WhitePaperInclusiveDeploymentofBlockchainforSupplyChainsPart2–TrustworthyverificationofdigitalidentitiesApril2019WorldEconomicForum91-93routedelaCapiteCH-1223Cologny/GenevaSwitzerlandTel.:+41(0)228691212Fax:+41(0)227862744Email:contact@weforum.org©2019WorldEconomicForum.Allrightsreserved.Nopartofthispublicationmaybereproducedortransmittedinanyformorbyanymeans,includingphotocopyingandrecording,orbyanyinformationstorageandretrievalsystem.ThiswhitepaperhasbeenpublishedbytheWorldEconomicForumasacontributiontoaproject,insightareaorinteraction.Thefindings,interpretationsandconclusionsexpressedhereinareare-sultofacollaborativeprocessfacilitatedandendorsedbytheWorldEconomicForum,butwhoseresultsdonotnecessarilyrepresenttheviewsoftheWorldEconomicForum,northeentiretyofitsMembers,Partnersorotherstakeholders.3InclusiveDeploymentofBlockchainforSupplyChains:Part2–TrustworthyverificationofdigitalidentitiesPrefaceIntroductionTrustworthyidentityverificationinglobalsupplychainsWhythisisimportant:thedigitalidentitylandscapeWhatisadigitalidentity?ChoosingbetweenthreearchetypesCentralizedFederatedDecentralizedHowtodeterminetheappropriatearchetypeRegulatoryandlegalconsiderationsDesigningidentitysystemsforfuturesupplychainsIdentitysystemprinciplesforfuturesupplychainsProposeddigitalidentitymodelforfuturesupplychainsTrustbetweengovernmentsTrustbetweenbusinessandgovernmentsTrustbetweenbusinessesNextstepsAppendix1:WorkingsofadecentralizedidentitymodelVerifiablecredentialsindecentralizedidentitiesIdentifyingalegalentityGlossaryContributorsEndnotes5677810101011131415151516192021222324252728Contents4InclusiveDeploymentofBlockchainforSupplyChains:Part2–Trustworthyverificationofdigitalidentities5InclusiveDeploymentofBlockchainforSupplyChains:Part2–TrustworthyverificationofdigitalidentitiesPrefaceSupplychainsarebecomingincreasinglydigital.Acentralrequirementofthesedigitalbusinessnetworksistheabilitytoeffectivelymakeuseofpartnersinatrustworthyway.Assuch,organizationsneedacomprehensivesystemfortheverificationandmanagementofdigitalbusinessidentitiesthatisbothdynamicandtrustworthy.Despiterecentimprovementsindigitalidentityverificationsystems,theyneedfurtherdevelopmenttosupportthesupplychainsofthefuture.Newdemandsonthedigitalidentitiesoflegalentitiesandpossibilitiesforsupply-chainorganizationswilllikelybeusheredinbytheFourthIndustrialRevolution–withshiftsenabledbytheinternetofthings(IoT),artificialintelligence(AI)and,inparticular,distributedledgertechnology.Thepaceofdevelopmentisfasterthaneverbefore,anddecision-makersneedtore-evaluatethesystemstheyhaveinplacetomanagedigitalidentities.ThispaperadvancestwotopicsidentifiedbytheWorldEconomicForum:1.Thisisthesecondwhitepaperinaseriesandpartofabroaderprojectfocusedontheco-creationofnewtoolsandframeworkstoshapethedeploymentofdistributedledgertechnologyinsupplychainstowardsinteroperability,integrityandinclusivity.TheWorldEconomicForum’sCentrefortheFourthIndustrialRevolutionisworkingwithamultistakeholdergrouptoproduceaprojectthatincludes:–Aseriesofwhitepaperspublishedin2019.Collectivelyandindividually,thesepaperswillofferinsightsintoandexplorationsofspecificconsiderationsfordecision-makersinharnessingblockchaintechnologyeffectively.–Aconcise,easy-to-usetoolkittobereleasedattheendof2019coveringimportanttopicsforsupply-chaindecision-makerstoconsiderforresponsibleblockchaindeployment.2.Itcontributestotheongoingdevelopmentofunderstandingaboutandthedeploymentof“gooddigitalidentities”fortheFourthIndustrialRevolution.Asdigitalbusinessinteractionsflowacrossbordersininternationalsupplychains,therewillbemanycasesinwhichpartiesdonotknoweachotherbeforetheyconductbusinesstogether.Itisourhopethatthefollowingoverviewoftheopportunities,risksandsomesuggestednextstepswillstimulatestakeholderstoembarkonanewandexcitingactionagendatobuilddigitalidentitysystemsthatarepreparedforfuturesupplychains.DerekO’Halloran,Head,FutureofDigitalEconomyandSociety,MemberoftheExecutiveCommitteeManjuGeorge,HeadofPlatformServicesandPublic-PrivateCooperationNadiaHewett,ProjectLead,BlockchainandDistributedLedgerTechnology6InclusiveDeploymentofBlockchainforSupplyChains:Part2–TrustworthyverificationofdigitalidentitiesIntroductionDigitalidentityensuresintegrityinconnectingthephysicalandthedigitalworld.Inglobaldigitalsupply-chaintransactions,itisessentialforalegalentitytoproveitsownidentityandcheckthoseofotherparties,eachofwhichrequiresaunique,verifiableandauthenticdigitalidentity.Whilethispapercanbereadalone,itdoesnotintroducebasicblockchainconcepts.ThisiscoveredbythefirstWorldEconomicForumwhitepaperinthisseries–forfurtherreferenceseeInclusiveDeploymentofBlockchainforSupplyChains:Part1–introduction,April2019.Thefirstwhitepapercoverstopicssuchasbasicblockchainconcepts,blockchainfeaturesthatareattractiveforsupply-chainsolutionsandthefindingsonconcernsthatsupply-chainactorshaveforthedeploymentofblockchaintechnology,includingaconcernovertrustworthydigitalidentitymanagementthatgaverisetothispaper.Thiswhitepaperthereforeexploresconsiderat