The U.S. Department of the Treasury is studying the integration of identity verification into DeFi smart contracts, marking a major turning point in DeFi.
This is controversial as it could change the principle of free access in DeFi while making it easier to comply with KYC and anti-money laundering.
MAIN CONTENT
The U.S. Department of the Treasury is considering the integration of identity verification into DeFi smart contracts.
Opponents are concerned that this limits decentralized access, affecting the foundations of DeFi.
Supporters argue that the integration of KYC and AML helps simplify compliance and prevent crime.
What plans does the U.S. Department of the Treasury have regarding DeFi and identity verification?
The U.S. Department of the Treasury is examining the possibility of adding direct identity verification functionality to DeFi smart contracts to enhance transparency and security.
This is a step towards controlling the flow of money and preventing crime in the rapidly developing DeFi sector. If implemented, it would be a significant change in the operation of traditional DeFi, which emphasizes openness and the absence of intermediaries.
Why does the integration of identity verification into DeFi provoke mixed reactions?
Director of Ubuntu Tribe, Mamadou Kwidjim Toure, warns this is like 'installing cameras in every living room,' which could destroy the neutral nature and free access of DeFi.
Opponents worry that this will pull DeFi back to a limited financial model that requires government approval to participate, harming decentralization and privacy.
“This is like installing a camera in every living room, destroying the core of DeFi by turning a neutral platform into one that requires government-approved identity verification.”
– Mamadou Kwidjim Toure, CEO of Ubuntu Tribe, 2023
What benefits come from adding KYC and AML to the DeFi system?
Proponents argue that integrating customer identity verification (KYC) and anti-money laundering (AML) into blockchain will help simplify the legal compliance process for DeFi projects.
This helps retain serious investors and prevents fraud and financial crime, contributing to a safer and more sustainable DeFi in the future.
What are the long-term impacts of direct identity verification in DeFi?
If widely adopted, adding identity verification functionality to DeFi smart contracts could diminish decentralization and make the sector more similar to traditional financial systems.
In the long term, this requires developers and users to weigh the preservation of DeFi's openness against the need for legal compliance to ensure sustainable development.
Frequently Asked Questions
Does the integration of identity verification into DeFi undermine decentralization?
Some degree of decentralization loss may occur as the requirement for government identity verification limits free access, impacting the foundational principles of DeFi.
What do supporters argue is the main benefit of this?
Helps simplify compliance with KYC, AML, ensures financial safety, limits illegal activities in the DeFi sector.
Who strongly opposes this plan?
CEO Mamadou Kwidjim Toure of Ubuntu Tribe warns about the negative impact on freedom and neutrality in DeFi.
How does this affect current DeFi users?
Users may have to provide identification to use services, reducing anonymity and free access.
When is this change expected to be implemented?
There is no specific timeline yet as the Department of the Treasury is in the research and impact assessment phase.
Source: https://tintucbitcoin.com/tai-chinh-my-tich-hop-xac-minh-defi/
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