Everything Will Be Tokenized: The Future of Identity

What I'd like to talk about is what, what is the future of identity? The idea that everything will be tokenized and, and what do we mean by that? If we step back and, and, and just look at it through the lens of Miko, the, the company that I founded some years ago, we started out with this vision to enable everyone to get equity and value in exchange for the data they share, the information they share, the way that there is some sort of digital exchange. Why? Because we imagined that in the not too distant future, everything would be tokenized.

In other words, everything would be able to be uniquely identified and maybe required in some kind of digital handshake or some kind of handoff either to authenticate or authorize or provide access or all of those things simultaneously. And one of the things that we are hopeful of is this opportunity. And if we get this right, and we design this right for a more equitable value creation at the moment, we know that there is a lot of asymmetry in terms of the way information is, is exchanged, how our identities are used.

We know that that power often doesn't rest with the citizen, the patient, the student, the, the employee, the passenger, the customer, we recognize that often that power or that, or that asymmetry is there as a means of trying to provide greater trust or control. But the opportunity is for us to maybe make this a living a more level playing field. And I mentioned the word truth. Why does that matter?

Because at the, one of the challenges for where we find ourselves right now is that we are living in this post-truth world, because just because we can see something, just because we can hear it just because we speak, it doesn't necessarily mean it's true. I, I read an article earlier this week. I hope I'm quoting it correctly, but I think that, that you only need something like 3.5 second sample of someone's voice to be able then to manipulate that voice, to say, or construct a narrative that is actually not original.

So one of the things that we, we need to be able to do is very quickly be able to trust, issue, prove store, track, trace, and revoke, or, or run through that list of things very, very quickly. Because the other thing that, that everyone is expecting is a great user experience or for connected experiences or personalized experiences. And so the, the focus for us, especially over this last year has been, how do you bring these different components together and, and have that baseline of trust.

And one of the things that we think is critical is that is getting this infrastructure for people in their digital twins, right? So why is that important? And particularly as we look to the future generation, just take a few moments to answer this in, in, in your own mind. So in 20 20, 1 of the popular platforms sold 1.2 billion worth of virtual currency. So which of this group do you think makes up more than 50% of the purchasing decision of this user base? This is 1.2 billion us dollars. Is it children under 13? Is it children over 13 or adults?

So why this is so important is this is kids under 13. So we have a whole generation that is growing up in a digital virtual currency type world that actually understands micropayments or token payments or digital currency. And so this is a generation that is used to doing things within the context of a game or in the context of a virtual world who will then start to expect those kinds of experiences in the real world. And that may be with the services they trust. It could be their bank, it could be their insurance company, it could be the airline.

So this is a, a series of slides borrowed from Canara where one of the vectors that we know that we, we had to always secure was the perimeter around employees. We know that that then moved out for employees and partners to collaborate. Then we wanted to bring customers in. And so this we're moving to this perimeter, less environment Federation cloud.

Then we wanted to add things and now where we're at, and that back to the, the quote that I borrow from, from Martin and his presentation earlier today is we're in this much more complex world of relationships where this is all about attributes context in this stateless world. So one of the questions that we've been challenging ourselves on at Miko is how do we bring this down into a digital experience?

And, and how do we enable the individual that you and I customer patient student employee to participate more equitably in the value chain and, and be more active in the way that data and information is, is used for hopefully a much better outcome, a better digital experience. So we've been working on wallet technology using open ID w three C standards. And we've been focusing on how to incentivize the collaboration between multiple stakeholders whilst maximizing privacy. And whilst that's an easy thing to say that comes with a number of challenges, which I I'll share with you.

A few case studies, we've also been looking at using open ID connect because it is something that is familiar and adopted in enterprise. And one of the focus for us is how can we build this bridge and capability between the existing enterprise world, either trust anchors or the types of organizations that we deal with every day bank, telco government, and the emerging decentralized world, where we want to put more of that power or choice or control back in the hands of individuals.

So our focus has been around this multipurpose decentralized experience that can actually also work to connect into, through a federated experience and back into an enterprise user journey. So we've been focused on decentralized identity, micropayments, supporting tokens and Verifi, verifiable credentials, but also managing consent that transparency is there. So I have two use cases that I, I would like to share with you, and these are connected because it's, it's part of a collaboration between F in Australia.

And, and I'll give you a little background on FPOS and Hadera hash graph and, and Meco. So the first is FPOS Australia is Australia's go-to payment system, and it has been since the early eighties, it processed over 2 billion debit card transactions last year worth more than an average of 300 million each day. And FPO recently joined the Hadera governing council and made a decision to really forge ahead with some really groundbreaking use cases in the payments and identity space.

And so after successfully conducting some tests to determine feasibility of a digital Australian dollar stable coin for micropayments F POS looked at how that could be enabled together with Hadera. And so the idea was how can we have the convenience and the experience of a debit card that people are used to every day to be able to access things like small pieces of content in a micro transaction that could be feasible for a merchant from a merchant fees perspective could be linked to a stable coin.

So that actually we are, we don't have to have the complexity of helping a customer understand everything that happens in the crypto world, but we could have the same stability, security familiarity by doing that via a stable coin. And how could we make sure that it was identity preserving and support attribute based credentials at the same time?

So for instance, I wanna, I wanna access certain content, but I might ha may have to, to prove my age, or I may have to prove something in terms of being eligible, but, but most importantly, and what's so exciting about doing this work together with Hadera hash graph, is that the feasibility, this is a combination of breakthroughs from a technology point of view, from a commercial point of view, and from a legal point of view. And one of the, one of the difficulties is the cost of doing small transactions.

Sometimes the cost of doing a small transaction can be prohibitive, and then being able to do this together with Hadera meant that those merchant fees could be a small percentage of the transaction, which now opens up the opportunity to be able to buy things like music or, or content on, on a, on a, a per content basis. So why Hadera, so here's five really important reasons why, why Hadera offered the ability to support this move into micropayment.

Stablecoin first of all, the speed of the network that it's fair, secure, and stable, but also I'd like to call out one of the other considerations as enterprise and government are starting to think about moving to decentralized technologies is also the environmental impact. So it's the combination of all of these things that start to bring scale speed, security, and environmental factors together to enable some of these new use cases.

And, and we're very proud to be part of this ecosystem and enabling the wallet to be able to support things like tokens, verified, credentials, identity micropayments, but whilst that is really fantastic. And, and we're very happy with, with, with the outcome of the, that proof of technology and the convenience factor and all the great things. We also recognize as we move into this, everything all the time world, that there is some responsibilities that come with that. And so this is one of my favorite quotes. When you invent the ship, you also invent the ship wreck.

So that, that suggests this idea of what's the ethical responsibility that you have when you design a use case. It's not just about the technology. And here's a, a great example. And if I was to quote, Rob Allen from F OS, who's the entrepreneur in residents that, that led the micropayments project, you know, what would happen if you could incentivize the drivers in front of you with a micropayment to move out of the way, because you are running late, that might sound like a super cool use case. It might sound like it's the, you know, science fiction.

But in fact, in the last year, Audi announced its vehicle to infrastructure communications layer. So it could start to anticipate traffic acceleration stopping. So when we start to hook up all of these things, what happens when you start to actually add in an incentive layer or, or a payments layer?

Okay, that's a great use case. Let's flip that now from an ethics point of view, and look at, if you haven't thought about how you design this from a privacy and control perspective, this was 2019 before COVID China banned 23 million citizens from buying travel tickets as part of their social credit scoring system. So we recognize that whilst we're focusing on this convenience and ease, and there is multipurpose experiences, there is also this importance to be thinking about how do we design these things and what are the unintended consequences of applying these new technologies?

And one of our perspectives in terms of thinking about the convenience, the governance and the privacy is to think about how we may actually start to build up sort of a multi ledger experience in life, life, moving between ledgers and networks or ecosystems. So we imagine a private ledger or a digital twin that really is it's important that that remains always under the control of the individual or, or the, or the guardian, because this is really a shadow, a digital shadow of who we are and what we are doing.

We then may find ourselves operating in a permission network because the service provider is extending a service. And the important thing about that network is trust. And we may even find that that permission network may have either a governance or consensus mechanism that is public, so that we can start to very, very quickly establish that trust or, or a token or, or, or an indication that this person thing experience is authenticated authorized and, and can have access to complete whatever it is in the digital journey.

So some of the challenges that come with this ID is now more personal than ever this fusion of the digital with our biometrics, the issue of progressive disclosure is becoming more and more important. And it's hard things to design for because you could find that right moment to serve up why you're asking for something and making people understand why, why they need to make a choice, which then links into consent. And one of the rules that we use constantly around the consent mechanism is how can you focus on minimum collection, the maximum value?

What's the minimum thing I need to ask for in this moment that is going to provide the maximum value. How do I make sure that I'm not over collecting anything? And how can I separate that disclosure out over the whole journey so that it's not all of everything at once, and I'm either compromising privacy or the possibility of that information, that data, that biometric being used out of context. The other thing, when we start to look at networks is how critical it is. The commercial models need to incentivize everyone.

And I think this is one of the biggest shifts in starting to look at new business models is the importance that all actors need to be incentivized. All actors need to be incentivized rather than the current environment that we have. And we see, this is one of the issues that we have with social networks or current business models, or the complaints around the surveillance economy is that it's kind of a winner takes all.

And so what we need to be able to say is there are small incremental incentives for each of the actors to work together, and that if you need that, then you also need to build in treasury fast settlement. That is, that is transparent. So there's no point building in reward mechanisms or incentive mechanisms, if there's then a delay in those mechanisms being delivered. So that also means that governance has to be there in order for treasury and settlement. You need to able to prove a audit, transparency, responsiveness, and accountability. There has to be some kind of traceability.

And one of the challenges that we know for all of those under 13 year olds that are spending so much of their time inside games and the tokenized world of how they exchange value is that we haven't quite worked out yet the, the balance between keys and convenience when it comes to managing cryptographic keys. So this idea of recovery, trusted brokers, escrow services, backup services, is gonna be critical.

And I think, I think the, the challenge for all of our, as, as practitioners is how do we start to enable young people to understand the value of their digital keys in the way that maybe many of us understood that with getting, you know, a physical key to the home for the first time. So wrapping up our focus over this last 18 months of COVID, we've been head down and tail up, looking at the building blocks to bring this bridge between these two worlds together.

So starting out with, with our kind of foundation capability, our, our digital vault starting now to bring in this key management so that we can manage this orchestration between where individuals are able to store data documents, information, provide consent. Now, what we see is we are marrying together enterprise capability with a decentralized world. We need to have this secure value exchange. We need a brokerage service that enables either managing the avoidance of phoning home, or being able to phone a trust anchor for verification, if that is relevant into the use case.

So being able to look on a case by case basis, how we orchestrate this and how we are able to enable credentials or data to be requested and fulfilled, and also importantly, how we revoke and then last but not least, how do we then enable that by putting a decentralized wallet into the hands of customers, patients, students, employees, to be able to move in and out of the decentralized world and, and, and working together with enterprise or service providers in a, in a trusted way, no point doing that without making those tools available.

So the focus for us is documenting that use cases, enabling developers. I mean, one of the things that we pride ourselves on is a team of developers, developing things for developers, and what we see more and more now is enterprise needing to find the way to offer greater power, greater control, greater choice to their external stakeholders users. And at the same time, realize that they have responsibilities in terms of maintaining that trust and, and making sure that services can be delivered in a way that are secure, that that we're managing fraud.

And that we can find that balance between convenience and, and I would say the new factor that we're focusing on from a commercial point of view from a technical point of view is this incentivizing, how do we make sure all actors have a reason to collaborate, to make those experiences better, more secure, faster, more personal. So that's it that's that that is a whirlwind of some of the things that we've been doing together over the last 18 months.

I'd encourage you to read more around what FPOS has been doing in the micropayments area and what Hadera is doing in conjunction with many of their partners around the world. We're really excited with what is coming together with this type of technology. And what's possible as we move into a world where we think everything is going to be tokenized.