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Bitmain, the largest encryption company in the world, has opened the code for the knowledge-your-customer protocol (KYC), which focuses on privacy, called Coconut.
Coconut uses Intel's Enhanced Privacy ID for authentication and separates the management of information and identification information needed to conduct business. Coconut is a response to industry concerns that KYC requests could potentially compromise the identification of the user, allowing unlimited monitoring of customers and their business. In the words of the explanatory document of the code:
"As one of the key features of the blockchain is that all transaction records are public, transparent and permanent, there are concerns that organizations can potentially track and analyze customer behavior on the blockchain once they have implemented KYC. This will raise serious problems. of privacy and will hinder the spread of the blockchain ".
The separation between identity authentication and the company means that companies can potentially integrate software and offer exchanges and other blockchain "authentication as a service" packages. Exchanges are not always completely above and users in the modern market are required to deliver on all their personal information just to do business. As Bitmain says, this raises concerns, and therefore Coconut is a potential answer – the possibility of independent and reliable verification services for customers and companies that need to authenticate their users for legal purposes.
The passage to the open source code indicates that Bitmain may not necessarily offer such services as part of its core business model in the future. It allows other companies that have an interest in verifying identity, exchangers or suppliers of portfolios or companies that want to offer the service independently, to have a starting point if not simply to use the software as it is. The code is released under the permissive license of Apache 2.0 and seems to be done in Java.
Bitmain says on his blog:
"Although there are numerous identity authentication schemes in the industry, most of these schemes focus on the use of the blockchain to store and verify user identity information, or attempt to execute the Authentication in an absolutely decentralized way, which, considering today's reality, seems to be part of a cryptophan future.The inability of existing schemes to tackle problems today has prevented them from being widely adopted.Coconut aims to use technical means to solve problems in the service level instead of the network level. "
There seems to be a trend of companies opening up the open source encryption code, previously proprietary or closed, with Square that has recently opened its Bitcoin cold storage system.
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