Decentralised identity is a model of digital identity in which the person or organisation an identity describes controls the proof of it. An issuer, such as a government, bank or university, signs a statement about the holder as a verifiable credential. The holder keeps it in a digital wallet and presents it to a verifier, which checks the issuer's signature without contacting the issuer. Parties are identified by a decentralised identifier, whose public keys are published on a blockchain or another shared registry.
The model, also called self-sovereign identity, contrasts with accounts held by each service and with federated log-ins run by large platforms. Holders can disclose only what is needed, in some designs using a zero-knowledge proof to show, for instance, that they are over 18 without revealing a birth date. In finance, the aim is reusable know your customer checks and token allowlisting.