Bhutan's Blockchain Identity Revolution: A New Era for Digital Sovereignty

In a groundbreaking move, Bhutan has chosen Ethereum as the foundation for its national digital identity framework, paving the way for a more decentralized and secure future.

TL;DR
• Bhutan adopts Ethereum for decentralized identity.
• The initiative aims to provide citizens with verifiable, blockchain-secured identities.
• This move sets a precedent for other nations seeking to protect digital identities in a decentralized manner.

Summary
Bhutan is adopting Ethereum to secure its digital identity framework, with plans to provide every one of its 800,000 citizens with a verifiable, blockchain-secured identity by 2026. This move is part of a broader experiment with emerging technologies and reflects a growing trend in digital identity management amid rising identity theft. The initiative will utilize a Self-Sovereign Identity architecture built on Decentralized Identifiers and Verifiable Credentials, allowing citizens to control their own credentials rather than entrusting them to a central registry.

The new National Digital Identity system will follow a decentralized approach, enabling citizens to hold an encrypted wallet accessible via smartphone, storing verified data such as birth date, address, or educational record. This shift is expected to significantly reduce costs, with estimates suggesting a decrease from $5-10 per user annually to under $1. The project could also make Bhutan one of the first countries to demonstrate that public infrastructure can rely on an open, permissionless chain like Ethereum.

The adoption of Ethereum for digital identity management could have far-reaching implications, including the tokenization of real-world assets such as land titles, education records, or professional licenses. Ethereum is the dominant blockchain platform for tokenized assets, controlling 62% of the market. The success of this initiative could reinforce Ethereum's image as the default settlement layer for money and metadata, and accelerate the development of decentralized applications and services.

As Bhutan's experiment unfolds, it will be crucial to monitor its impact on the global adoption of blockchain technology and its potential to reshape the future of digital identity.