Bridge Protocol ICO Looks to Solve KYC Challenges
Identity verification is a growing challenge in the digital world that’s drawing scrutiny from governments. While companies take greater measures to verify the identities of clients, consumers are growing more cautious about giving up sensitive information to each entity they engage with. Especially when hackers routinely obtain such data, even from large companies.
Bridge Protocol, an open and distributed network of trusted machines and users, aims to streamline digital ID verification on a private blockchain. The North Carolina-based venture will classify these identities on a tiered system that empowers users to share only the data they want. Developers say it will create a new standard to share personal information with a high level of privacy and anonymity.
Bridge is headed by Steve Hyduchak, CEO of ProjectICO, a full-service ICO firm based in Raleigh, N.C. The project also has involvement from Fritz Lehman, Chief Customer Officer of SAS. The whitelist signup for Bridge Protocol goes live on February 5.
With cybercrime on the rise, identity fraud is a growing concern for companies and consumers. Last year, identity theft victimized 15 million consumers and cost financial institutions $6 billion in losses.
Companies in the financial services industry are also bound by KYC (know-your-customer) processes requiring them to carefully validate the identities of those who they do business with. The problem is these processes can be cumbersome and expensive. And the Catch-22 is the more information a company collects and stores, the more information they put at risk in the event of a breach. In addition to the risks, companies that put data at risk could also face class action lawsuits and fines from regulations like General Data Production Regulation (GDPR) in Europe.
Bridge Protocol will issue digital identities and permit individuals and businesses to engage on real-world trust networks. While the solution is mainly geared towards ICOs, it could offer additional applications for transactions and general legal services.
As illustrated in its whitepaper, Bridge is designed on the China-based NEO open-source blockchain and uses a tiered system that allows the user to share only the minimum amount of information required for the verification. Tier 1 includes data such as name, address, date of birth, payment behavior and email. Tier 2 includes more sensitive things such as social security number and government-issued identification. And Tier 3 is reserved as a special status for people like accredited investors in ICOs.
New cryptographic technologies now enable stakeholders to verify identities by comparing data for matching characteristics, without having to store that data. By verifying data at one source and using behavioral characteristics with a tiered system, users can attain the verification they need with a minimal amount of information.
Knowing all your customers may be a challenge, but it doesn’t have to break an organization’s wallet.
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