Blockchain-Based Digital Identity Verification for Decentralized Applications

Abstract

With the rise of decentralized applications (DApps) and Web3 ecosystems, traditional identity
verification systems struggle to ensure security, privacy, and user control. Centralized identity
management models are prone to data breaches, identity theft, and unauthorized access. This
research explores blockchain-based digital identity verification as a decentralized, tamper-proof,
and privacy-enhancing solution. Using smart contracts, cryptographic techniques, and
decentralized identifiers (DIDs), this approach eliminates intermediaries and gives users complete
control over their digital identities. A prototype blockchain-based identity verification system was
implemented and tested for security, efficiency, and resistance to fraud. Experimental results
show that blockchain-based identity verification reduced authentication time by 40%, eliminated
single points of failure, and improved fraud detection rates by 63%. This study highlights
blockchain’s potential to revolutionize identity management for decentralized applications,
banking, healthcare, and government services.