Binance Joins KYC Cross-Industry Blockchain Data Sharing Network
Top cryptocurrency exchange Binance has partnered with the Shyft Network public blockchain protocol as it is prepared to comply with the regulations of the Financial Action Task Force (FATF).
The Shyft Network was developed to provide a decentralized solution for crypto industry players to meet global compliance standards including the "travel regulation" of the FATF. According to Samuel Lin, Chief Compliance Officer of Binance, there was no existing infrastructure for businesses to comply with the new FATF regulations until the creation of the Shyft Network.
The controversial travel rule requires VASPs to collect and exchange Know Your Customer (KYC) information during transactions as part of the FATF's revised guidelines for Virtual Asset Service Providers (VASPs) — released last summer 2019 and set to come into force this June, 2020.
Shyft seeks to encourage crypto firms to implement an industry-wide solution to the requirements of the FATF by using their identity passporting, database bridging and data certification infrastructure.
Its open-source technology — designed to comply with both the FATF guidelines and the GDPR data privacy regulation of the European Union — seeks to ensure the full use of decentralized networks and to create stable principles of data sharing that applicable across multiple jurisdictions.
In light of an incident last summer, Binance's early collaboration with Shyft is perhaps especially significant. In August 2019, the company fell victim to a hacking ransom heist that reportedly saw the miscreant take control of a huge chunk of KYC data from the business (more than 10,000 personal photos).
While questions were posed about the authenticity of the allegedly leaked data, according to Binance, the time that the photos released so far could be dated back to a time when the exchange used a third-party service provider to process its KYC verifications.
