Decentralized exchange DeversiFI launches anonymous KYC solution

DeversiFI and identity management platform Iden3 jointly announced the launch of the identity verification application TrustCommunity, which can help decentralized exchanges comply with regulatory requirements, adhere to KYC procedures without compromising user privacy.

TrustCommunity application uses Zero-Knowledge Proof (ZKP) to verify identity without sharing irrelevant information such as age and name, and can be used across multiple applications and protocols like an ID card.

According to a report, TrustCommunity is still in the experimental stage. If successful, the technology could expand into ZKP solutions to help verify identity. Will Harborne, co-founder of DeversiFI, mentioned in an interview:

We are considering collaborating with verification platform Onfido, which will confirm user identities. Once verified, users will receive a digital certificate based on the TrustCommunity protocol. The certificate does not contain any personal information but can be used by other platforms as a form of identity verification.

This means users only need to share their identity with TrustCommunity without having to share it with all other service providers.

For decentralized exchanges, this could be a significant breakthrough, as decentralized exchanges have gradually introduced KYC mechanisms under regulatory intervention.

Despite receiving criticism from many users and media, decentralized exchange IDEX implemented a KYC policy earlier this year. Harborne believes:

This suddenly makes decentralized exchanges more viable. Exchanges can use TrustCommunity to comply with regulators without storing user information, thus saving the cost of custodial services.

DeversiFI has been working with Iden3 for almost a year. Although still in the experimental stage, Harborne has presented the idea of this anonymous KYC solution to some regulatory agencies. Harborne explained:

Originally designed for Ethereum, TrustCommunity can now serve a broader crypto community. We did not deliberately seek a competitive advantage, which is rare.

This solution will undergo public testing at the DevCon5 conference in Osaka later this month.

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