Every day, we encounter various events where we need to verify our identities. Whether you’re applying for a loan, booking flight tickets, or signing up online for a service, identity verification is crucial.
However, most conventional authentication processes are inconvenient and even threaten consumers’ details.
Whether we talk about inappropriate data collection and storage or a loophole in managing consumer identities, anything could lead to compromised sensitive information.
Here’s where the concept of decentralized authentication in identity management comes into play.
Storing essential information like name, address, and credit card details at a centralized location could mitigate the risk of identity disclosure or a breach of privacy.
Let’s understand how decentralized authentication paves the path for a secure and seamless authentication process across multiple platforms in 2022 and beyond.
What is Decentralized Authentication?
Decentralized authentication means no central authority is required to verify your identity, i.e., decentralized identifiers. DIDs (Decentralized Identifiers) are unique identifiers that allow for decentralized, verified digital identification.
A DID any subject identified by the DID's controller (e.g., a person, organization, thing, data model, abstract entity, etc.).
DIDs, unlike traditional federated identifiers, are designed to be independent of centralized registries, identity providers, and certificate authorities.
How is Decentralized Authentication Used?
Let’s understand this with a simple example. If someone creates a couple of personal and public keys in an identification wallet, the public key (identifier) is hashed and saved immutably in an ITF.
A dependent third party then proves the person's identification and certifies it by signing with its non-public key.
If the person desires to get admission to a carrier, it's sufficient to give its identifier within the shape of a QR code or inside a token. The provider company verifies the identification to evaluate the hash values of identifiers with their corresponding hash facts within the ITF. The certification report is likewise saved within the ITF.
If they match, admission is granted. In greater ideal scenarios, the person can derive separate key pairs from a non-public key to generate different identifiers for one-of-a-kind relationships to allow privacy-pleasant protocols.
Benefits of Decentralized Authentication
Both government and private sectors are already leveraging the true potential of decentralized authentication to deliver a seamless and secure user experience to their clients.
The growing use of decentralized identity eventually eliminates the need for storing user credentials on several websites, which further reduces the risk of identity theft.
Here are some business advantages of incorporating decentralized authentication:
It helps establish trust in a customer since identity frauds are reduced, and there is a negligible risk of identity theft.
Personally identifiable information of customers is secured and adequate security for other sensitive information like credit card details or medical information.
Efficient and quick verification of the authenticity of data by third-party.
Reduced vulnerability to information misuse via the ones charged with coping with it and cyberattacks, fraud, and different monetary crimes.
Generate remarkable degrees of human acceptance as accurate among the corporation and its customers and companions.
Reduce the compliance burden of dealing with clients' private information in services.
Allow participation in open, trustworthy, interoperable standards.
The Bottom Line
The modern technological ecosystem has offered endless possibilities to build a better and safer future with more robust control over our individual privacy.
Decentralized authentication can be the game-changer in mitigating the risks of identity theft in both the government and private sectors. Organizations thinking of enhancing consumer information security should strictly put their best foot forward to incorporate decentralized authentication for a secure experience.
We're in an era where the number of machine identities has already surpassed the number of human identities, which isn’t something that should be ignored from a security perspective.
Whether we talk about an IoT ecosystem containing millions of interconnected devices or application programs continuously seeking access to crucial data from devices and other apps, machine identity security is swiftly becoming the need of the hour.
What’s more worrisome is that cybercriminals are always on the hunt to exploit a loophole in the overall security mechanism in the digital world where machine-to-machine communication is the new normal.
Hence, it’s no longer enough to reassure or assume services/devices accessing sensitive data can be trusted since a breach or sneak into the network in real-time processing can go undetected for months or even years, causing losses worth millions of dollars.
Let’s understand how M2M authentication works and paves the path for the secure machine to machine and machine to application interactions without human interventions.
What is Machine Identity? Why Does Security Matter Now More than Ever?
Just like humans have a unique identity and characteristics that define a particular individual, machines have their identities that help govern the integrity and confidentiality of information between different systems.
Machines leverage keys and certificates to assure their unique identities while accessing information or gaining access to specific applications or devices.
Today, business systems undergo complex interactions and communicate autonomously to execute business functions. Every day, millions of devices constantly gather and report data, especially concerning the Internet of Things (IoT) ecosystem, which doesn’t even require human intervention.
However, adding stringent layers of security isn’t a piece of cake at such a micro-level. Hence, cybercriminals are always looking for a loophole to sneak into a network and exploit crucial information.
Hence, these systems need to efficiently and securely share this data during transit to the suitable systems and issue operational instructions without room for tampering.
A robust machine-to-machine (M2M) communication mechanism can be a game-changer concerning the ever-increasing security risks and challenges.
What is Machine-to-Machine Authorization?
Machine-to-machine (M2M) authorization ensures that business systems communicate autonomously without human intervention and access the needed information through granular-level access.
M2M Authorization is exclusively used for scenarios in which a business system authenticates and authorizes a service rather than a user.
M2M Authorization provides remote systems with secure access to information. Using M2M Authorization, business systems can communicate autonomously and execute business functions based on predefined authorization.
Why Do Businesses Need M2M Authorization?
Since we’re now relying on smart interconnected devices more than ever before, secure data transfer is undeniably a massive challenge for businesses and vendors offering smart devices and applications.
Moreover, these smart devices and applications continuously demand access from other devices and applications, which doesn’t involve any humans; the underlying risks and security threats increase.
IT leaders and information security professionals can’t keep an eye on things at this micro-level, which is perhaps the reason why there’s an immediate need for a robust mechanism that can handle machine-to-machine communication and ensure the highest level of security.
Apart from this, businesses also need to focus on improving the overall user experience since adding stringent layers of security eventually hampers user experience.
How LoginRadius’ Cutting-Edge CIAM Offers Seamless M2M Authorization?
LoginRadius M2M helps businesses to provide flexible machine-to-machine communication while ensuring granular access, authorization, and security requirements are enforced.
LoginRadius’ M2M Authorization offers secure access to improve business efficiency and ultimately enhances customer experience. M2M provides several business benefits, including, but not limited to:
Seamless user experience backed with robust security
Efficient authentication and data exchange
Grant, limit, or block access permissions at any time
Secure data access across multiple business systems
Granular data access with predefined scopes
Final Thoughts
With the rise of smart devices, the rising threat of machine identity theft is increasing among developers and vendors offering these services.
Organizations need to understand the complexity of the situation and put their best efforts into incorporating a smart security mechanism that can carry out machine-to-machine authorization tasks like a breeze.
LoginRadius’ cutting-edge CIAM offers the best-in-class M2M authorization that helps businesses grow without compromising overall security.
In 2019, few of us were wiser to the change that the world would go through. It seems as though one day we were exchanging ideas and trends about the world of technology in 2020, and in an instant, a health crisis accelerated the rate of change for everyone.
If it is not yet obvious, no industry has gone unscathed.
Organizations in the public and private sector have had to re-evaluate their offering, redefine how they offer their service, and redesign their approach to data. When the big data frenzy settled in, organizations that had a large database, as well as startups, seemed the best fit for data-based techniques and technology. As a result, organizations of that nature invested in protecting the data they had as well as the data they would be collecting in the future.
Your local health office, the restaurant around the corner, the airline that is transporting you to your loved ones for the holidays, and the seamstress who gets you ready for that traditional ceremony all collect valuable data and have likely used it to build a digitalsystem that helped them survive the last two years. Moreover, organizations across industries have been able to achieve better visibility, experience growth, reach new markets, offer more targeted products and services, and track their resources with more clarity by simply using data. The benefits seem exhaustive.
No matter the size, age, or nature of the organization…” how we do things” no longer flies.
But with great opportunity and necessity comes great responsibility. What has always been clear to #cybersecurity experts and practitioners, and is now evident to leaders across industries is that the minute the data they have on their users becomes a part of how they fulfill a mandate or make money, their data becomes worth protecting.
For individuals who are out to prove their technical skills, test the power of their malware, or bad actors, the data in any organization is valuable. And if they see that value, you should too. Cybercrime is the broader umbrella that #datatheft falls under. Malware that compromises data and web-based attacks that place the integrity of your organization in disrepute were estimated to have cost $2.6 million and $2.3 million respectively. Forbes expects cyber attacks to reach $2.65 billion by 2035, an acceleration that should raise eyebrows for every leader across industries. Any fraction of that is no small change.
In 2020, activity surrounding stolen data increased significantly. Vulnerabilities in retail, health, energy and transport made airwaves and beyond the financial cost, societal disruption and thinning trust are ongoing consequences. Data is being stolen for current use or for future use, so even in instances where data might not yield direct financial benefits, its potential value for use in the future makes it attractive.
Cybercriminals and general threats to your data are always closer than you anticipate. Individuals within the organization or industry that have done the work to evaluate how much that data is worth to the organization or the darkweb sees the value that was not protected by those that hold it.
Data protection is a financial concern, a governance priority, and a key aspect of user relations. Gone are the days of seeing data as only valuable to some industries and not others and most certainly the days of leaving data protection to the discretion of the IT department are long gone. It is a leader's responsibility to attend to the protection of data, and by proxy, the organization-no matter their technical expertise.
So how can you begin valuing your data?
1️Training your broader organization on the importance of handling all forms of data with precision, confidentiality, and care.
This is important no matter the value of your data-based activity. Prioritize everyone that comes in contact with any aspect of organizationaldata and ensure that their daily activities align with data protection.
2️Simultaneously employ digitization with data protection software. Seek the assistance of cyber professionals to help you choose and set up the best software.
Do not interrupt the function of your current software and processes. Rather, aim for all systems to work in harmony.
3️Treat access to your data as a privilege and provide access in accordance with those privileges.
4️Continuously evaluate the size and nature of the data that you are collecting and make sure that your software can handle it, processes agree with the changes, and systems are compliant.
5️Conduct a frequent industry analysis to figure out what your data is worth, the various uses it might have, and the value it might bring for your organization. In essence, see the value before cyber attackers do.
The reality is that no matter how sacred, bespoke, or traditional an industry might be, none will be untouched by the digitalmovement. Digitization, data-based products and services, and the influx of users to platforms that collect data about their lives, biometricinformation, and behavior mean the data profile across all industries will be much more valuable.
As a leader, consider the value of your organization’s data, think of what it can do for you as well as the cost of fixing an attack, and then you will appropriately invest in the security of your data.
Understand the value of that data to you and to others and protect it accordingly
Protecting customer data is paramount to every business organization. Even though businesses deploy the most stringent security measures to safeguard data, malicious actors somehow find security shortcomings to access network systems and cause data breaches, compromising the confidentiality, integrity, and availability of information.
Cybersecurity firms like Okta, which provides identity management solutions and deals in authentication space, make the backbone of an organization's cybersecurity posture. Okta serves 15000+ customers worldwide. The Okta data breach by Lapsus$ is a recent example of what can happen if business organizations depend on third-party solution providers who show laxity in implementing robust cybersecurity strategies, frameworks, and controls.
It is also a cautionary tale for cybersecurity MSPs (Managed Services Providers) and ITSPs (IT Solution Providers) to ensure that they have the best of security controls in place to prevent incidents like this.
What Is Okta?
Okta is an identity platform and offers identity and access management solutions such as Single sign-on (SSO), Multi-Factor Authentication (MFA), etc., for an organization's customers and employees.
Why Is Okta In the News?
Okta’s CSO (Chief Security Officer) David Bradbury recently published an official statement about a support engineer whose computer was accessed by malicious actors for five days in mid-January (between January 16 to 21, 2022) and said they detected the unsuccessful attempt early on.
How Was the Attack Executed?
Okta has now confirmed that malicious actors had access to one of its employees' laptops for five days in January 2022 but maintained there has been no data breach and remains fully operational. However, they concede that around 2.5% of its customers (about 366) might have been affected.
Here is how the attack happened.
On March 22, 2022, a hacking group identifying itself as Lapsus$ posted some screenshots in its Telegram channel claiming to have compromised Okta's internal systems. The screenshots included Okta's Slack channels, super admin dashboard (access to reset passwords and MFA of their business customer’s employees — the customer in the screenshot was Cloudflare), and JIRA board.
Okta's CSO responded through a blog post stating that the incident that Lapsus$ refers to had happened in January 2021 when it detected an attempt by hackers to compromise the account of a customer support engineer working for a third-party service provider.
Okta alerted the service provider, suspended the engineer's account, and terminated the user's active Okta sessions. Besides, the company shared pertinent information with a third-party forensics firm for investigation.
The investigation reported that hackers accessed the engineer's laptop for five days in January 2022.
However, Lapsus$ claims that it had gained admin access to Okta's systems for two months, and it found Okta storing AWS keys in Slack channels. Furthermore, the hacker group claimed that it used its access to focus on Okta's customers.
Who Is Behind Okta’s Breach?
News reports show that a group of unscrupulous actors identifying themselves as Lapsus$ in their Telegram channel was behind this Okta breach. They were aided by a customer support engineer working for a third-party service provider whose laptop was accessed by these hackers to gain vital information. Lapsus$ is also known as a notorious threat actor group — DEV-0537. This group has a history of taking over individual user accounts to drain their crypto holdings at cryptocurrency exchanges.
The Key Reasons That Caused The Security Breach
The forensics report cited by Okta's CSO did not state how the hackers managed to gain access to the support engineer’s laptop, but the fingers point towards negligence by the engineer. However, the hackers claim to have had access to Okta's systems for more than a month before the January 2022 incident. If these claims are valid, it indicates a significant security breach at Okta's network center.
Okta Breach: What Was the Impact?
The Okta breach exposed the security frailties of the Okta network system and put 15,000 Okta customers’ data at risk. However, Okta stated it had contacted the affected 2.5% of customers, appraising them of the matter. Okta further noted that the customers need not take any precautionary measures as their data is safe.
The CSO blog post went on to add that the damage was restricted to the access that support engineers have, such as Jira tickets and lists of users. Though customer support engineers facilitate password resetting and MFA, the hackers did not seem to have obtained this information. The CSO also confirmed that customer service engineers could not create or delete users.
Notably, Okta's customers include high-profile enterprises like FedEx Corporation and Moody's Corporation. Hence, Okta's shares plunged 11% immediately after hackers claimed the breach that has put thousands of Okta customers at risk.
What to Learn From Okta's Cyber Hack?
1) Limit Access on a ‘Need-to-Know’ Basis
Limiting access and permissions to the employees is the first step to take. Employees and contractors should only be provided access on a 'need-to-know' basis and must be provided on a ‘least privilege’ basis (minimum access needed to perform a task or job). For example, support engineers shouldn't be able to access internal HR, accounting, or payroll systems. At the same time, marketing personnel should not have access to network configuration or applications that they do not use.
2) Validate Third-party Apps and SaaS Solutions
In an increasing multi-cloud and hybrid-cloud environment, it's paramount to understand the s IT ecosystem, third-party APIs (Application Programming Interfaces) and applications, and Software as a Service (SaaS) solutions deployed. Requesting SOC reports from vendors and contractors can help understand how their information systems are maintained and secured.
3) Implement Robust IAM-PAM Solutions
Implementing robust processes around Identity and Access Management (IAM) and Privileged Access Management (PAM) can help strengthen the cybersecurity posture by making it almost impossible for attackers to barge into the organization’s periphery.
4) Train Employees and Customers
'People' are the most valuable asset for any organization but can also be the weakest link in the cybersecurity chain. Therefore, organizations must regularly review the processes around training and educating employees, vendor-contractors, customers, and users to follow basic cyber hygiene.
5) Be Vigilant
Organizations must continue to monitor and audit the control environments. Leveraging automated monitoring and alerting tools can help overcome many challenges SOC teams face.
6) Audit and Review Regularly
Organizations should perform internal audits and review the systems and monitor the traffic and access permission more frequently. It is also advisable to engage third-party audit firms to get an external and independent view of the cybersecurity posture.
7) Communicate Transparently
In case of a security incident, it is essential to be transparent to the employees, customers, vendors, and regulators and communicate with them immediately about the incident. Organizations should also provide specific guidance on how to safeguard the information assets.
To Conclude
The Okta breach shows that no business organization is 100% safe from malicious attacks. One simplest security issue is sufficient for malicious actors to wreak havoc.
In this specific example, the hackers accessed the laptop of one of Okta's customer service engineers to gain vital insights into the company's customer data. Such incidents prove that customers can never be sure that their information is safe and leak-proof.
However, it offers a valuable learning experience that business entities should not ignore the minutest of details regarding network security. It surfaces the adage that ' A chain is only as strong as its weakest link.'
Identity remains the answer to the basic questions: Who are we? Why are we here? What drives us different from others?
But, what’s digital identity? Many people have used this term to relate to core IT services such as access controls, password resets, user directories, and authentication. Identity, on the other hand, is much more than that today.
It has truly become the digital economy's connective tissue. Thanks to the emergence of consumer identity and access management, users can now interface with businesses, technology, and consumers in the most personalized and efficient way possible by providing reliable access and protection across APIs, new sensors and devices (IoT), and intelligent machines.
The Current Competitive Landscape
A landscape has emerged in the past decade, and companies are having to make contingency plans for these changes. In this new landscape, companies not only have to keep up with current business, but also are working to understand a new way of thinking about their customers' identities and behaviors.
Companies need to be able to rapidly develop solutions and infrastructure to explore a problem space, then quickly ramp up if the opportunity turns out to be significant. In making this shift, companies need to consider many factors in addition to simply the technology that's available.
Protect Your Business Data On The Internet
Consumer identity is one of the most important factors in brand building, and it’s a major reason why there are so many identity-driven companies. Part of what makes such companies so successful is their constant attention to customer needs. It’s now more important than ever for companies to understand how consumer identities shape their decision-making processes.
It's not a secret that data is the most valuable asset of modern organizations. Protecting it is critical, particularly as it moves across an organization's infrastructure, applications, and people.
One thing that's often overlooked in this respect is identity management. Small-scale hacks and data breaches are becoming more common every year, and we've seen that there isn't always a clear understanding of how to protect against them. When it comes to protecting information online, many businesses believe that if they're not storing a ton of sensitive information on their servers, they don't have a problem at all. In reality, though, identity management is crucial in protecting yourself against identity theft and other risks related to personal information sharing.
How Important Is Security In An Identity-Driven Company?
Securing your consumer identity is crucial. After all, it is the identities that establish a baseline for which you can employ identity management solutions and offer them the correct level of access to your products and services. With appropriate identity management solutions, integration of user identities, role-based access, authorization, and privilege management, you can reduce the number of accounts in need of password resets.
As customer identity and access management (CIAM) has progressed, the focus of its early days has changed. In the beginning, companies focused on the client's identity. However, with the emergence of cloud computing, companies turned their attention to the customer's identity and driving cloud computing adoption. Nowadays, companies recognize that consumers' identity and security are both important elements to consider in CIAM implementations.
Why Is CIAM So Important?
Retaining customers is key to any consumer-oriented organization. So, the question is how can a consumer identity management system help an organization retain its customers?
One of the main strategies is to create personalized experiences. Ideally, organizations want customers to feel like they are always being taken care of and that they matter. Thus, if a company succeeds in creating personalized experiences for their customers, then they are likely to retain more of their customers.
That’s where the role of customer identity and access management comes into play. It helps organizations manage identities and access rights for customers, employees, and partners.
The benefits of CIAM include:
Improved customer experience by providing a secure and compliant environment for users.
Reduced security risks by automating identity management processes.
Increased efficiency by streamlining the authorization and compliance process.
Just like CIAM being an important factor, SSO is another business-critical solution that provides greater security and compliance.
What About Single Sign-On?
Authenticating multiple applications with a single set of credentials — that’s single sign-on. SSO has become an important identity management keystone of the consumer web, along with mobile identity applications, banks, and government agencies are also using federated identity systems. Some benefits include:
Reduced security risks. With a single credential, users are less likely to enter incorrect passwords into different sites.
Reduced IT costs. SSO can help reduce the number of password changes required by consumers, as well as the time spent managing those changes.
Conclusion
Consumer identity is the reason your company or brand exists. Whether you’re a startup or a long-established business, identity-driven marketing is critical to your success.
Identifying and focusing on your business's consumer identity is a great way to ensure that you stand out in the marketplace. To some people, this might seem like an unnecessary step—but it is actually a vital one.
Being identity-driven means that you focus on the things that make you different from your competition, and use this differentiation to attract and retain customers. By doing this, you can ensure that your business remains successful over the long term.
Today, almost all of our digital identities are linked through devices, apps, and services. Service providers control these digital identities and their respective digital identity data.
Because of this, users are now experiencing misuse of personal data and data breaches that affect their social, financial, and professional lives.
Additionally, giving access to multiple third parties or service providers from different applications makes it harder for users to manage their personal data and revoke access to their information. Users need to own and control their digital identities to address these concerns, preferably from a single source.
A centralized system makes user identity data extremely prone to cyberattacks and privacy breaches. But decentralized identity solutions provide a new horizon by enabling users and service providers to have better authority over their identity and personal data.
This article addresses the following:
What is a decentralized identity?
How decentralized identity works with blockchain
How to authenticate using a decentralized identity
What happens when we fully adopt a decentralized identity procedure?
Benefits of using blockchain with decentralized identity
What is a decentralized identity?
Decentralized identity is based on a trust framework for identity management. It allows users to generate and control their own digital identity without depending on a specific service provider.
For example, digital identities can get approval from multiple issuers such as an employer, a government, or a university that remains stored in a digital wallet called an “identity wallet.” Using the identity wallet, the user (i.e., the identity owner) can present proof of their identity to any third party. The wallet helps users give and revoke access to identity information from a single source, making it easier.
According to Forrester, “Decentralized digital identity (DDID) is not just a technology buzzword: It promises a complete restructuring of the currently centralized physical and digital identity ecosystem into a decentralized and democratized architecture.”
How decentralized identity works with blockchain
The setup of decentralized identity with blockchain typically consists of the following elements:
Identity Wallet: An app that allows users to create their decentralized identity and manage their access to service providers.
Identity Owner: A user who creates their decentralized identity using the identity wallet.
Issuer/Verifier: The person who issues and verifies the identity information. They sign the transaction with their private key.
Service Providers: Applications that accept the authentication using the decentralized identity and access blockchain/distributed ledger to look for the DID that user shared.
Blockchain/Distributed Ledger: A decentralized and distributed ledger that provides the mechanism and features for DIDs and functioning.
DID (Decentralized Identifier): A unique identifier that contains details such as the public key, verification information, service endpoints.
In a decentralized form of identity, an application (an identity wallet) allows users to create their own digital identity. Upon identity creation, the respective cryptographic keys (a public and a private key) are generated.
The identity wallet submits a registration payload with a public key to the blockchain, which generates a unique identifier against your wallet. The private key remains with the user’s device/identity wallet and is used during the authentication.
Similarly, issuers such as the government, universities, and finance institutes verify the respective identity information and add to the digital identity data in a process that is like issuing certificates. The processes, for example, verifying user identity and issuing new credentials, require issuers to sign using their private keys.
How to authenticate using decentralized identity
These are the steps of authentication using decentralized identity and blockchain.
The identity wallet holds verified identity details of the user such as name, age, address, education, employment details, and financial information. This information helps establish trust and makes the user eligible to perform authentication.
The decentralized identity mechanism takes the public key associated with the private key and publishes it onto a distributed ledger such as blockchain.
As the decentralized system provides the public key to the distributed ledger, the identity wallet receives a decentralized identifier (DID). DID is a unique identifier representing the user across the internet.
The user shares this DID with the service provider for authentication.
The service provider looks for the shared DID in the distributed ledger. If found, distributed ledger sends matching data to the application.
The user signs this transaction with the private key to complete the authentication.
The service provider application confirms the authentication success and lets the user perform the actions.
What happens when we fully adopt the decentralized identity procedure?
Let’s assume an online shopping scenario where the required data will transit from the wallet associated with the decentralized identity. The wallet in this scenario contains the verified identity, address, and financial data.
The users share identity data to log in with the website by submitting the required information from the identity wallet. They are authenticated with the website without sharing the actual data. The same scenario applies to the checkout process; a user can place an order with the address and payment source already verified in his identity wallet.
Consequently, a user can go through a smooth and secure online shopping experience without sharing an address or financial data with an ecommerce website owner.
5 benefits of leveraging blockchain
Trustworthy: Blockchain technology uses a consensus approach to prove the data authenticity through various nodes and acts as the source of trust to verify user identity. Along with the data, each block also contains a hash that changes if someone tempers the data. These blocks are a highly-encrypted list of transactions or entries shared across all the nodes distributed throughout the network.
Data Integrity: The blockchain-based data storage mechanism is immutable and permanent, and hence, modification and deletion are not possible. The decentralized identity systems use this mechanism so that no external entity can tamper or modify the data.
Security: Another crucial reason for leveraging the blockchain in decentralized identity systems is to provide robust security. The blockchain system features an inherent design by maintaining data in a highly encrypted fashion. The blockchain also caters to digital signatures, consensus algorithms, and cryptographic hash functions to protect user identities from breaches and thefts.
Privacy: Decentralized identity systems leveraging blockchain with a pseudo-anonymous identifier (decentralized identifier) can help mitigate the privacy concerns among the identity owners.
Simplicity: Identity issuers leverage the seamless process of issuing digital identities. Identity verifiers can efficiently onboard new users and conduct the information verification process. Identity owners can effortlessly store and manage their identities within the identity wallet.
Conclusion
From all the above facts, it is evident that decentralized identity with blockchain can completely transform the digital identity landscape. It will make digital identity management decentralized and seamless, as no particular organization will govern the user data.
More importantly, users will be able to easily authenticate themself without sharing their sensitive personal information with third parties.
Third-party APIs are being used everywhere. However, as an increasing number of enterprises adopt and utilize third-party APIs, how do they ensure API security?
Today, software and web development teams and enterprises are increasingly becoming somewhat dependent on some type of open source code, outsourced development, commercial-off-the-shelf (COTS) software, or some other form of outsourced development resources. And third party APIs, extensions, and applications are no different.
According to experts, at least 55% of global companies utilize third-party APIs to boost their organizational revenue. However, where using such third-party APIs can offer many benefits and features, it can also pose a myriad of security challenges for the development teams and organizations. Continue reading the article as we take a deep dive into the subject.
What Are Third-Party APIs?
Third-party APIs, extensions, and applications are special pieces of software, codes, or protocols provided by a third-party company to you for a specific purpose. Third-party APIs or applications work by providing a specific service or a set of features and functionalities that you do not have the resources to develop.
You can integrate pre-developed third-party APIs and extensions offered by different companies into your specific organizational infrastructure. For example, you can use Google’s Map API to integrate map features into your business website. Similarly, web and software developers can also use various pre-built third-party APIs to speed up the development process.
What is API Security?
Third-party web APIs can access sensitive data/information which can increase security risks such as data breaches. Malicious web APIs can be malware-infected and can corrupt a whole web project and can cause other far-reaching complications. API security means taking necessary steps and deploying specific security evaluation criteria to determine if a third-party API poses any security risks to a development project or organizational assets.
Why is Third Party API Security important?
Third-party API cybersecurity risks pose a serious threat to the very existence of businesses and development projects. A single malicious third-party API can infiltrate the organizational security parameters and can bring down the whole organization’s infrastructure. Similarly, a fraudulent third-party API can also abuse its access and privileges and can secretly steal and misuse sensitive information or can even do worse.
Cybercriminals are also evolving with time and technology continues to progress. Today’s modern cybercriminals can also exploit a security vulnerability that may exist in a third-party application or API being used by your organization. Adversaries can use a vulnerable API as an entry point to execute a large-scale attack. Experts have reported that 51% of organizations have experienced a data breach caused by malicious third-party APIs and applications. The consequences of a breach caused by such APIs can include but are not limited to the following:
Data breach.
Process/services/operations corruptions.
Network downtimes.
Malware infections.
Revenue loss.
Compliance issues.
Project failures.
Asset damage.
Legal complications and more.
In addition to the above-mentioned, there can be other delayed complications accompanying a security incident caused by fraudulent third-party apps, APIs, and extensions. So how do you ensure third-party API cybersecurity? Continue reading as we share with you the top 5 ways you can evaluate third-party APIs to ensure security.
1- Making inventory and testing the APIs
How do you reduce the security risks of third-party APIs? You test them! Conducting beta testing of multiple third-party APIs can enable you to determine how a certain API performs in comparison to the others and can allow you to make informed decisions.
One of the most efficient ways to approach this is by making an inventory or a list. Make a list of all reputed third-party vendors and service providers that you can find online. Next, start by classifying them according to their impact level. Impact levels represent the level of access and control an API requires in order to perform. The more an API requires access to your organizational assets, the more level of impact/threat it poses.
The level of impact can be classified into; High, Medium, and Low. Determine what level of risk your organization is willing to accept and choose an API according to your acceptance criteria.
2- Assigning responsibilities and patching vulnerabilities
Who is responsible for patching the security vulnerabilities in third-party API? Does your organization have a dedicated IT or security team? You must never partner up with a third-party vendor if they do not provide regular security updates for their APIs or web extensions.
Assign appropriate team members to investigate and validate a particular third-party API is being maintained by the vendor appropriately. The assigned team should also evaluate the level of data and other assets accessed by the API and how the organization should react if the data accessed by the third-party API is misused. Developing a third-party incident response plan can help your organization deal with unexpected situations caused by malicious third-party APIs.
3- Investigate the API and the Vendor
Before partnering up with a third-party API vendor or before using a free API, it is always a best practice to ask specific questions from the vendor to get specific information and answers. It is imperative to investigate how a third-party API collects information, where it is stored, how it is being used by the vendor, and what specific security measures have been taken by the partnered vendor to secure the collected data and information.
Asking such questions can help you gather actionable information and make informed decisions to determine whether a third-party vendor has reliable security parameters in place to handle your organizational data/information or not.
4- Establish Zero-Trust cybersecurity policies
When it comes to organizational security, trust no one. That includes third-party API vendors and your organizational employees. 95% of security breaches are caused by negligent employees and human mistakes. Therefore, develop strict zero-trust cybersecurity policies that include compact cybersecurity rules and procedures for both your third-party vendors and your employees cooperating with them.
In order to ensure a cybersecurity culture in your organization, you must develop cybersecurity policies that do not just address third-party security procedures, but also educate and motivate your employees to develop a cybersecurity-conscious mindset. This will help your employees to develop a security-first mindset and will potentially lower the risks of employees making mistakes or implementing poor security practices.
5- Limit access and privileges
Consider deploying a privileged access management solution to make sure that only legitimate users can access your company’s sensitive information. Secure your critical assets with two-factor authentication (2FA) to make it harder to compromise your organizational network even if someone’s credentials are stolen. One-time passwords and manual access approval also can help you prevent attackers from entering your network.
How to choose a secure API and a secure API Vendor for your organization?
How can you choose a secure third-party API for your organization? What elements should you look for while choosing a third-party API? The key metrics on which you may want to evaluate the security and functionality of a specific API may differ from business to business depending on a company’s security requirements and the end goals. However, in order to maximize your chances of choosing a secure third party API compare and evaluate a third party API against the following aspects:
Reputation: If a third-party API has no verifiable vendor details or a competitive digital footprint, then it is better to choose another API that is offered by a reputed vendor such as Google, Amazon, or Microsoft.
Security: Does an API have appropriate security controls? Run a security check by using third-party security testing tools or refer to the API documentation to verify the API security capabilities. If an API offers encryption capabilities, go for it!
Compliance: Integration of a third-party API or extension can cause compliance issues and may require you to produce additional documentation. Do not use a third-party API that comes with a compliance void warning.
Updates and patches: Always choose a third-party API that is regularly updated and patched by the vendor. APIs that are updated regularly perform well and are less vulnerable to security threats.
Review the documentation: Third-party API vendors may reveal gruesome details in the API documentation that may otherwise not be visible on their official websites. Always review an API’s documentation to ensure that everything mentioned in the documentation is digestible and does not raise any red flags and alarms.
Compare third-party APIs against international security standards: There are several international standards and commonly used cybersecurity frameworks that can serve as a basis for outlining your third-party risk management strategy. Examples include:
Consider Third-party vendor risk management:Third-party risk management (TPRM) can help you mitigate potential cybersecurity threats and manage third-party risks. TPRM solutions offer efficient detection, containment, and mitigation of potential third-party security risks while also boosting the performance and productivity of your overall organization.
As developers and businesses continue to rely on various third-party APIs, applications, and extensions, it is imperative that the legitimacy and security of the APIs be ensured in order to minimize potential security risks and unwanted situations. Careful evaluation of the third-party APIs and the third-party vendors is the key to making informed decisions.
Deepak Gupta
