Meet ShoCard, a startup that stores your identity onto bitcoin’s blockchain so that you can prove your identity whenever you need to. ShoCard wants to replace cumbersome bank and credit card identification processes with something much more secure and practical. The startup is launching on stage today at Disrupt NY.
“A lot of companies are looking at the blockchain for things other than bitcoin. We’ve created a digital identity card that is as easy to use as a driver’s license but it’s so secure that a bank can rely on it,” ShoCard co-founder Jeff Weitzman told me. “We’re using public and private keys, data hashing, multi-factor authentication.”
This is a little complicated if you’re not familiar with how bitcoin works, but it’s very interesting. Your ShoCard is basically a tiny file that only you can manipulate. When you create your ShoCard, you first scan your identity document and sign it. Then, the mobile app will generate a private and public key to seal that record. It is encrypted, hashed and sent to the network of communicating nodes running bitcoin software for later use.
After this initial creation process, you will use the company’s app to retrieve your information. But the best part of this technological feat is that ShoCard hides all this complexity for the consumer. There are multiple use cases for something like ShoCard, starting with online purchases.
“There are some systems out there now that banks are using — it can be a window that appears from your bank and says you have to log in here and use this PIN code that we gave you three years ago,” Weitzman said.
ShoCard wants to partner with banks to replace these weird redirections when you do an online purchase. It’s a win-win situation: ShoCard gives you peace of mind because you have to approve purchases with your phone, and the credit card company gets a definitive identity check.
There’s an added security benefit, as well. If someone is using your credit card to purchase something online, you will get a notification and you can block the purchase right away.
Other projects have been taking advantage of the blockchain to create an identity layer, such as OneName or World Citizenship. But ShoCard is tackling this issue with use cases in mind and is already in talks with companies that deal with identity management — credit card networks, banks, anti-phishing companies and others.
Working with banks is a smart first step for the startup. Banks have been subjected to “know your customer” laws and already need to thoroughly check your identity when you open an account. They can verify your identity before it is sealed using ShoCard, making this process much simpler for the startup.
I would love to see my bank use something like ShoCard. Yet, the startup still has a big challenge ahead. How do you convince slow-moving institutions like banks to partner with you and switch to a brand-new identity management system?
“A lot of companies are looking at the blockchain for things other than bitcoin. We’ve created a digital identity card that is as easy […]