Microsoft Previews Blockchain-Based Decentralised ID System


The ION network would use Bitcoin’s blockchain for identity assurance, while creating a secondary network to vastly speed up processing chores

Microsoft has announced it is building a decentralised identity (DID) network on the Bitcoin blockchain, in an early-stage project in which it is looking to enlist the efforts of “experienced” open source developers.

The company said its Identity Overlay Network (ION) is based on evolving open standards developed in cooperation with the Decentralised Identity Foundation.

Such networks are intended to allow users to sign into a variety of online services, much as they can with a Google or Facebook password today, but without the system being controlled by any single organisation.

“We believe every person needs a decentralised, digital identity they own and control, backed by self-owned identifiers that enable secure, privacy preserving interactions,” Microsoft said in a blog post.

‘Self-owned identity’

“This self-owned identity must seamlessly integrate into their lives and put them at the centre of everything they do in the digital world.”

ION introduces an architecture intended to deal with technical limitations that mean the Bitcoin distributed ledger, or blockchain, can only process tens of transactions per second.

It offloads most processing tasks to a secondary network based on a newly developed protocol called Sidetree, with the Bitcoin blockchain used as a trust anchor mechanism and decentralised storage provided by the InterPlanetary File System (IPFS).

The approach allows ION to achieve tens of thousands of operations per second.

Microsoft wants to ultimately create a system where “billions of people and countless devices can securely interact over an interoperable system built on standards and open-source components”, said Daniel Buchner, a programme manager for the Microsoft Identity team.

Open source

He said Microsoft would work with open source contributors and others to prepare for a public launch of ION on Bitcoin’s main network “in the coming months”.

He said the code is currently best suited for “experienced developers”, but that Microsoft has deployed an early preview build of ION on its Azure cloud service for anyone who wants to interact with an ION node.

Earlier this month Microsoft a fully managed cloud service for blockchain networks, in a move it said was aimed at companies building business applications on top of the distributed ledger technology.

The company also launched an extension to Visual Studio Code to help developers create Ethereum-based smart contracts, compile them and deploy them on the public chain or on a consortium network.

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