Understanding How Identification And Authorization Actually Work In The Blockchain World.

The terms identity, persona, authentication, and authorization can often get misconstrued. It’s important to understand the distinction between these terms, and how blockchain can be applied to provide solutions, such as wallets, to identity, persona, authentication, and authorization processes.

Currently, the management of the previously mentioned processes can be inconvenient and costly for both consumers and organizations, especially if both parties become complacent with how they secure their data. 

In this article, we’re going to clearly define the difference between each of these terms, and discuss how blockchain-based digital wallet solutions can be utilized to transform how these data processes currently work, and how they can be used by organizations and consumers to safeguard their data.

The Main Differences


Identification is the process of establishing one’s identity. One of the most common real-world examples of identification include usernames for website accounts or identification documents such as passports and driving licenses. An individual would proclaim their identity to a specified authority, who then needs to verify the person’s identity. 

For example, you’re queuing to get into a concert, and the steward asks you for your full name to claim your identity on the guest list.


Personas are used to define a person’s or group of people’s actions and behaviors. Persona’s do not have to be linked to a person’s identity, however, they can be used to directly target a group of people based on specific variables. Individuals may carry different personas depending on the vendor they’re working with, with each persona highlighting a different part of their personality or behavioral patterns.

Personas are a crucial part of any marketing team’s strategy. Research shows that the use of personas can increase marketing-generated revenue by up to 171%

For example, the marketing team would have targeted advertisements at you for the concert since you like the band playing at the concert – information that you have uploaded online.


Authentication refers to the process where someone has to verify their claimed identity. There are currently many methods that an individual can use to prove their identity. One of the most common is the use of a password, which enables any individual to prove that they are the rightful owner of a specific username.

Back to our concert example, you’ll have to provide the steward with your ticket and a form of identification, such as a passport.


Authorization is where an individual is granted access to a specific area based on their identity and authentication credentials. Once a person has claimed their identity and proven that they’re the true owner of that identity, they’ll be given permission (authorized) to enter. 

Now that you’ve been able to claim and prove your identity to the steward, he will now permit you to enter the concert.

Current Issues With These Processes

Many issues currently affecting how the aforementioned processes work;

Issues with identification: One of the major issues with current identification processes is that there is a huge risk for companies who decide to store the essential information required for customer identification, such as Social Security Numbers, full names, home addresses, etc. There are ever-growing concerns with how consumer data is handled, as many organizations have fallen prey to the threat of data breaches compose by cybercriminals.

Statistics show that identity theft is ever-increasing, with over 16 million people in the United States were victims of identity fraud, costing $16.8 billion.

Issues with Authentication: One of the main sticking points with popular authentication methods such as passwords is that users have to remember a multitude of different passwords for each site they subscribe to. This creates so-called “password fatigue”, where individuals can become distressed due to the number of passwords and authentication codes that they’re required to remember.

Current research, conducted by Yubico, has shown that people spend nearly eleven hours every year just typing in passwords – time which could easily be saved by the use of a more efficient solution. The research also found that organizations spend an estimated $5.2 million on password and authentication solutions. 

Issues with Authorization: Authorization systems, specifically ones that are centralized could be prone to failure. If the system begins to malfunction, organizations could potentially run the risk of either completely blocking their user base from entering their site, or risk having cybercriminals hack into other people’s accounts by bypassing the authorization system.

Issues with Personas: Personas can be extremely vague, and whilst they may provide organizations with a brief picture of their target audience, current persona processes do not always provide the levels of clarity that marketers/data seekers require for successful marketing campaigns.

How can we adopt a sustainable transition model?

There are a number of shortcomings associated with today’s internet infrastructure, and one of its most potent problems is its inherent centralization. Several mega corporations control significant swaths of the internet, which too often makes digitalization contingent upon these platforms. Fortunately, there is a burgeoning cottage industry of companies providing an alternative to conglomerates like Amazon or Microsoft. 

For instance, ThreeFold, a decentralized alternative to the current web infrastructure that is community-driven and sustainability-focused, is preparing an alternative to the big tech companies that currently dominate the market. The platform relies on blockchain technology and a tokenization methodology to power an independent internet that stands in contrast to the centralized institutions from which today’s businesses can choose from. 

As companies and consumers become increasingly skeptical of big tech companies, there is an opportunity to adopt a sustainable transition model that imbues both the ethos and the capabilities that everyone desires. 


Blockchain-based initiatives can be utilized in many different ways to significantly improve how data is handled by consumers, vendors, and seekers. Blockchain wallets will make it possible for individuals to securely store different identities and personas behind on a unique form of authentication. 

This makes the process of gaining authorization to a vendor’s services completely seamless and doesn’t require the person to hold constantly input different identities. Seekers could also improve their marketing strategies as they’ll be able to gain access to multiple personas an individual holds if they’re granted access by the consumer.

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