December 15, 2022
Our world is increasingly unfolding online. Digital generations don’t have the slightest clue about how life was before the internet; even ‘analog’ generations can’t.
And so will you if you’re trying to keep up with data developments. As Domo.com celebrates its 10th anniversary of the infographic ‘Data never sleeps,’ we can see online living challenges. According to this publisher, the amount of data created, copied, and consumed globally will be 97 zettabytes in 2022. While data can bring opportunities for your business, keeping up, collecting, and analyzing data comes with high-security risks and responsibilities.
Data collection and analysis have become increasingly crucial for businesses in recent years. The ability to track customer behavior and trends has allowed companies to understand their customers better and make more informed decisions about their business.
There are many benefits of data collection and analysis for businesses. By understanding their customers better, companies can provide them with the products or services they want and need. They can also improve their marketing efforts by targeting specific customers with ads or offers that are likely to interest them. Data can also help businesses understand which products are selling well and why and make changes to their product line if necessary. Additionally, data can help enterprises to make informed decisions about their business and track their progress over time.
But, this is a giant; personal data is the most valuable data for business growth. And not only decent companies are looking for business opportunities. Also, maleficent companies want to pitch in. By hacking, leaking, and controlling valuable data. So how do you keep your data safe? Besides regulations, new technologies arise that can help businesses comply with laws and manage this vital business information.
MiFID 2, or the Markets in Financial Instruments Directive number 2, is a set of regulations introduced in the European Union in 2018. The directive aims to increase transparency and fair competition in the financial markets and protect investors.
These regulations require financial institutions to take measures to prevent and detect financial crimes. One of the main ways that MiFID 2 does this is by requiring financial institutions to obtain and verify the identity of their clients.
To comply with MiFID 2, companies must adhere to some regulations, including providing the best execution to clients and transparency. In addition, firms must maintain records of all transactions and client orders. One of the critical provisions of MiFID II is the requirement for firms to provide "pre-trade transparency" - that is, they must make specific information about trades available before they occur.
This requirement has created a need for new technology to help firms comply. One such solution is decentralized identity - storing and sharing information about trades that do not require a central authority. Decentralized identity is a potential game-changer in financial services, as it can make markets more efficient and reduce costs.
MiFID I fell short of changing laws and regulations, so its operation did not protect investors fully. MiFID II has had an update, resulting in tightening on several fronts. Four key areas are addressed in MiFID II:
Identity and access management (IAM) provides frameworks for policies, processes, and coming together with tech. Companies always work with critical data, such as corporate or personal data. Only those who must be granted access should get it. IT professionals can apply the frameworks of IAM to their internal processes. For example, sign-on systems, 2FA, and privileged access fit within the frameworks of MiFID II to provide appropriate protection for all parties while ensuring transparency.
IAM contains several types of digital authentication that businesses can use to give their employees access to company information. We won’t dive to deep into this kind of information but think along the lines of behavioral or biometric authentication.
We massively pursue transparency and reliability but want to keep everything private. Perfectly logical. Verifiable credentials are equivalent to the old-fashioned paper documents we have had to carry around for decades to prove our identity. Diplomas, identity cards, and birth certificates are examples of these credentials. However, paper documents work the same for everyone and display an overall picture, while with the digital equivalent, you can add gradations.
Sometimes, as a company, all you need to know is whether someone is mature or meets specific educational requirements. MiFID II provides the frameworks to set this up so that there is an easy implementation of the GDPR. In addition, companies that want to avoid risk, but are also a proponent of maintaining digital autonomy, have a leg up thanks to MiFID II. Data sovereignty is guaranteed, allowing users to prove their identity without third-party intervention.
Decentralized identity is an essential concept in financial services. It refers to individuals' and organizations' ability to control their digital identities without needing a central authority. This is in contrast to the traditional identity management model, where a single organization (such as a government or a company) holds and controls all the data.
Decentralized identity is often seen as a way to increase privacy and security, giving individuals more control over their data. It can also help reduce fraud, as criminals can exploit no single point of failure.
Decentralized identity changes the way business is done by making it more secure and efficient. For example, a decentralized identity solution would allow companies to verify their customers' identities without relying on a central authority. This makes it much harder for criminals to impersonate customers and commit fraud.
Furthermore, decentralized identity solutions allow businesses to share data more securely and efficiently without worrying about the data being centrally stored or controlled. This not only makes it easier for companies to comply with data protection regulations but also provides a higher level of customer service.
Decentralized identities, MiFID 2, and web three achieve the same goal: a more secure and user-friendly internet. By aligning these three technologies, we can create a safer online environment for everyone. And this is also the mission of Truvity.
Truvity offers companies, developers, and identity experts complete decentralized digital identity management. We provide different solutions, such as
Truvity offers companies, developers, and identity experts the opportunity to fully discover and adopt the power of decentralized identities in their businesses and applications. Our cutting-edge, managed API platform converts the complexity of this new technology into a simple end-user platform.
At the core of Truvity lies a database solution designed in-house - a critical infrastructure component for the whole platform. This database allows us to offer SSI-based solutions that are not only simple and convenient for the end user but also highly secure and compliant with data protection regulations.
The Markets in Financial Instruments Directive number 2 (MiFID 2) sets the boundaries for how businesses should act transparently and fairly. And as such, companies should comply with or even do better than this bottom line.
Decentralized identities allow organizations to collect and use personal data in a way that is transparent, accountable, and compliant with the law.
If you're looking for a MiFID 2-compliant solution, look no further than Truvity. Our platform will give you the tools to do business transparently and fairly by carefully collecting, using, and protecting data in a way that complies with current law.
Get in touch with us today to find out more.