Decentralized identity (ID) solutions could be the next blockchain use case to onboard the next wave of mainstream adopters, according to Cardano’s sustainability lead.

Speaking during a panel discussion at the Web3 Corporate Innovation Day, Cardano’s Alexandre Maaza said blockchain technology still lacks robust use cases to attract the next generation of blockchain adopters.

However, the emergence of blockchain-based decentralized identity solutions could provide the next “killer” use case to attract millions of new users. Maaza said the Cardano Foundation believes that Web3 still lacks a “killer, scalable use case” that is relevant for businesses and people:

“One of the views that we have at the foundation is that digital identity for people, products, data and documents is one of these killer applications that can scale.”

Web3 decentralized IDs are privacy-oriented solutions that allow users to provide only the minimum amount of information required for verification, instead of sensitive personal data.

Decentralized ID users can also withdraw their information via seed phrases since identities are stored locally in users’ crypto wallets — becoming increasingly important privacy-preserving solutions.

Blockchain needs a non-speculative use case to attract the next billion users

Much of the hype around cryptocurrency can be attributed to price speculation from retail investors looking for profits. However, blockchain technology will need a non-speculative use case to attract mainstream adopters, as Maaza explained further:

“I believe a killer use case where you’re talking about millions and billions of people, things represented onchain, that are not speculative in nature, is what will bring this kind of technology to the forefront.”

Related: Storm Partners launches Web3 innovation sandbox in Geneva

Ton Foundation’s director of investments, Justin Hyun, also believes that onboarding the next 500 million users will require simple apps with “actual usability,” like blockchain-based Telegram Mini Apps that could be a “Trojan horse” for mass blockchain adoption.

Speaking exclusively to Cointelegraph, Hyun said that abstracting complexity away from users would also prove crucial in their aim to onboard half a billion users:

“Bringing 500 million people onchain by 2028 — which is our goal — is going to require use cases that interact with the blockchain without the user knowing that in the front end.”

Related: Bitcoin breaks 18-month hashrate uptrend: Are BTC miners capitulating?

Decentralized ID could save companies from data breaches

While developing a decentralized ID solution is not a profit-generating activity for most companies, it could save significant costs by avoiding potential data breaches.

Maaza said that the value of digital identity to certain businesses that harvest data 

“For many other businesses, it’s a cost center. You have to protect customer data. And when that gets breached, that incurs large amounts of damage control.”

Cardano is among a number of blockchain networks developing its own non-custodial digital identity wallet.

Despite the technological paradigm still being in its infancy, some countries are already exploring decentralized IDs. For instance, Istanbul is employing decentralized identity solutions to enhance data privacy, using Omchain’s proof-of-identity (PoI), which operates without the need for database queries during authentication.

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