By: Etan Bernstein & the VNF Team
Kerri Lemoie PhD recently published a blog titled ‘Do we need blockchain for LERs? No.”
Velocity Network Foundation (VNF) respectfully disagrees.
VNF has elected to utilize Distributed Ledger Technology (DLT) because of the advantages it provides to solving the current-world problems we see in the global labor market.
The Vision of the Future We Agree On
I believe that Kerri and I, DCC and VNF share a common objective, the same values and a similar vision of the future world we want to move towards.
Individuals should have the right in a digital era to own and control all data about who they are, what they know, what skills they have, what licenses and certifications they have earned and much more. They should be able to keep this information private and share any selected portion of this information with any organization, anywhere in the world, for any purpose. They should not be dependent on the continuous existence or support of a school or past employer to prove their experience or education.
Individuals should not be tied to any vendor or specific technology. They should be able to consolidate all their digital information to one holder application (a.k.a wallet) and switch between wallets of choice whenever they want.
We are in 100% alignment that “digital education credentials like badges, micro-credentials, certifications, and even degrees could be stored, shared, verified, and used on the web in the same secure way as driver’s licenses and citizenship documents that are also issued as W3C VCs. The intention is for all of these credentials to be understandable and verified similarly so that they can be used together.” I would add to this list not only education credentials, but diverse types of work-related credentials such as work experience, licenses, performance reviews, assessments, recognitions, payroll data, benefits data, attendance data and even occupational health information.
Yet Kerri’s blog makes many assumptions about how digital credentials are used in real life situations and she thus comes to the erroneous conclusion that Distributed Ledger Technologies and Blockchains are not necessary. Let’s explore the facts.
DLT Provides Critical Capabilities Needed to Achieve the Vision
At VNF we choose to use DLT to bring our vision to life. There are critical requirements for a globally interoperable and trusted infrastructure supporting Verifiable Credentials (VCs) that are best addressed by leveraging DLT. These include:
- No Phone home: Ensure that credential metadata data is not hosted by issuers to prevent pixel tracking manipulations by issuers.
- Survivability: Prevent data loss in the case of closure including credential metadata and Issuers public keys.
- Trust & Security: Credential metadata can be checked to match governance rules upon issuance and verification.
- Rule consistency: Governance rules are implemented in contracts not individually by vendors
- Decentralization via community: The community comes together to review the contracts and runs them together as node operators.
- Metrics: Logs of pseudonymized issuing and verification events to generate network wide aggregated statistics.
Responding to the Concerns About Use of Blockchain with LERs
In her blog, Kerri provides the following 5 reasons for not using blockchain. Let’s dissect these one by one:
- “Blockchains are expensive and energy-sucky ways to store and verify credentials” – For the most part this is an outdated belief. Blockchains that use inefficient consensus mechanisms such as Proof of Work (made famous by Bitcoin) use a lot of energy and can be expensive, but almost all protocols either use a layer 2 protocol or blockchains and DLT ledgers that use much more efficient consensus mechanisms to make it both green and cheap. For example, Cheqd, EBSI and Velocity Network all use variants of Byzantine Fault Tolerant consensus algorithms that are already 100x-1000x more performant than Bitcoin and exponentially less power hungry.
- “It’s a headache to explain to and request public keys from credential recipients” – The Verifiable Credential ecosystem embraces the need for keys that are hosted on a variety of locations and are accessed via open standards protocols. Whether these keys are accessed from a blockchain or any other publicly available source is handled by the smart technology in wallets and agents that act on behalf of participants so that the end-users don’t have to worry about them.
- “Storing data on a blockchain (especially long-living ones like Bitcoin and Ethereum), even when hashed, is risky for PII (Personal Identifiable Information) and means that once it’s on a chain, it can’t be changed or removed. So, if any mistakes are made or data has changed, there’s no way to remove it.”- This assertion assumes that PII is stored on chain, which it is not the case. Velocity Network, Cheqd and EBSI are all examples of blockchain based Self Sovereign Identity (SSI) systems that do not have PII nor even PII hashes on-chain. At VNF we agree that PII should never be on chain, and the DLT should be used to anchor proof, issuer trust and certainly not individual data.
- “It can create a vendor lock for the issuer and the recipient. When the vendor/network goes away, where do those credentials go?” – Data on blockchains is public, immutable, distributed and can survive the loss of the vendor because a community is built around them, so the data is not locked-in. Common SSI solutions that promote the use of DID:WEB for documenting issuer keys, and W3C Status Lists stored on Issuer websites will result in credential metadata being lost when that issuer closes due to bankruptcy meaning the individual’s credentials become useless and never recoverable. Contrast that with blockchain-based designs of CHEQD, EBSI and Velocity Network where that metadata can never be lost. Credentials are far more resilient when using blockchain. Additionally, the topic of lock-in is actually a far greater threat around holder wallets which can trap user keys and credentials, and at Velocity Network are looking to engage with standards bodies to discuss how to make switching wallets as easy as switching mobile phone providers.
- “It doesn’t free data trapped in centralized silos. It creates new types of silos.” – The objective of using a blockchain is to free credentials from issuer control and instead to create public utility networks that guarantee privacy, resiliency and interoperability. Credentials do not phone home to check statuses ensuring holder privacy, credentials are resilient against issuer closure which is a clear and present danger for education and employment use cases, and the blockchain can enforce the same ecosystem governance rules. In the end all technology can be used to create silos, but the same accusation can be thrown at any singular proprietary API existing in any specific ecosystem.
In her blog, Kerri also raises a very important question about business models in a future Verifiable Credential world, and whether “Pay to Verify” models are required. This topic requires a separate blog posting that is now top of our agenda. I will just mention that VNF believes that the “original sin of the internet” as described by Marc Andreesen is the lack of a micro payment system which is the cause for the internet today being controlled by a few major vendors monetizing individual’s data. We all know the quote “If it’s free – you’re the product” and how the “free” internet has developed ad models and data monetization schemes which negatively impact privacy. It may be free but comes at a great cost. Despite all our desire to reestablish individual privacy, without creating an alternative on how businesses can monetize data, the internet will be doomed to continue to monetize by selling breaches of individual privacy. The Velocity Network incentive system aims to address this challenge.
Where Do We Go From Here? Focus on the Real Challenge Ahead
The real challenge we all face in bringing our joint vision to life is that of adoption. The impediments of adoption are closed proprietary systems not releasing data to individuals, data hoarders making millions of dollars on individuals’ data and organizations that are not moving forward to adopting the future because the investment is high, the barriers to entry are too prohibitive or they are confused about how to move forward. We all face these challenges, and we should all work together to focus on addressing them.
One of the reasons I love innovation and technology is the way things develop through dialogue, sharing ideas, learning from others, building on top of each other, continuously iterating and improving. There is seldom a perfect or “right” answer, more often a co-existence of multiple approaches, each with advantages and disadvantages, that work adversely or collaboratively to improve.
Let’s not fight, disengage or agree to disagree. Instead let’s engage in an ongoing productive dialogue to improve all solutions and accelerate the pace towards our joint vision.
Velocity Network Foundation is open to everyone and invites DCC to join and be active in our community and robust governance structure. If DCC is open to inviting VNF to participate and contribute to its work, we will gladly do so.
Who knows what marvelous things may come from such collaboration.