# Verifiable Credentials & SD-JWT Source: https://startwithidentity.com/standards/verifiable-credentials/ Last updated: 2026-10-16 License: content by Start with Identity. Cite the source URL. --- ## What it is A Verifiable Credential (VC) is a cryptographically signed, tamper-evident digital credential that follows the [W3C VC Data Model](https://www.w3.org/TR/vc-data-model-2.0/). It is the data format at the heart of [decentralized identity](https://startwithidentity.com/guides/fundamentals/what-is-decentralized-identity/): a portable, machine-verifiable version of the paper and plastic credentials people carry today, from a diploma to a driver's license to a proof of employment. The model defines three roles, the [issuer, holder, verifier](https://startwithidentity.com/glossary/issuer-holder-verifier/) trust triangle: - An **issuer** signs a credential and gives it to a subject. - A **holder** keeps it in a [wallet](https://startwithidentity.com/glossary/digital-wallet/) and controls when to present it. - A **verifier** checks the signature, the issuer, and the credential status, without calling back to the issuer. **SD-JWT** (Selective Disclosure JWT) is the IETF token format increasingly used to carry these credentials in a way that supports [selective disclosure](https://startwithidentity.com/glossary/selective-disclosure/). ## How it works - **Issuance (issuer to holder):** an authority issues a signed credential to the user's wallet. Keys are often anchored by a [decentralized identifier (DID)](https://startwithidentity.com/standards/decentralized-identifiers-did/), so the verifier can resolve the issuer's public key without a central registry. The [OpenID4VCI](https://startwithidentity.com/glossary/openid4vci/) protocol standardizes this exchange. - **Presentation (holder to verifier):** the holder assembles a [verifiable presentation](https://startwithidentity.com/glossary/verifiable-presentation/) and shares only what is needed. With selective disclosure they can prove they are over 18 without revealing their birth date. [OpenID4VP](https://startwithidentity.com/glossary/openid4vp/) standardizes the request and response. - **Formats:** the two dominant credential formats are **SD-JWT VC** (JWT-based, favored by eIDAS 2.0 and IETF work) and **W3C VC with Data Integrity proofs** (JSON-LD, often paired with [BBS signatures](https://startwithidentity.com/glossary/bbs-signature/) for unlinkable disclosure). [AnonCreds](https://startwithidentity.com/glossary/anoncreds/) is a third format common in ledger-based ecosystems. - **Revocation:** issuers publish status through a [revocation registry](https://startwithidentity.com/glossary/revocation-registry/) or status list so a verifier can tell whether a credential is still valid. ## Status The W3C published the **VC Data Model 2.0** family as Recommendations in May 2025. **SD-JWT** and **SD-JWT VC** are active IETF drafts (SD-JWT VC reached draft-19 in August 2026 and has been submitted to the IESG for publication) and are referenced directly by EU digital identity work. The [OpenID for Verifiable Credentials](https://startwithidentity.com/standards/openid4vc/) protocols reached a High Assurance Interoperability Profile 1.0 Final in December 2025. Adoption is accelerating through [eIDAS 2.0 and the EUDI Wallet](https://startwithidentity.com/standards/eidas-2-eudi-wallet/) and [mobile driver's licenses](https://startwithidentity.com/standards/iso-18013-5-mdl/). ## When to use it Reach for verifiable credentials when you need **reusable, portable proof** that a holder controls: verify once and reuse many times, with the user deciding what to share. The strongest current use cases are reusable identity verification and [KYC](https://startwithidentity.com/guides/decentralized-identity/reusable-identity-and-kyc-with-verifiable-credentials/), government and cross-border ID, and workforce credentials such as certifications that should survive a job change. For plain workforce SSO, mature [federated protocols](https://startwithidentity.com/standards/openid-connect/) are still the right tool. ## Pitfalls - The ecosystem is still consolidating; interoperability depends on shared profiles like [OpenID4VC](https://startwithidentity.com/standards/openid4vc/) and HAIP rather than the base data model alone. - Revocation, wallet recovery, and issuer governance are the hard parts, not the signing. - Format fragmentation (SD-JWT VC vs W3C Data Integrity vs AnonCreds) means you must pick formats your verifiers actually accept. ## Related Guides: [what is decentralized identity](https://startwithidentity.com/guides/fundamentals/what-is-decentralized-identity/), [verifiable credentials implementation guide](https://startwithidentity.com/guides/decentralized-identity/verifiable-credentials-implementation-guide/). Standards: [DID](https://startwithidentity.com/standards/decentralized-identifiers-did/), [OpenID4VC](https://startwithidentity.com/standards/openid4vc/), [mDL](https://startwithidentity.com/standards/iso-18013-5-mdl/). Glossary: [verifiable credential](https://startwithidentity.com/glossary/verifiable-credential/), [SD-JWT](https://startwithidentity.com/glossary/sd-jwt/), [verifiable presentation](https://startwithidentity.com/glossary/verifiable-presentation/). Vendors: [decentralized identity](https://startwithidentity.com/vendors/decentralized-identity/). ## Who wrote it [Manu Sporny](https://startwithidentity.com/experts/manu-sporny/) kickstarted the W3C work behind verifiable credentials and co-created JSON-LD underneath it. Selective disclosure rests on [Daniel Fett](https://startwithidentity.com/experts/daniel-fett/)'s SD-JWT and on BBS signatures, co-edited by [Tobias Looker](https://startwithidentity.com/experts/tobias-looker/) and built on the BLS scheme co-authored by [Dan Boneh](https://startwithidentity.com/experts/dan-boneh/). More in the [experts directory](https://startwithidentity.com/experts/).