Proof of Identity

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Proof of identity is a consensus protocol used in blockchain technologies in which each unique individual has one equal unit of the voting power. Proof of identity uses biometric identification methods to verify each individual. Proof of identity is different from proof of work and proof of stake because each individual has equal voting power. One does not get more voting power by investing more or mining with more cryptocurrency mining equipment. 

proof-of-identity

What problem does Proof of Identity solve?

Proof of identity solves the problem proof of personhood creates. This problem occurs when an attacker conducts a Sybil attack. A Sybil attack is when an attacker creates a large number of pseudonyms to gain influence in a network. Proof of work and proof of stake are methods to prevent Sybil attacks, but mostly benefit large groups of people and corporations. Because proof of identity gives each individual equal voting power, each person earns the same reward, regardless of how much they invest. 

How do users prove their humanity?

Individuals have to attend pseudonymous parties to prove their humanity. They can wear masks to remain anonymous. This is cumbersome because every user has to attend a new party every time the network expands. It could be the case that some individuals cannot join a certain party or forget one. 


Methodology
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Disclaimer
All trading involves risk. More than 80% of investors lose in spread bet and CFD trading. As these complex instruments allow for the use of leverage, there is a high risk of losing more money than you have deposited. Before attempting to participate in spread bets and CFDs, consider how well you understand them and if you can afford to lose your money.

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Stefan Grasic (Dipl.-Jur) is the World Wide Director of research for Buisness24-7 and has considerable experience in the financial and investment niche, but also enjoys writing articles for the general readership. Stefan is an active Crypto, Forex and general investment researcher advising blockchain companies at their start up level. He keeps fit by mountain biking, surfing, skiing and lots of other adrenaline sports.

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