A Business Case for "Findy"
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This document proposes the "Findy" network, a self-sovereign identity network for Finland. It discusses how current systems operate through silos that could be improved by decentralized, network-based business flows. The network would digitalize contracts using distributed ledger technology (DLT) so each party has their own copy maintained through business process flows. It would also establish digital identities for individuals and businesses on an Indy ledger with verifiable claims managed by agents. The document outlines the "Mercury" and "Jupiter" proofs-of-concept to digitally form limited companies and trade their non-listed shares on the network. The goal is a fully decentralized digital trade network integrating identity management and business processes.
A Business Case for "Findy"
- 1. © OP A Business Case for âFindyâ - The Finnish Self-Sovereign Identity Network Initiative Timo Hotti â Technology Strategist â OP Financial Group timo.hotti@op.fi
- 2. © OP P2P Integration / Middleman Our current way of building systems 2 Business Transaction Managemen t Silo 1 Identification Services Customer Identity Data Silo 2 Business Transaction Management Identification Services Customer Identity Data
- 3. © OP Party 1 Identifi- cation 3 Busines s Flow Party 1 Identity Party 1 (Buyer) Future â bilateral business transactions convert into multilateral network-based business flows Party 3 IdentityParty 3 Identifi- cationParty 3 (Insurer) Busines s Flow Party 2 Identifi- cationParty 2 Identity Party 2 (Seller) Busines s Flow Party 4 Identity Party 4 Identifi- cation Party 4 (Financier ) Busines s Flow
- 4. © OP The key problem: How to digitalize and decentralize contracts, the key building block of the economy? 4 + Digital Signers ⹠Parties? ⹠Authorizations? ⹠Signing? ⹠Verification? Digital Paper ⹠Execution Flow? ⹠Pre-requisites? ⹠T&Cs? ⹠Outcomes? Business Transaction Management Identity Data Management
- 6. © OP Digitalizing the Paper of the Contract ⹠DLT = Decentralized data management method for efficient management of contract data ⹠The contract has more than one party ⹠Every party has its own copy of the contract, delivered and maintained by the flows related to the contract ⹠When the contract is executed, it is validated and digitally signed by its parties ⹠DLT-protocol executing the flow ensures, that the state of the contract is the same in all copies of the contract ⹠The Notary ensures, that the contract has been approved by all parties of the contract Buyer Seller Notary 5) Finalizes 1) Orders 2) Acknowledges Business Transaction Management FinancierInsurer 3) Finances4) Insures
- 7. © OP For Individuals 1. Establish the identity (DID â Distributed ID) in the public ledger 2. Create the identity claims in the Agent and have them verified by 3rd parties For Businesses 1. Design the structure and content of the Digital ID for a legal entity as entityâs DIDs and verifiable claims âą Identifiers âą Ownership structures (shareholder claims) âą Representation mechanisms (Powers-of-attorney) 2. Design the legally compliant processes for creating and maintaining the Digital ID using decentralized transactions âą Setting up the company âą Specifying the governance rules âą Authorize persons as a representatives of the company 7 Identity Data Management Digitalizing the Signers of the Contract - The Self-Sovereign ID for individuals and businesses Companyâs Identity Employee CEO Board Member Share- holder
- 8. © OP Practice â Building a fully decentralized digital trade network 8
- 9. © OP How does the combined crypto data and transaction management network work? Indy Agent âą Manages private data of the digital identity âą It can be anything related to the identity âą Discloses verifiable claims about the identity âą âOwner of X shares of company Yâ âą âBanks with OPâ âą May initiate or participate in a process executed in the transaction network Transaction management node âą Implements, together with other TX mgmt nodes, the multi-party business processes of the network accoding to the jointly agreed rules âą Communicates with the Indy Agents of the parties of the process âą Maintains the history of transactions executed in the network âą Is able to attest to identity claims such as âPerson A is the current owner of X shares of company Yâ Indy Ledger network âą Manages, in consensus, the public data of the digital identities, including organizations âą Identifiers âą Public Keys âą Address of the Indy Agent of the identity âą Acts as the identity directory of the network
- 10. © OP Mercury + Jupiter = PoC of a new digital company ecosystem 10 2018 Step 1: âMercuryâ Step 2: âJupiterâ PoC: founding a limited company fully digitally into an Indy network using Corda-flows Launch: May press release Launch: Digital identity for companies Roles and mandates Registering to tax prepayment register and VAT register Registering to company register (PRH) Opening of company bank accounts Debiting equity capital Registering shareholders and company shares PoC: Trading of non-listed company shares Private placement Direct sales of shares to named buyer Share trading enabled by secondary market matchmaker (Personnel stock- options) 2019 - Step 3âŠ
- 11. © OP Mercury â How to create a Legal Person 11 1. Create company founding documents 2. Validate participating shareholders (KYC) 4. Sign representation rights for stakeholders 7. Create bank account & debit equity 3. Shareholders sign founding documents digitally 5. Equity payment authorization (PSD2) 6. Full KYC Check 8. Verification & registration BUSINESS IDEA! BUSINESS-READY COMPANY HAVING ITS OWN SELF-SOVEREIGN IDENTITY! 0. Create globally available digital identities for Individuals
- 12. Jupiter â How to trade shares of the digital company 12 Sellerâs bank Buyerâs bank Seller Buyer Trading process orchestration and rules Transaction history Digital identities Tax administration Information brokers DLTnetworks Board Company shareholders Company Company and its stakeholders Regulators Companyâs bank Indy Agent (Identityâs private data) Indy Ledger node (Identityâs public data) Corda Ledger node (Transaction data) Process Notary From: seller To: buyer ConfirmDelivery:Yes Topic: 10 Shares of X cc: theCompany 1 2 4 3 6 7 8 9 1112 13 10 10 10 10 10 PSD2 PSD2 14 15
- 13. 13 Decentralized Business Processes Decentralized Identity Management Identification Services âŹâŹâŹ âą Identification methods âą Identification data âą Signing keys âą Link to identity wallet âą Self-sovereign principle âą Distributed Ids + Verifiable Claims âą Credentials for biz processes âą PoAs âą Management of identityâs data created by biz processes âą For Individuals AND Businesses âą Digital corp ID creation âą Non-listed share trading âą KYC âą Other trade networks âą Other processes, e.g. healthcare (âApolloâ)(âFindyâ)(âSisuIDâ) The Future Ecosystem