South Korea plans to provide digital identities encrypted by blockchain with smartphones to citizens in 2024 to facilitate its economic development., Bloomberg reported Monday.

The South Korean government stated that with the expansion of the digital economy, the ID embedded in the smartphone is an indispensable emerging technology to support the development of data. 

Through digital identities on the blockchain, the network verification process will be simplified, and users can log in without taking a certificate or a verification code sent by text.

Widespread use based on digital IDs will be expected to increase government efficiency by saving more administrative workforce and time, reducing wage fraud, expanding consumer credit, facilitating trade, and generating new markets.

Alternatively,  other applications of digital IDs include: facilitating online medical services; hotel check-in using a smartphone; prevention of ID forgery and theft; remote approval of contracts; fast boarding, etc.

McKinsey & Company believes introducing digital IDs could boost a country’s gross domestic product (GDP) by as much as 13% and reduce business costs by trillions of dollars.

Citing Hwang Seogwon, an economist at the Korea Institute for Science and Technology Policy, stressed the importance of risk assessment:

“Digitals IDs can yield huge economic benefits in finance, healthcare, taxes, transportation and other areas and may catch on quickly among the Korean population.”

Meanwhile, Suh Bo Ram, head of the Korea Digital Government Bureau, said South Korea could reap at least 60 trillion won ($42 billion) in economic value over a decade from the plan, which is close to 3% of South Korea’s national GDP.

In addition, South Korea seeks to adopt the digital identity system for 45 million people within two years. Under the plan, the government will not be able to access information stored on individuals’ mobile phones, including details on whose digital IDs are used and how and where they are used, as the system will rely entirely on blockchain technology-based decentralization identity.

Via Blockchain.news