Know-Your-Customer (KYC) and Anti-Money Laundering (AML) obligations within the industry of cryptocurrency and blockchain are something that trades can no longer ignore, especially if the platform in question has a gateway that facilitates fiat currency. With the lack of process streaming infrastructure, verification of a user's identity can be a slow and inefficient process.
Recognizing the need to accelerate this process, Australia Post, the country's national shipping company, recently launched a new product that will allow cryptocurrency trade to complete KYC validation within a few minutes.
Known as "Digital iD", the service will ease the need for customers to wait days and days before they can access their newly created account. Under current AML regulations in Australia, cryptocurrency exchanges are needed to identify customers using their platform. This usually consists of an identity document issued by the government (such as a passport or driving license) and in some cases a proof of address (such as a bank statement).
Quick access to cryptocurrency markets
The concept involves Australian citizens undergoing a one-off registration process with Digital iD, which, once confirmed, allows users to confirm their identity with a click of the button. Although this will initially see the user upload a range of documentation with Digital iD, once the process is completed, he will be able to verify their identity with any merchant who accepts the technology.
This not only benefits the cryptocurrency exchange platforms themselves, to the extent that it is no longer necessary to install extremely expensive KYC departments, but also reduces the underlying security risks for the user. The reason is that it is not necessary to continuously distribute sensitive documents online. If it fell into the wrong hands, this would potentially allow a bad actor to fraud on identity.
An additional option that Digital iD users have is that they can decide how much personal information they want to share with a particular merchant. For example, if a supplier only requires confirmation that the customer is over 18, the Digital iD user may choose to simply share his / her name and date of birth, rather than needlessly share the driving license and proof of address.
This could also be useful if a cryptocurrency exchange requires more customer diligence on a user, which typically occurs when larger volume transactions or a particular withdrawal request exceeds a certain amount.
Partnership in progress
The Digital iD team has already formed a notable partnership with the Australian cryptocurrency exchange Digital Surge. The platform not only allows users to buy, sell and exchange a series of cryptocurrencies, but also gives users the opportunity to pay Australian bills through Bitcoin. In addition to its partnership with Digital Surge, Digital iD is also close to concluding an agreement with two further exchanges of cryptocurrencies on an Australian basis, in particular Coin Loft and Coinjar.
With the barriers of KYC and AML bonds considerably loosened, the concept of Digital iD could bring a new wave of stakeholders in the cryptocurrency sector. For example, some sectors of society simply do not feel comfortable loading personal documentation on a platform with a very limited trading history, especially in a sector that is often the victim of external hacks. However, with the support of the Australian Post, an organization with a well-established reputation that dates back more than 200 years, the reluctance mentioned above may no longer be a problem.
The Digital iD application is available for free download via Google Play or Apple iTunes Store.