The architecture of the Karat Network consists of several key components that work together to deliver a decentralized identity solution. These components are:

I. Application Layer

Developers can build various DApps to acquire, utilize, and facilitate the fair usage of users’ identities and data. Karat will be the first to launch a marketing DApp for acquiring user’s Web2 social ID, such as email address and Twitter handle, for targeted marketing

II. Access Control Layer

Smart Contracts are used to grant access to view and interact with user data. Users can utilize the contract to set permission rules and create allowlists. It is designed so that no one, including Karat, has the privilege to access user data without permission.

III. Encryption/Decryption Layer

Identity data is kept secure and encrypted with Karat Network. The encryption process is decentralized, powered by Threshold Cryptography and Lit Protocol.

IV. Data Storage Layer

Karat uses Ceramic to store user identity data. Decentralized storage solutions such as Ceramic and IPFS ensure the data is stored in a distributed manner.

Architecture

                      Architecture

The Role of Threshold Cryptography in Encrypting and Decrypting Data

Karat Network utilizes Lit Protocol to provide a decentralized approach to encrypting and decrypting data. With traditional methods, a single entity holds the key to encryption, making it a centralized and trusted entity. It's akin to a simple lock and key system. Lit Protocol takes a different approach by utilizing the concept of threshold cryptography, which breaks the key into smaller pieces and distributes it to different nodes. This means that no singular node holds executive authority. Instead, consensus must be reached among the nodes to sign or decrypt data. As a result, the private key of the key pair never exists in its entirety and is instead distributed across the nodes, providing a more secure and decentralized approach to encryption and decryption.

The use of Multiparty Computation (MPC) technology and threshold cryptography is gaining traction among projects aiming to decentralize their protocols. Wallets are using MPC to decentralize control, while Chainlink Oracle integrates Threshold Signatures to sca. SSV network, a popular liquid staking protocol similar to Lido, also leverages the MPC threshold scheme.

How Karat Network Ensures Interoperability with Other DID Networks

Karat Network ensures interoperability with other Decentralized Identity (DID) networks through its implementation of the DID standard. DID, or Decentralized Identifier, is a decentralized identifier specification developed by the World Wide Web Consortium (W3C) that provides a unique and secure identifier for entities on the internet. The DID standard is platform agnostic, meaning it is not tied to any specific technology or blockchain.

Contract Interaction Block Diagram:

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