Connect with us

Market Analysis

Ontology’s Jun Li on blockchain-based digital ID – Cointelegraph Magazine



“Everyone’s car generates a lot of data every day,” factors out Jun Li, founding father of the open-source digital id blockchain Ontology.

The automotive sector is one through which his firm’s ID answer has a transparent use case, as every driver’s information might be saved and used to calculate insurance coverage premiums based on precise driving conduct.

“Some insurance companies will put telemetry devices on the cars to collect your driving information. Every year, your insurance pricing will be based on your behavior data.”

For Li, this can be a constructive improvement as a result of good drivers will obtain well-earned reductions on their insurance coverage funds. However what if somebody doesn’t need an insurance coverage firm to entry their driving data?

“They can decide what kind of data they want to share with whom,” Li explains, including that “This meets the legal requirements for privacy and data protection.” So, privateness stays beneath the motive force’s management… however at what worth?

“If you want to protect your privacy, you can use this way: ‘I don’t want to share data, I am willing to pay a higher price,’ so it’s everyone’s choice.” Li proclaims, explaining that with no provable, established status, no reductions might be supplied.

It appears as if privateness is turning into a premium good. Developments like these are scary to many, however Li anticipates most individuals being comfortable to half with all forms of information if they will get advantages in return. “A user will realize that data becomes a real asset. All data has value — even direct monetary value.”

In a single sense, there’s nothing fairly new to this, as insurance coverage firms have lengthy primarily based premiums on info resembling age and gender, that are seen to foretell driving conduct. A minimum of this answer would base the premiums on precise conduct.

Li’s bigger imaginative and prescient is of a globally appropriate digital ID that may join a person with all the information they generate and permit them to go it on to whomever they select. That is similar to privateness settings on social media websites, minus the necessity to belief the social media firm itself. Within the new age, industries like decentralized finance, or DeFi, might function with credit score scores, and ID might be related to instructional achievements and even vaccination data. “You can use blockchain to link to different data sources related to identity,” he says.

Li isn’t working to finish anonymity per se, relatively to assist align pursuits in order that on a regular basis actuality can higher combine right into a decentralized world the place people have extra management over their information.

“I don’t want to define us as a revolution. We want to change the link to the traditional world to make things better and better. Not just ‘okay, break everything and rebuild everything’.”

Traditionalizing DeFi

The Wild West is a standard characterization of the cryptocurrency atmosphere — a brand new territory the place everyone seems to be a newcomer with no earlier status and persons are thus thought-about untrustworthy by default. Right here, the one forex is chilly onerous (crypto) money. Within the previous world, status and belief are maybe the best of currencies. The query is how these two worlds will work together going ahead: Will they separate fully or merge?

Li is betting on a merger of worlds, believing that real-world identities nonetheless maintain worth. Whereas centralized finance and DeFi gamers like Celcius and Aave supply varied options for borrowing, these stay reliant on the borrower placing up ample safety.

Because the options supplied by the DeFi business mature and vie to draw extra of the worldwide lots, a shift towards providers which might be extra acquainted to the common individual is maybe inevitable. This might imply the tip of repetitive Know Your Buyer procedures.

Jun sees Ethereum because the dominant chain going ahead however believes there’s a necessity for not less than a few others, together with a blockchain for digital ID, which is Ontology.

Alternatives await

When Li started his research on the College of Shanghai within the mid-2000s, he selected pc science as a result of “The internet was just coming out” in China and the diploma supplied the onerous abilities that made it straightforward to discover a job within the nation’s rising expertise sector. He initially labored as a programmer with varied Chinese language companies however quickly moved as much as handle IT technique on behalf of main enterprises, resembling Infosys in 2010. He expanded his horizons by learning in Manchester, London and Hong Kong, including grasp’s levels in each science and enterprise administration by 2014.

With a contemporary MBA in hand, he took on a publish with China’s first futures trade, the China Monetary Futures Alternate, the place he laid monetary frameworks for the rising Chinese language economic system, together with “exchange products, sentiment products, design and architecture.”

Six years in the past, whereas main an innovation crew charged with researching new applied sciences like large information and synthetic intelligence, he realized there was extra to blockchain than meets the attention. Blockchain, he discovered, is “incomparable to other IT-technologies.”

“I realized that blockchain is not only a kind of financial technology. It is a kind of mechanism that allows people to cooperate based on a no-trust mechanism,” he explains.

“I thought ‘okay this is a very interesting technology, I should put then all my time to it’, so I quit my job.”

He promptly co-founded OnChain, a supplier of open-source blockchain options for the Chinese language market, in 2016.

The system architect decided that the digital world being constructed by the worldwide blockchain business lacked interconnectivity as a result of its largely pseudonymous nature. “We need to build a bridge from the traditional world into the world of decentralized identity,” he concluded, explaining {that a} digital ID might hyperlink blockchain accounts to actual individuals. Two years later, he based Ontology to carry this imaginative and prescient to life.

The nice balancing act

Knowledge is usually known as the brand new oil. All method of firms harvest varied forms of consumer information for revenue with out permitting the customers themselves any technique of benefiting straight from the information they offer up. A lot of this info assortment takes place with out the data of the end-user, and the mere use of a product usually implies the acceptance of a phrases of service that makes it clear that the information in query by no means belonged to the consumer in any respect.

For an individual who values privateness and anonymity, the trendy actuality of surveillance capitalism is a power to be reckoned with. Participation is successfully obligatory, lest one turn out to be a real hermit. Even when one isn’t against sharing their private info with firms, there’s a fixed danger that id thieves will entry the businesses’ databases, as identified by Erik Voorhees, whose cryptocurrency trade platform, ShapeShift, now permits customers to commerce with out KYC.

“Online, your Bitcoin address is kind of an identity, people maybe don’t know who are you in the real world, but the account is kind of identity.” This can be a type of pseudonymity.



Li’s need for larger transparency brings up concepts of integrity — an individual must be who they are saying they’re, and do as they are saying. With an ever-present self-sovereign digital ID, a form of factuality or actuality could possibly be imposed on the web world. The mission’s title affords a significant clue — ontology is a department of philosophy involved with the concepts of existence, being, turning into and actuality.

For Li, understanding who you might be coping with on-line is necessary, and he sees a future the place centralized social media platforms give method to an atmosphere through which customers management their info straight and use the safety of blockchain expertise to manage what they share and with whom they share it.

“Most identity is managed by centralized organizations or even governments, so it’s difficult for people to control all the verification processes. I think a decentralized identity is quite necessary in the digital world.”

Li believes that blockchain options resembling Ontology present stability between the 2 undesirable extremes of companies controlling all the information and strictly nameless interactions. “I believe this kind of balances conflicts between internet services and between privacy and data protection,” he says, referring to the current want for individuals to belief multinational firms with their non-public info and communications.

He envisions that digital id options have a future in industries resembling social media the place customers at this time should entrust their info with a centralized platform like Fb and Twitter. As a substitute, social media could possibly be a decentralized net of people who select to attach sure info to their persona and make posts by way of open-source blockchain protocols. It will be straightforward to confirm id, and there could be much less danger of data being used in unanticipated methods. “Maybe in the future we needn’t any Facebook or Twitter,” he says.

“I believe real information with a real identity will become a mainstream social network.”

Australia’s eSafety commissioner, Julie Inman Grant, just lately recommended {that a} blockchain-based digital ID system might serve to stop trolling and on-line abuse by customers who disguise behind the anonymity supplied by varied platforms. Such a system would nonetheless enable customers to work together on the web with out revealing their actual id however would make it simpler for legislation enforcement to detect abuse.

Digital IDs aren’t with out precedent: A 2009 legislation in South Korea required real-name registration on web sites, earlier than being struck down as unconstitutional in 2012, and the 2017 Chinese language Cybersecurity Regulation mandates that each one customers of Chinese language web sites present their telephone numbers with the intention to create an internet atmosphere that’s “safe and real” based on state-run media. They haven’t, nonetheless, caught on within the Western world, with Germany forbidding pointless real-name necessities since 1997.

Li, who relies in Shanghai, locations a excessive worth on actual individuals and status. Whereas he doesn’t have any downside with nameless profiles, he figures that such customers are much less probably to supply info that’s reliable or dependable. That’s definitely the case for extra conventional professionals, who search to leverage their reputations by displaying off their work.

“I believe people still want to tell everyone: ‘this is who I am, this is my opinion, these are my posts and articles’. But that is a personal choice.”

Supply hyperlink