Verifiable Credentials-Based Decentralized Master Data Management in Data Spaces

Abstract

The importance of trustworthy, interoperable data spaces has become a strategic priority for business, administration, and research. Efficient master data management is a key prerequi- site for their successful operation. However, increasing connectivity of heterogeneous actors, regulatory requirements, and high demands on data quality, data sovereignty, and transparency are pushing existing, centralized master data management approaches to their structural limits. In federated data ecosystems in particular, redundant data storage, manual verification processes, and a lack of trust mechanisms lead to increased effort, limited scalability, and reduced interoperability. Against this back- ground, the use of verifiable, cryptographically secured credentials is becoming increasingly important in order to establish trust between organizations without central data pooling or unnecessary disclosure of sensitive master data. The project Verifiable Credentials for Master Data Sovereignty (VC4MDS) addresses these challenges by introducing a verifiable creden- tial-based approach to decentralized master data management in data spaces. Building on self-sovereign identity standards, VC4MDS enables the exchange of master data attributes as verifiable credentials, ensuring data qual- ity, timeliness, and validity while supporting data sovereignty and selective disclosure. The following report provides a systematic overview of the conceptual, technical, and economic potential of this approach and demonstrates how VC4MDS can be integrated into existing data space architectures and operated sustain- ably. It highlights both utilization models as well as governance and adoption aspects in order to demonstrate the potential of VC-based master data management as a key component of future, trustworthy data ecosystems.