KeyFi has created a system that will help bridge the gap between Centralized Finance (CeFi) and Decentralized Finance (DeFi). Among many other features, it offers a self-sovereign identity solution and also a non-custodial, open-source wallet.
There are many reasons to combine the DeFi and CeFi ecosystems, and KeyFi is one of the most developed solutions in the market today.
One of the biggest hurdles for using CeFi platforms is AML/KYC regulations. While there are still many options in the crypto space that have little or no AML/KYC regulations, anytime a person wants to enter the fiat currency world, there will be some level of oversight.
In practical terms, these AML/KYC barriers make things complex for anyone that wants to utilize both crypto and fiat assets. While some exchanges, such as Binance, have created robust tools for fiat currency and crypto, as a market, these two systems are still very much divided.
KeyFi is Flattening the Regulatory Landscape
KeyFi is approaching the CeFi and DeFi conundrum from a few angles. One of the most innovative is the first credentials based DeFi token, and its SelfKey Credentials platform. The world of AML/KYC relies on the extensive use of personal data to verify the identity of a person within the banking system.
In practice, this means sharing loads of personal data, which isn’t always kept safe by the bank or financial institution. While banks are required to abide by relevant AML/KYC procedures, they don’t face consequences when consumer data is lost to hackers, which puts retail banking customers in a tough spot.
As 2020 has demonstrated, major economies will be looking to put tighter regulations on crypto assets, which means that platforms like KeyFi will likely be vital for the development of the industry going forward.
Ultimately more regulations are likely good for the industry, as more capital will enter the market…