Turkey upgrades digital ID; AI projected to stifle breaches

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Turkish authorities have confirmed plans to double down on national digitization efforts by leveraging blockchain technology for its digital identity system.

The latest efforts follow authorities’ previous efforts to onboard Turkish residents on T.C. Kimlik Karti, a national identity program with digital features. Since its launch in 2017, over 83 million individuals have received smart digital ID cards, with less than two million persons yet to be captured.

Turkish regulators are keen on onboarding the next tranche of residents on the national ID program in what appears to be a concerted effort. The country’s Civil Registration and Vital Statistics (CRVS) system and the Scientific and Technological Research Institution of Turkey (TUBITAK) are joining the fray to improve the offering.

Regulators are linking national digital IDs to public and private services to increase their appeal. Holders of digital IDs will have access to key services like healthcare facilities, voting services, social security perks, and travel documentation.

Apart from providing access to essential services, the cards come retrofitted with chips that are intended to store a range of biometric information and personal data. As an added layer of protection, the digital ID system leans on blockchain to ensure privacy and transparency.

According to a government disclosure, TUBITAK will take the lead on infrastructural development in line with global best practices. With privacy and security at the top of the pyramid for Turkey, officials are optimistic that even the sternest skeptics will see the upsides of the digital ID system.

The private sector has its sights set on the developments related to the digital ID program with Colle AI hinting at a potential integration of the system into its non-fungible token (NFT) project. Colle AI’s ambitious project involves the use of artificial intelligence (AI) to simplify the processes for making digital collections.

Other firms are poised to join the melee, with executives citing the benefits of blockchain’s interoperability with legacy and next-gen systems. Potential adopters of the digital ID system are expected ecosystem players in the healthcare, finance, AI, and education verticals.

Complying with regulations

As the country welcomes new digital asset regulations, service providers in the industry are keen on integrating the ID system into their existing processes. The incoming rules spell out stringent identity verification for transactions above $400 while unregistered wallets face higher levels of scrutiny from officials.

Recent digital currency adoption metrics have piqued the interest of regulators with the government keen on tightening its control over the sector. Outside of digital assets, Turkey is looking at a national digital transformation project that combines AI, blockchain, Big Data, and Internet of Things (IoT) technology.

AI in cybersecurity

In other news, decentralized finance (DeFi) proponents opine that the industry’s next big leap forward is the widespread integration of AI tools to protect users after jarring metrics from 2024.

Web3 cybersecurity firm Peckshield stated in its report that the digital currency sector lost over $3 billion worth of assets to bad actors in 2024, evenly split between DeFi and centralized finance (CeFi) players. A large chunk of the stolen funds stems from digital currency investment scams, while others result from hacks and security breaches.

Peckshield stated that the sector is poised for AI-backed security measures to counter the activities of bad actors in 2025. Rather than relying on mainstream AI tools for security measures, ecosystem participants will turn to tailor-made cybersecurity services powered by AI.

“AI and machine learning are becoming game-changers for identifying threats – imagine having smart systems that can spot suspicious activity in smart contracts before anything goes wrong,” said DWF Labs’ partner Lingling Jiang.

Previously, AI-based solutions were addressed unevenly, but Jiang argues that the future will see a broad-based approach with security “woven into every transaction.”

The applications are far-reaching, with experts pointing toward early warning systems for potential vulnerabilities and AI-powered postmortems for breaches. Platform users will be given real-time AI-generated information on potential honeypots and rug pulls to protect them from bad actors.

While offering an added layer of protection, experts argue that the ecosystem will still be “adversarial” given the advanced nature of scams and breaches. However, pundits say that only the combination of AI and global coordination will move the needle in favor of users against rampaging bad actors.

Satlayer CEO Luke Xie remarks that a concerted global effort at regulation will require a level of tradeoffs of security for privacy. Xie added that the anonymous nature of DeFi protocols might render Know Your Customer (KYC) and Anti-Money Laundering (AML) rules redundant in the ecosystem.

By the numbers

Digital currency-related breaches reached their peak in 2024, with total losses climbing as high as $3.1 billion in a calendar year. The figures from 2024 are a 15% increase from the 2023 metrics, but several denominators can be gleaned from both figures.

Hacks contribute a chunk of the pilfered funds, while romance, investment, and pig-butchering scams make up the rest. According to Peckshield, nearly $500 million worth of digital assets were recovered, underscoring increased global collaboration and advanced on-chain monitoring techniques.

In order for artificial intelligence (AI) to work right within the law and thrive in the face of growing challenges, it needs to integrate an enterprise blockchain system that ensures data input quality and ownership—allowing it to keep data safe while also guaranteeing the immutability of data. Check out CoinGeek’s coverage on this emerging tech to learn more why Enterprise blockchain will be the backbone of AI.

Watch: Why identity is important as we move to Web3