Microsoft to create an ID verification platform on Bitcoin

The so-called Project ION is an open-source, Layer 2 network built out of the public key infrastructure protocol Sidetree. The company’s idea is to make user names obsolete. As such, instead of logging into Facebook, email or any other application with a username, a digital decentralised ID (DID) can be used instead. The DID, being similar to a private key when signing a transaction to the Bitcoin network, proves ownership. Individual ION nodes on the secondary network will be responsible for keeping track of these DIDs, as well as timestamping them onto the Bitcoin blockchain for reference and attestation.

In order to create an ID, a user needs to wrap a public key into a DID creation document on the ION network, signing this input with their private key, and sending it to a node on the network. This ION node then archives the metadata (without accessing the data itself) as a DID document for other nodes to reference.

Every time a user updates their DID state, the corresponding node updates these changes in the DID document. When a batch is anchored on the blockchain, each ION node is constantly monitoring the blockchain, and will identify the hashes as originating from the ION network. They’ll pluck this transaction batch from the network, reference the DID documents in the nodes that sent it, and sync up with the latest states of the IDs to keep the network up to date.

DIDs could be used for zero-knowledge, proof ID verification in bars, or membership programs with hotels and airlines.