Passkeys have spent the last few years moving from an emerging authentication method to something consumers increasingly encounter. For businesses, the question is no longer whether passkeys work, but how to drive adoption, handle recovery, manage fallbacks and make them work across real customer journeys.
Digital identity credentials are now approaching an earlier point on a similar curve. Government-issued digital IDs, mobile driver's licences and wallet-based credentials are becoming more common, giving people new ways to present verified information.
For product and identity teams, the opportunity is not to choose between passkeys and digital credentials. It is to understand where each belongs before customer expectations, regulation or platform adoption makes that decision urgent.
Passkeys prove access. Digital credentials prove attributes
Passkeys answer a specific question: can this person securely access this account? They remove the shared secret behind passwords and provide phishing-resistant authentication without adding unnecessary sign-in friction.
Digital identity credentials answer a different question. They can establish a verified fact about a person, such as identity, age, entitlement or another attribute issued by a trusted source.
That makes them useful at different moments. A returning customer may only need a passkey, while a new customer opening a regulated financial product may need verified identity information. An age check may only require proof that a threshold has been met, not a complete identity record.
Authentication and identity evidence are no longer tied to the same interaction. That gives businesses more choice in how much proof they ask for.
What passkeys taught us about adoption
Passkeys have already shown that practical adoption brings harder questions. As adoption grows, the questions shift from whether a method can be supported to how it should work across enrollment, recovery, device changes, fallbacks and the wider customer journey.
Digital credentials will bring their own version of those questions. Where should a credential be requested? What attributes are actually needed? What happens when a customer does not have one? What happens when a customer has a credential but is unable to present it? How should the experience work across the app, website or contact centre?
These decisions shape the customer journey and the wider identity architecture. They are not just questions for the team implementing the integration.
The next challenge is connecting the journey
Consider a new banking customer. During onboarding, a digital credential could provide the verified information required to establish an account and perform a biometric identity verification, while a passkey can then support secure, phishing-resistant access.
From there, the two can be used differently as the context changes. A returning customer may only need a passkey, while an unusual recovery attempt, regulated action or higher-risk interaction may justify bringing verified identity back into the journey.
That flexibility matters because customers have little patience for security checks that feel unnecessary. If every sign-in, transaction or account change becomes another request for identity evidence, stronger security quickly starts to feel like a worse product.
When identity is working well, much of that complexity should be invisible. Customers should move through lower-risk interactions without thinking about the authentication or verification happening underneath, while stronger checks appear when there is a clear reason for them.
This is where passkeys and digital credentials are better together: strong authentication where authentication is enough, verified identity where more assurance is required, and less friction everywhere else.
Why businesses should be preparing now
Digital credentials are earlier in their adoption curve than passkeys, but the direction is clear. As digital wallets and verifiable credentials become more widely available, businesses will increasingly need to decide how they fit into customer journeys.
The lesson from passkeys is not to wait until adoption turns preparation into a deadline. Once adoption accelerates, the conversation moves quickly from technical support to customer experience, recovery and operational consistency. Teams that wait until digital credentials become a regulatory requirement or customer expectation risk solving those questions under pressure, with less room to get the journey right.
For teams preparing for that shift, Authsignal's Digital Credential Verification is designed to drop into the identity stack you already have, so you can accept and verify wallet-based digital credentials without rebuilding your existing authentication architecture.
See how Digital Credential Verification works with Authsignal
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