The use of Blockchain security features to secure your personal information will greatly reduce the risk of identity theft.
Opening a new bank account, applying for a job, leasing an apartment and even getting a library card can be a hassle: you have to bring countless identity cards and other supporting documents. Know Your Customer (KYC) regulations can be burdensome, but they are in place to combat money laundering or other criminal activity. With massive data breaches occurring several times a year, customers are concerned that their information may not be safe. Fortunately, Blockchain security features may be able to secure customer data while ensuring the validity of the customer’s identity.Customers Have Reason to Be Concerned About Identity TheftAccording to a report published by the US Department of Justice, 17.6 million Americans experience identity theft each year. Identity theft is usually the result of a data breach where hackers get access to names, addresses, birthdays and social security numbers. With this information, criminals are able to open fraudulent credit card accounts.
We need a mechanism that validates an individual’s identity without sharing personal information. A blockchain-based identity management system ensures that companies aren’t storing an individual’s personal information, rather they are referring to the blockchain via an encrypted public key. The individual manages who has access to their information, what information can be accessed and for what purposes. The blockchain-based identity management system accomplishes the same goals as the EU’s General Data Protection Regulations. At the same time, companies can comply with Know Your Customer (KYC) regulations.As powerful as blockchain security is, it doesn’t address every challenge regarding online identity management. There is still the question of who initially verifies an individual’s identity and how do you ensure the integrity of the verifier. A single verifier, such as a government database, defeats the security of a decentralized system, while multiple verifiers reinstates the original problem.However, once the individual’s identity is verified, blockchain-based identity management keeps your information safe and speeds up the Know Your Customer (KYC) process.
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