Shyft, governments have a platform to create Know-Your-Customer (KYC) systems that are seamless to interact with and provide easy verification for all users. With this seamless verification comes security, interoperability, and transparency. Data collected would be readily available to regulators and auditors within the confines of privacy rules.
All of these use cases only scratch the surface of what Shyft is capable of, especially as we roll out open-sourcing of Veriscope, our latest and great DeFi compliance framework and smart-contract platform for VASPs to enable travel rule compliance. While we already have an idea of what can be done with our growing infrastructure, we’re excited to see how the evolution of the blockchain will bring about new and innovative approaches to personal verification within cyberspace. Stay tuned.
Shyft Network aggregates trust and contextualizes data to build an authentic reputation, identity, and creditability framework for individuals and enterprises.
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