People sometimes use “digital wallet” and “digital credential” interchangeably. Confusing them makes it hard to answer basic questions: who is responsible if something goes wrong, whether a credential works in another app, and whether trusting the app means trusting what is inside it. For agencies choosing infrastructure and residents choosing an app, the line between container and contents is worth drawing clearly.
Start with the object in your pocket. A leather wallet holds a driver’s license from the DMV, a payment card from a bank, and an insurance card from an insurer. The wallet did not issue any of them. It stores them, keeps them together, and lets you take out the right one at the right time. The cards carry their own authority; the wallet carries the cards. Digital identity works the same way.
A verifiable digital credential is a cryptographically signed, verifiable data object issued by an authority that makes claims about a person. The W3C Verifiable Credentials Data Model 2.0, now a full W3C Recommendation as of May 2025, defines a verifiable digital credential as “a tamper-evident credential whose authorship can be cryptographically verified,” a specific way to express a set of claims made by an issuer, such as a driver’s license or an education certificate. A mobile driver’s license under ISO/IEC 18013-5 is the same idea in a different format: a signed digital document provisioned by the issuing authority, verifiable against that authority’s keys.
What makes it a credential is the signature, not the app it lives in. The issuing authority (a DMV, a vital records office, a university) signs the data with a private key it controls. Anyone verifying the credential checks that signature against the issuer’s published key. If the data has been altered by a single character, the signature fails. This is why a credential is designed to carry its own trust: the proof travels with the data. For a full walkthrough of that process, see how verifiable digital credentials work.
A digital wallet is holder software: the app that stores credentials, protects the keys, manages consent, and presents the right data when asked. In the ISO/IEC 18013-5 model, the holder accesses their mobile driver’s license through a downloadable application container, a wallet, approved by the issuing authority. The W3C model calls this role the holder: an entity that possesses one or more verifiable digital credentials and generates presentations from them.
The wallet’s responsibilities are real but different from the credential’s. It stores credentials securely, protects the private keys that bind a credential to the device, and enforces consent, ensuring nothing is shared without the resident's approval. It shapes what a good presentation flow looks like: which fields to reveal, how to show a request, and how to say no. A well-built wallet is where citizen-centric wallet design lives, because usability and privacy are properties of the app, not the credential. The question of who should build that software, whether an agency, a vendor, or an off-the-shelf provider, is its own decision, covered in Who Should Build a Digital Wallet.
Issuers create credentials; wallet builders create the software that holds them. These are separate parties with separate responsibilities. The private key that signs a credential belongs to the issuing authority and stays in its infrastructure. A separate key, the one that verifies the credential is being presented from the correct device, is generated and protected on the resident’s phone, typically in secure hardware, and is not intended to leave. The wallet manages that device key, it does not hold the issuer’s signing key.
This separation is what allows a single wallet to hold credentials from multiple issuers. Because each credential carries its own issuer signature, a single app can store a driver’s license, a professional license, and a benefits credential from three different agencies without any of them trusting the wallet to vouch for the others. NIST’s current digital identity guidelines, SP 800-63-4, finalized in July 2025, describe a specific form of multi-factor cryptographic authentication as a subscriber-controlled wallet on the subscriber’s device, used together with a federation process to provide the security characteristics required of an authenticator. The binding is in the credential and its cryptographic material, not the container.
Trusting the app is not the same as trusting the data inside it. A wallet can be well-designed, certified, and secure, and still hold a credential from an issuer you have no reason to trust. Likewise, a trustworthy credential can sit in an app that handles it poorly. Both layers need their own assurance. Issuer signatures establish that a credential is authentic and unaltered. Certified wallets, apps that meet a certification, attestation, and security bar, help establish that the software protects keys, enforces consent, and presents data honestly. A verifier checks the issuer’s signature regardless of which app presented it.
The two objects differ on every relevant criterion. A digital credential is a signed, verifiable data object, governed by standards such as ISO/IEC 18013-5 and the W3C VC Data Model, created by an issuing authority such as a DMV, dependent on the issuer’s signing key, and trusted because of the issuer’s cryptographic signature. A digital wallet, by contrast, is holder software (an app), governed by certification, attestation, and UX requirements, created by an agency or wallet vendor, dependent on a device key on the resident’s phone, and trusted because of certification and secure design.
The California DMV Wallet, built by SpruceID with open-source software, shows the split in practice. The app supports both the ISO mDL and W3C Verifiable Credential formats, so it can hold multiple types of credentials rather than locking residents into a single format. Because the credential’s trust lives in the issuer’s signature, a standards-based mobile driver’s license can be verified by a relying party that never installed the resident’s specific app. That is the foundation of decentralized digital identity and of credentials that can travel across agencies and state lines.
When the container and its contents are kept separate, residents gain choice: a credential is not tied to a single app, and a wallet is not limited to a single issuer. Keep the two ideas distinct, and the practical questions become easier to answer: the credential proves the facts, and the wallet protects how those facts are held and shared. For a related comparison, see the difference between a physical ID card and a verifiable digital credential.
Keeping the wallet-versus-credential distinction clear in practice, rather than just in explanation, is what allows one wallet to support multiple issuers and formats without locking residents in. SpruceID helped build the California DMV’s mobile wallet as open-source, third-party-neutral software, and it works across both mDL and W3C credential formats, giving it direct experience in separating the container from the contents at the architecture level. If your agency is planning a wallet or credential infrastructure, get in touch with our team.
About SpruceID: SpruceID builds digital trust infrastructure for government. We help states and cities modernize identity, security, and service delivery — from digital wallets and SSO to fraud prevention and workflow optimization. Our standards-based technology and public-sector expertise ensure every project advances a more secure, interoperable, and citizen-centric digital future.
