Oasis Labs, the privacy-focused blockchain cloud-computing platform, and Equifax Inc. today announced a partnership to build a “Know Your Customer” identity management platform for companies seeking to enter into the Web3 and blockchain industry.
Web3 refers to what experts call the next iteration of the World Wide Web, or the decentralized web, which is built on blockchain technology and allows for pseudonymous peer-to-peer financial transactions using cryptocurrencies such as bitcoin and Ethereum.
Massive scale economies have risen up within Web3 based on blockchain tokens, with the global cryptocurrency market cap exceeding one trillion, according to CoinMarketCap. Bitcoin’s market cap is approximately $400 billion with Ethereum at approximately $190 billion.
These cryptocurrencies alone represent only two of the tokens that people trade within decentralized finance apps, which is a much broader ecosystem that eschews centralized systems such as banks and financial institutions while providing finance features such as loans, interest-bearing accounts, securities trading, investments and more.
However, most users of Web3 interact with pseudonyms or usernames, and this means that Web3 companies, protocols and even traditional companies interested in operating legally need to comply with local regulations. To do so they must comply with regulations such as anti-money laundering and “Know Your Customer,” or KYC, which requires knowing the identity of users. This is where Equifax comes in and provides its expertise into making certain that everyone who uses a given platform is properly identified and establishes trust between all transacting parties while still ensuring their privacy.
To do this, Equifax will provide its Digital Identity Trust and Secure Multi-Factor Authentication solutions in order to verify users in order to ensure compliance. Oasis will then use its own privacy-preserving capabilities to ensure that individual identity data remains confidential and is processed separately from apps and is never revealed to any third party, only that the identity has processed KYC and AML compliance.
The solution provides enterprise and business customers with an identity verification mechanism that verifies documents, matches a selfie to identification and onboards users in compliance with AML and KYC. Any user who has ever signed up for an online bank account or other financial institution online has probably gone through this process of verifying their photo ID, address and other personally identifying information.
“We are working to not only build a better, more efficient decentralized identity and on-chain KYC solution but to help accelerate the adoption of Web3 and bring more trust to the industry,” said Professor Dawn Song, founder of Oasis Labs. “Equifax is an innovative leader in the financial services space and brings highly credible and reliable data that will help drive more trust in using blockchain technology for real use cases.”
All of a user’s personally identifying information is processed by Oasis Labs’ secure data infrastructure which associates it with a digital wallet. With this solution, users maintain their privacy with pseudonymous wallet usernames and addresses allowing Web3 companies remain compliant with AML and KYC regulations while preserving user trust.
“As the Web3 economy continues to evolve, so does the need to further expand and evolve identity management and KYC solutions to help reduce risk and instill confidence in on-chain transactions,” said Joy Wilder Lybeer, U.S. information solutions chief Revenue officer at Equifax.