Civic (CVC) up 40% as cryptocurrency regulations move forward
As privacy, data security and ID efficiency issues become prominent, blockchain solutions like CVC may benefit.
The challenges of effective identity verification and cryptocurrency's compliance with know your customer (KYC) laws have been a constant point of friction ever since people started trading fiat cash for crypto cash on compliant and registered exchanges.
One of the main complaints of any exchange is the long verification times. It's been known to take weeks or even months, which is an especially long time in cryptocurrency.
Meanwhile, the much touted Kodak ICO was delayed by verification problems, exchanges are navigating new KYC requirements with varying degrees of competence, businesses could always use more effective KYC compliance solutions and Korea recently ended anonymous trading.
Against the backdrop of a quickly tightening regulatory lens, it might not be too surprising that the Civic (CVC) coin has almost doubled in price over the last two days. This cryptocurrency is specifically designed to facilitate identity management by putting it in the hands of the individual.
In simple terms, it uses blockchain technology to securely store user information such as name, address, bank account confirmation, driver's licence details and anything else which might be needed for signing up to services.
Where this information has been confirmed, it's digitally marked as such. If a Civic user wants to sign up and get verified on a cryptocurrency exchange, they can simply provide their Civic account details to the service, which can then request specific information.
Uniquely, it also lets users provide verification without actually providing the details, in what's likely to be a KYC compliant fashion.
For example, an Australian crypto exchange might ask for a picture of your utility bill and driver's licence, but all they really need to confirm is that you're over 18 and a legal resident of Australia. Looking at your utility bill and driver's licence is one of the few ways to actually do this in a way that's compliant with current KYC laws, but it also puts a lot of potentially sensitive information in the hands of the exchange.
With a solution like Civic, someone could confirm that they're a legal resident of Australia over the age of 18 without giving away their actual age, address or anything else. This is a much safer way of verifying details.
Information is valuable. It can be bought and sold for a little or a lot, depending on how good it is.
- Low quality information might be a list of user initials and their credit card numbers from two years ago. This might be sold in bulk for fractions of a cent each.
- High quality information might be a recently updated list of full names and credit card numbers acquired a month ago. This would be considerably more expensive.
When you provide highly detailed information, such as you might need to give a bank or a KYC-compliant cryptocurrency exchange, you're actually entrusting them with valuable information. Sometimes they'll choose to sell it. If you ever read the privacy terms and conditions of a service, you might be surprised to find out that they're very upfront about it.
But in many cases, they'd rather avoid having that information in the first place to avoid the cost of heavy investment in data security and the potential consequences of a breach.
Blockchain technology has the potential to bring an effective identity management solution that users and businesses alike have reasons to use.
A detailed review of how the Civic system works
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Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VEN and XLM
