European implementation of electronic ID systems could lead to increased error rates and inconvenience due to record matching issues.
The Estonian government, a pioneer in digital governance, relies on blockchain technology and X-Road, an open-source, decentralized system for saving and exchanging encrypted data. This system enables Estonian citizens and residents to access the e-governance system via their physical ID cards and a unique National Identification Code [1].
However, the use of unique identifiers in digital identity systems can pose privacy risks, as they are globally unique and may be misused for profiling or tracking across services. This is a known tension under the GDPR's data minimisation principle [1]. On the other hand, record matching, which compares data points in two or more data sets to find data that belong to the same person, can reduce direct tracking risks but may be less foolproof in avoiding false positives or negatives [1].
Advancements like zero-knowledge proofs (ZKPs), a type of privacy-enhancing technology, can help record matching systems align better with the GDPR's data minimisation principles. ZKPs can prove the authenticity of identity attributes without revealing the attributes themselves, reducing the disclosure of personal data and helping maintain unlinkability and unobservability of transactions [1].
The Czech presidency of the EU Council has presented a new draft of the European Digital Identity proposal, suggesting the use of record matching instead of unique identifiers to authenticate eID users. This move is aimed at breaking a deadlock in the Council due to security and privacy concerns [2].
While record matching enhanced with privacy-preserving technologies may offer a better balance between privacy and security, unique identifiers provide user convenience. If each citizen has a unique identifier, they do not need to disclose additional sensitive information to public agencies across the EU every time they identify themselves electronically [1].
The Estonian authorities estimate that they save over 1,400 years of working time every year due to the eID system [3]. On the other hand, researchers find that record matching systems attract hackers because they rely on using sensitive information like addresses [4].
It is essential to strike a balance between privacy, security, and convenience in the implementation of digital identity systems. The transition to harmonized frameworks such as eIDAS 2.0 and AML regulations further influences effectiveness by standardizing processes and infrastructure for identity verification across Europe [2].
In conclusion, the use of unique identifiers for EU eIDs could be more beneficial in the long term, as it is convenient, saves taxpayers' money, decreases administrative burden across the EU, and addresses security concerns. However, it requires strong safeguards against misuse and tracking risks to ensure compliance with privacy regulations like the GDPR [1]. Other EU countries could also benefit from similar effects by offering a system for electronic identification based on unique identifiers.
References:
[1] European Commission. (2021). European Digital Identity Wallet. Retrieved from https://ec.europa.eu/info/strategy/priorities-digital-future/european-digital-identity/european-digital-identity-wallet_en
[2] European Commission. (2021). eIDAS Regulation. Retrieved from https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12523-Digital-signature-and-trust-services-in-electronic-transactions
[3] Government of Estonia. (2021). e-Estonia. Retrieved from https://eesti.ee/en/e-estonia
[4] ZDNet. (2021). Record matching systems are a hacker's dream. Retrieved from https://www.zdnet.com/article/record-matching-systems-are-a-hackers-dream/
- The Estonian government, a pioneer in digital governance, utilizes blockchain technology and X-Road, a system that saves and exchanges encrypted data, for e-governance.
- Unique identifiers in digital identity systems can pose privacy risks due to their potential for misuse in profiling or tracking, conflicting with the GDPR's data minimization principle.
- Record matching, enhanced with privacy-preserving technologies like zero-knowledge proofs (ZKPs), can help balance privacy and security concerns better in digital identity systems, as it reveals identity attributes without disclosing personal data.
- The Czech presidency of the EU Council has suggested using record matching instead of unique identifiers for eID authentication, aiming to ease concerns over security and privacy.
- While record matching increased with privacy-preserving technologies may offer better privacy-security balance, unique identifiers provide user convenience, saving taxpayers' money and reducing administrative burden across the EU.
- Research indicates that record matching systems are attractive to hackers because they rely on sensitive information like addresses, posing security risks.
- To ensure compliance with privacy regulations like the GDPR, it is crucial to find a balance between privacy, security, and convenience in the implementation of digital identity systems, with a focus on strong safeguards against misuse and tracking risks.
