Fraudsters of Lemmy, how would you commit fraud if governments embrace cryptography

I saw this tiktok where this guy was talking about how he'd get his hands on real social security numbers.. this was a clip from a whole story he told about some criminal shit, I was too distracted by my thoughts on how to fix the exploits he used.

Block chains and cryptographic signatures would solve basically every one of his exploits. But regardless of the myriad of reasons as to why we won't adopt cryptography into American laws and bureaucracy, imagine if we did do everything involving government and policy in a cryptographically secure environment.

Imagine if everyone who is born gets assigned a gpg secret key signed by the government and that is your government ID for everything from opening a bank account to paying your taxes to claiming benefits. IMPO I think this is a perfect solution (iif you ignore the human element).

So my question is why wouldn't it be perfect, and what kind of exploits could bad actors use in a cryptographic bureaucracy?