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As governments and organizations increasingly explore digital identity systems, decentralized digital identity (DDI) has emerged as a compelling alternative to centralized models, offering enhanced privacy, user autonomy, and resilience. A critical challenge, however, lies in identifying blockchain architectures that align with regulatory standards while preserving decentralization and scalability. This paper examines the key requirements outlined by EU regulations and W3C standards for DDI implementation. It conducts a comparative evaluation of existing decentralized identity solutions and analyzes blockchain platforms - Hyperledger Indy (permissioned), Ethereum Layer-2 and Polygon (permissionless). The study finds that Polygon, adapted into a permissioned configuration, can support essential privacy-preserving technologies such as Zero-Knowledge Proofs (ZKP), Verifiable Credentials (VC), and Decentralized Identifiers (DID), providing scalability and interoperability. Based on these findings, the paper recommends Polygon as a suitable foundation for standards-compliant DDI systems, provided it is implemented with appropriate permissioned controls. This work contributes to the ongoing research on aligning blockchain infrastructure with regulatory and technical requirements of digital identity.

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Blockchain-Based Solution for Decentralized Identity Aligned with EU and W3C Standards

  • 会议论文

  • 发表日期：

    2026年

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  • Laura Atmanavičiūtė,
  • Mykolas Rutkauskas,
  • Aristidas Lukas Končius,
  • Gintarė Košubienė,
  • Saulius Masteika

摘要

As governments and organizations increasingly explore digital identity systems, decentralized digital identity (DDI) has emerged as a compelling alternative to centralized models, offering enhanced privacy, user autonomy, and resilience. A critical challenge, however, lies in identifying blockchain architectures that align with regulatory standards while preserving decentralization and scalability. This paper examines the key requirements outlined by EU regulations and W3C standards for DDI implementation. It conducts a comparative evaluation of existing decentralized identity solutions and analyzes blockchain platforms - Hyperledger Indy (permissioned), Ethereum Layer-2 and Polygon (permissionless). The study finds that Polygon, adapted into a permissioned configuration, can support essential privacy-preserving technologies such as Zero-Knowledge Proofs (ZKP), Verifiable Credentials (VC), and Decentralized Identifiers (DID), providing scalability and interoperability. Based on these findings, the paper recommends Polygon as a suitable foundation for standards-compliant DDI systems, provided it is implemented with appropriate permissioned controls. This work contributes to the ongoing research on aligning blockchain infrastructure with regulatory and technical requirements of digital identity.