Self-Sovereign Identity (SSI)
Overview
Self-Sovereign Identity (SSI) is a decentralized digital identity model where individuals control and manage their identity without relying on centralized authorities. It leverages blockchain, cryptographic proofs, and verifiable credentials to let users selectively share information with service providers.SSI promises greater privacy, portability, and user control while reducing dependency on government databases or intermediaries. For compliance, SSI can streamline KYC processes by allowing institutions to trust cryptographically signed claims without handling excess personal data. However, regulators are still defining frameworks for SSI adoption to ensure reliability and accountability. Banks, fintechs, and digital platforms are exploring SSI to balance security, user empowerment, and compliance obligations.
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FAQ
What is SSI?
A digital identity model where individuals own and control their credentials.
Why is it important?
It enhances privacy and reduces reliance on centralized databases.
How is it used in compliance?
Institutions accept verifiable credentials to satisfy KYC while minimizing data storage.
What are its challenges?
Interoperability, regulatory acceptance, and ecosystem maturity.