We live in a digital world where passwords are no longer enough. Every day, we carry out transactions, access services, and share personal data online. With greater convenience comes greater risk: fraud, phishing, social engineering, deepfakes, and AI-driven attacks are becoming increasingly sophisticated—especially in regulated sectors such as banking, healthcare, and mobility.
In this landscape, two major players have emerged in modern authentication: Passkeys and Verifiable Credentials (VCs). Both promise a passwordless future, but with different approaches.
The inevitable question is: which one is the better solution to protect our digital identity?
Passkeys: Goodbye to Passwords
Passkeys are credentials designed to replace traditional passwords. They rely on asymmetric cryptography and use your device as proof of possession. On-device biometrics (such as Face ID) enable smooth, frictionless access, and when biometrics are not available, a six-digit PIN can be used instead. This makes them phishing-resistant and highly convenient: a simple touch and you’re logged into the app or platform.
Key benefits:
- Eliminate the need to remember complex passwords.
- Reduce the risk of phishing attacks and credential theft.
- Fast and easy to use across multiple devices when synchronized via the cloud.
However, they are not a complete solution. While passkeys are secure and convenient, they do not verify a user’s real identity. They confirm that the device belongs to you, but they cannot guarantee that the person behind it is who they claim to be. Additionally, if the cloud infrastructure used to synchronize passkeys is compromised, there may be a risk of exposure.
In short, passkeys are excellent for fast and secure access, but insufficient for full identity assurance.
Verifiable Credentials: The Digital Proof of Who You Are
This is where Verifiable Credentials (VCs) come into play. A VC is a cryptographically signed digital document that contains identity attributes such as name, date of birth, age, licenses, or certifications. Unlike passkeys, identity verifiable credentials (such as a Photo ID or mobile driver’s licenses) are primarily designed to verify a user’s real identity, ensuring that the person interacting digitally is who they claim to be.
When combined with advanced biometric authentication (not only on-device biometrics like Face ID, but also processes where biometric verification is performed and validated through independent channels), VCs enable Strong Customer Authentication (SCA) with a high Level of Assurance (LoA). This approach is essential to comply with regulations such as eIDAS 2, PSD3, or AML5, where authentication alone is not sufficient—identity must be demonstrated with reinforced guarantees.
Consider a real-world example: applying for a loan online. With a Photo ID issued as a VC, a bank can verify your identity digitally without requiring physical documents or passwords. The entire process is secure, reliable, and auditable.
Key benefits:
- Real identity verification
- Regulatory compliance in highly regulated sectors
- Protection against digital fraud and identity impersonation
Verifiable Credentials allow organizations to authenticate users while reliably verifying their digital identity. They are an ideal solution when a high level of assurance and regulatory compliance is required, providing traceability and verifiable evidence in every interaction.
Facing Modern Threats: Phishing, Social Engineering, and AI-Driven Fraud
Digital security is no longer just about protecting passwords. Today, the main attack vectors are phishing and social engineering, increasingly sophisticated thanks to generative AI. Deepfakes, synthetic identities, and intelligent automation amplify these attacks, making impersonation attempts more convincing.
Here, both Passkeys and VCs excel because they are based on public key cryptography. This makes them essential tools for securing remote transactions in digital banking, healthcare, and mobility, where trusted identity is critical.
The future will be passwordless and trust-centric: not only will we eliminate passwords, but we will also ensure that every digital access is legitimate and verifiable.
Digital Identity with Comprehensive Protection
If anything demonstrates the evolution of Passkeys and Verifiable Credentials, it’s that digital security can no longer rely on a single layer. Fraud is evolving—especially phishing and social engineering, now amplified by AI: more convincing impersonations, large-scale automation, and attacks designed to exploit the human factor. The response cannot be piecemeal. It must be end-to-end.
At Facephi, we understand digital identity as a complete process: from initial user verification to continuous authentication and proactive fraud detection. That’s why we focus on comprehensive protection based on multiple security layers, where verified identity, passwordless authentication, and advanced behavioral analysis work together.
It’s not just about granting access—it’s about ensuring every digital interaction is backed by verifiable identity, traceability, and, when required, VCs can also serve as a transaction record (e.g., in AP2 schemes), providing cryptographic evidence that reinforces trust and regulatory compliance.
Conclusion
If you want to improve user experience while ensuring regulatory compliance and protection against modern threats, the right strategy is not choosing between Passkeys and Verifiable Credentials. The right strategy is to integrate them:
- Passkeys: for low or substantial authentication levels, eliminating passwords.
- VCs: enable high authentication levels when reinforced identity verification and regulatory compliance are required.
By combining both, you achieve digital authentication that is resilient to modern attacks and trust-centered—exactly what businesses need to lead in the digital era.
The combination also provides greater flexibility, allowing authentication and verification levels to be adapted to context, risk, and applicable regulatory frameworks, combining different factors as needed to reach the required assurance level.